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Well, I don't like the idea to have investors of my company right now.

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They try to grow too quickly.

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They start growing, growing, growing without making sure they have a good reputation and

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making money on the whole time.

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We don't open more properties if we are not making money in the old one.

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Hello friends and travelers.

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Thanks for listening.

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You are riding along on the Hostel Road Trip podcast.

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Our mission is to spread awareness of the true hostile experience in the Americas and

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share stories from the fascinating hosts who create those unique facilities.

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I'm your host Jimmy Black, joined alongside co-founder of International Travelers House,

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Bobby Dyer.

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Each session, we sit down with hostile operators or travel influencers to hear about their

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road success, discuss trending hostile topics, and close with tips for travelers who are

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seeking to have the ultimate experience when visiting each destination.

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You can't afford to miss this trip.

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Now fasten your seatbelts and let's hit the road.

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All right.

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Welcome back to the Hostel Road Trip podcast.

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We are here, myself, Jimmy Black and Bobby Dyer of ITH Hostels.

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We are here with Mateus of Che Hostels in Mexico.

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Thank you so much for joining us for this exciting episode.

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And we're going to be diving into not only Mateus' personal journey into hostels, but

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also what it's like to run multiple hostels as Che has grown into quite a force down there

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in Mexico and then touch into a bit about the hostile industry in Mexico and a lot of

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the really cool things going on down there.

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I always feel like Mexico is really in that, as far as hostels go, authentic, genuine backpack

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or hostile vibe.

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And style of traveler is really cool to experience down there, whereas a lot of other countries

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are going in a different direction with hostels, they're becoming more like hotels or becoming

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very much catered to like the American clientele here who's into more privacy.

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So I think Mexico is just right for the experience of hosteling.

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But Mateus, tell us how you got into hosteling.

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What was your first exposure, you know, as a guest or as a staff worker?

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And well, thanks for having me here, guys.

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My first experience with hostels was probably when we were on traveling and I really loved

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budget.

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So we sleep on a tent with my friends on the background of the street or whatever we can

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sleep on free.

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Going to a bar and there were people saying, yeah, we pay really cheap in that place called

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a hostel.

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We were paying zero, sleeping on the street.

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And there were people saying, no, no, this is a cool place, hostel for one dollar, two

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dollars in Argentina.

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So of course we have no money at that time.

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So we just keep sleeping for free on the tent until I start working and get some cash.

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Okay, I will go to this, they call hostel and see if they look cool people all in the

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bar and not like fancy ones.

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So that was the first time I heard about hostel, like probably drinking in a bar with random

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guests.

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I was like 18, 17, something like that.

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And I guess my first time in a hostel was when I was 19.

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I was traveling by myself alone for five days and say, okay, time to go to a hostel and

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see to meet some people.

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And since that point, I started as every time I travel Europe, Argentina, Peru, the US was

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always in hostels.

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It was always the bar, the party, the meeting people, going out drinking.

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Like when you are 18, 19, 20, you can go to the museum, but the important thing is that

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you meet people and hang out.

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So that's how I get into the life of a hostel in the streets.

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And then I used to be an engineer, but I guess I still am.

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I used to work in IBM and Microsoft.

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And I just quit everything and moved to Mexico.

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Oh wow.

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And I decided it was time to move to Mexico and be a photographer or something like that

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that never really worked out.

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I was supposed to be a snorkeling photographer.

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I just broke my first camera when I went down to water.

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So I stayed in a hostel and I was living for like six months in a hostel in Playa del Carmen

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like 12 years ago.

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And by that time I was in the best hostel in Playa del Carmen and it was probably a

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horrible hostel.

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I mean, it was amazing, but you know, this kind of old bunk beds with pillows and bed

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bags and they have like this free breakfast every day with coffee, bread and a big jar

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of, I cannot believe it's not butter.

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That was my bread for six months.

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And I remember like, you know, in Europe the hostels were more fancy, more nice.

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But this hostel was amazing.

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It had a pool, party, bites, everything.

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It was really all like, so I started thinking, okay, I think I can do this better.

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Like if I have an opportunity and in one moment during my stay in Playa del Carmen, there

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was a building that was supposed to become a hostel and then the owner stopped the idea

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and he decided to create an apartment and we were living there.

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And I say, hey, instead of change everything, this is kind of a hostel.

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Let me just pay the rent, the whole building and I can like take the property.

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And that's how we started.

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It was an old hostel that the owner quit and the owner of the property is going to change

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into an apartment and I told him like, keep it like that.

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I will pay the rent.

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You don't put any dollar.

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I will keep the old bunk bed, the old mattress and I will start to create a hostel here.

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And that's how it started.

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That was 13 years ago in Playa del Carmen.

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And it was a good time for Playa del Carmen.

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So that was the first location with Playa del Carmen.

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Yes, at that time everyone was going to Playa del Carmen.

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That was really helpful.

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It was fucking full every time.

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New Year was madness.

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It was before the new destination in Mexico really popped up.

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At that time everyone was supposed to go to Playa del Carmen.

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And that really helped.

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And if she played, it would work.

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New Year, everything was online.

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So that helped us to start getting guests quickly.

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I remember we were like $3 a day or something like that.

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We were the cheapest one when we started.

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No reviews, no experience.

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That's how it got cheap.

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Wow.

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So that was the first location.

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How long before you opened your second location after that?

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We opened a small restaurant that didn't really work out.

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So we had another business for three or four years.

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And then four years after the first one, we decided to open the second hostel.

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And it was lucky that I went to a conference in Madrid,

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like the one I met you in Oregon last year.

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At that conference there were a lot of people from industry.

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I was thinking to open a second property in Playa del Carmen.

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The hour was for like 50 beds, but it was always full.

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I was thinking, okay, it's time to have maybe a second location in Playa.

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Maybe cheaper, different.

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But then when I went to the conference,

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I was asking two people that have multiple properties in Europe.

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And one of them, they were in Russia, they told me,

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it's better to open a second location because you will learn much more

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with two different locations.

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And if something happens with the first location, you will have the second one.

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So I took that advice from the conference.

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And so I changed my mind to go to second location Playa del Carmen

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and we went to Tulum.

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It was starting to have some name at the point,

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because at the beginning I would say there is nothing in Tulum.

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But that was like eight years ago.

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Tulum was just like people started going there.

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That's why we decided, okay, it's time to go to a second location

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four years after the first one.

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I went because I went to a conference and I took the advice of people

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who already have multiple properties.

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But I would probably have the mistake to have the second Playa del Carmen,

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make some money for a few years, and then when Playa del Carmen went down,

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I would probably really, really really down.

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Because Tulum say Playa del Carmen when the player got really bad year after that.

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Yeah, no, that's very good advice in that, you know,

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of course it is challenging to have more than one location,

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you know, especially in different cities.

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But it really does give yourself that diversity that if a particular city

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that you're operating out of starts to have a downtrend or a downtick

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that really isn't in your control,

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you can really have that strength within the variety of your locations

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and also in different seasons and things like that.

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So how many Che hostels are there in total?

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Right now we open the ninth one next Monday in San Cristobal.

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Congratulations.

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Where is that one opening?

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It's in San Cristobal in Chapas.

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It's like the middle of the connection between the Caribbean side

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with the Pacific side in the mountains.

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Oh.

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It's the first one with no pool and in the winter, it's cold.

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Oh, that's exciting.

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Yes, congratulations.

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All right.

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That's number nine.

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That's number nine.

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Go get them.

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Wow.

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Now, with that, you know, that's a huge jump right there.

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You know, we were talking about opening a second location in the challenges,

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but also the benefits of the variety.

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Now that you're all the way up there moving into that ninth location,

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how has your structure evolved?

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You know, would you say that you have a lot of like departmentalization

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or management levels or how often do you get your, you know,

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hands in the sauce of like actually working at the hostels?

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How has that evolved for you?

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Right now I'm not on the direct operation anymore.

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I still go to the old hostels to talk to the people.

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I don't talk to the guests.

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I talk to the guests, but when I'm with the guests,

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I just go to the pool and talk to the guests, but they don't know who I am.

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But I talk to the employees.

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Right now we learned that we have like regions,

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like every two hostels we have a region,

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then we have four hostels in the Caribbean side.

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But we have people like one region in the Caribbean,

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one in the Pacific, so they can travel between them.

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But right now, Plaza and Holbox Island,

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they are just one manager for those two.

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And then you have Touloune and Bacalar, which is like two hours different.

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You have another guy from those two and then one above for the four of them

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on the operation level.

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And then operation, I mean like receptionist, food and beverage,

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like bartender, cleaning, maintenance.

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And then we have like a kind of a corporate or back office

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that you have, you know, the bookies, marketing, supplies, IT.

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And we have a main office in Bayard Carmen,

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but there's not too many people right there.

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And then we have maybe one people of marketing content in the Pacific side

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and one kind of bookies that work from the Pacific side.

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I mean, they have one leader, but right now we have people spread around the country.

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In the past we had like all the corporate in the office,

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but they were like, they lacked the connection between the office and the operation.

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And with the fighting between the office, you are always sitting with the AC.

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We are here on the front desk.

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So we decided to stop moving the people.

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So, okay, we're going to take care of those two properties.

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You're going to live in the city and you're going to be working from the hostel,

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in the co-working, like on your home,

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or most of the time on the hostel, talking with the operation.

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Because sometimes someone buys something for mistake and the bartender says,

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no, I didn't buy that, I ordered other things,

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but the guy delivered me this alcohol, we don't sell it.

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If everyone is on the same place, they are together.

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So, okay, they have to sort it together.

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It's not that email saying, it's not my fault, it was the office.

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And the office say, no, it was the operation.

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So we tried to put the people from the office in the operation right now.

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Because if not, there were no integration.

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There was some fighting for my department, your department,

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and at the end we are one company, one guest.

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Yeah, yeah.

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And that's some great advice and insights into that of how to scale up in this business

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and have the multiple locations.

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And I think it's probably relevant to all business operations,

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but so often you have the people that are on the scene, the foot soldiers,

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and then you have the people behind the curtain,

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and they're both telling a different story and blaming each other,

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and then that falls on you and flows out.

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Exactly.

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Something blows up, but they're both on the operation,

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but you are in the operation, you can help to solve the problem.

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It's not like you are a thousand miles away and you just got a...

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I don't know, you are both there, you have to...

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Even if they're fighting between the operation and the back office,

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they are together.

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Because it's a big...

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They always blame one operation from the back office,

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they're fighting sometimes.

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Oh, yeah.

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So we take them as a team.

242
00:13:50,760 --> 00:13:54,760
You're spending all of your time running around trying to catch up

243
00:13:54,760 --> 00:13:56,760
with the latest ones report.

244
00:13:56,760 --> 00:13:58,760
But that's something that definitely...

245
00:13:58,760 --> 00:14:00,760
We've experienced the similar of...

246
00:14:00,760 --> 00:14:04,760
It's so important to integrate those two and to have them working together

247
00:14:04,760 --> 00:14:08,760
and to keep people on site and in touch with the experience

248
00:14:08,760 --> 00:14:12,760
and the operation across the board from front to back.

249
00:14:12,760 --> 00:14:14,760
That's such a great help.

250
00:14:14,760 --> 00:14:17,760
I think it's key that a lot of people from the back office,

251
00:14:17,760 --> 00:14:19,760
before they work on the operation,

252
00:14:19,760 --> 00:14:22,760
the people from the booking before used to work on receptionist,

253
00:14:22,760 --> 00:14:24,760
so they know how it is.

254
00:14:24,760 --> 00:14:27,760
Those that maybe didn't never work on the operation,

255
00:14:27,760 --> 00:14:31,760
maybe human resources sometimes or the marketing,

256
00:14:31,760 --> 00:14:35,760
they sometimes don't understand how it's having a...

257
00:14:35,760 --> 00:14:37,760
I guess complaining in front of you, screaming,

258
00:14:37,760 --> 00:14:40,760
all the shit happening in the hostel.

259
00:14:40,760 --> 00:14:42,760
But if you work there and then you move to the office,

260
00:14:42,760 --> 00:14:45,760
you have more empathy with the team.

261
00:14:45,760 --> 00:14:48,760
I remember when I was receptionist, that was horrible.

262
00:14:48,760 --> 00:14:51,760
You tried to help when that happened.

263
00:14:51,760 --> 00:14:53,760
Absolutely. 100%.

264
00:14:53,760 --> 00:14:56,760
We absolutely agree with that,

265
00:14:56,760 --> 00:15:02,760
with promoting from within and moving people from that side to the other side.

266
00:15:02,760 --> 00:15:04,760
Now they can have that relevant connection.

267
00:15:04,760 --> 00:15:07,760
And then also the operation people have to...

268
00:15:07,760 --> 00:15:10,760
They have respect for them too because they know,

269
00:15:10,760 --> 00:15:13,760
okay, this person had my job before, they know what I'm talking about.

270
00:15:13,760 --> 00:15:16,760
So I think there's so many advantages to that.

271
00:15:16,760 --> 00:15:19,760
Yeah, that's awesome to see.

272
00:15:19,760 --> 00:15:24,760
So now, you had said it was your first one without a pool.

273
00:15:24,760 --> 00:15:31,760
So all the other locations have a pool and a bar and a restaurant or just a bar.

274
00:15:31,760 --> 00:15:34,760
Does each one of them have one of those type of side operations?

275
00:15:34,760 --> 00:15:38,760
Yeah, all of the rest have a swimming pool,

276
00:15:38,760 --> 00:15:40,760
one of them bigger than the other.

277
00:15:40,760 --> 00:15:45,760
And we have a bar and restaurant in most of them.

278
00:15:45,760 --> 00:15:49,760
But for example, in Bayard Carmen, it's a really small one,

279
00:15:49,760 --> 00:15:51,760
and it's full of restaurants around.

280
00:15:51,760 --> 00:15:54,760
We only make dinner parties like pizza night or burger.

281
00:15:54,760 --> 00:15:58,760
We don't have a proper restaurant because it's too small a place

282
00:15:58,760 --> 00:16:03,760
and during daytime it's too hot and it's full of restaurants around.

283
00:16:03,760 --> 00:16:05,760
But it's the only one probably.

284
00:16:05,760 --> 00:16:12,760
In all of the rest, we have a full restaurant with breakfast, lunch and dinner.

285
00:16:12,760 --> 00:16:16,760
In the past, I remember when I used to say I will never charge for a breakfast

286
00:16:16,760 --> 00:16:19,760
because breakfast in the hostel is supposed to be free.

287
00:16:19,760 --> 00:16:22,760
But then when people start changing, the guests change.

288
00:16:22,760 --> 00:16:25,760
And I remember having a better breakfast

289
00:16:25,760 --> 00:16:28,760
and there were 100 people going for a free breakfast in Sebring City.

290
00:16:28,760 --> 00:16:33,760
I remember one complaint saying they only have one type of cheese.

291
00:16:33,760 --> 00:16:39,760
I was like, you know what, we're going to charge it,

292
00:16:39,760 --> 00:16:42,760
we're going to make it great, but it's not going to be free anymore

293
00:16:42,760 --> 00:16:44,760
because it doesn't matter what you do, if it's free,

294
00:16:44,760 --> 00:16:46,760
they're always going to find a way to complain.

295
00:16:46,760 --> 00:16:50,760
And it was a mess of 100 guys arriving 10 minutes before close, eating everything.

296
00:16:50,760 --> 00:16:54,760
And they get used to like, I remember, big change,

297
00:16:54,760 --> 00:16:57,760
like a lean-in-the-bar generator, and they start selling.

298
00:16:57,760 --> 00:17:00,760
And people got used to pay for breakfast.

299
00:17:00,760 --> 00:17:05,760
So we changed and we have our full restaurant right now.

300
00:17:05,760 --> 00:17:10,760
And we have less complaints about the free breakfast.

301
00:17:10,760 --> 00:17:13,760
Yeah, no, and that's the evolution of things.

302
00:17:13,760 --> 00:17:15,760
I know what you mean by that.

303
00:17:15,760 --> 00:17:18,760
Sometimes you start with such a perspective in one way and over time,

304
00:17:18,760 --> 00:17:21,760
you learn to change with it and adapt.

305
00:17:21,760 --> 00:17:29,760
How much of a revenue from the food and beverage compared to the hostel beds,

306
00:17:29,760 --> 00:17:33,760
what would you say is a general percentage?

307
00:17:33,760 --> 00:17:36,760
Is it like half and half?

308
00:17:36,760 --> 00:17:40,760
No, for us it's 30% food and beverage.

309
00:17:40,760 --> 00:17:45,760
In the food company, of course, some nations are higher or lower,

310
00:17:45,760 --> 00:17:47,760
but in the food company it's 30%,

311
00:17:47,760 --> 00:17:53,760
like probably 20-something beverage and 8-10% is food.

312
00:17:53,760 --> 00:17:59,760
And then 70% is between accommodation and experience.

313
00:17:59,760 --> 00:18:02,760
Experience, right now we are not selling much.

314
00:18:02,760 --> 00:18:06,760
We need to make a big change there because we have a lot of location,

315
00:18:06,760 --> 00:18:10,760
but we never really invest on having a tour operation.

316
00:18:10,760 --> 00:18:15,760
But we should, because it's another revenue income that we should have

317
00:18:15,760 --> 00:18:20,760
in so many locations, we are not using the logistics and all the people

318
00:18:20,760 --> 00:18:23,760
that we have to start having our own tour.

319
00:18:23,760 --> 00:18:28,760
We have, but we are not making such a money, such a revenue that we can't.

320
00:18:28,760 --> 00:18:30,760
Yeah.

321
00:18:30,760 --> 00:18:34,760
It's interesting as we have a hostel in Mexico,

322
00:18:34,760 --> 00:18:38,760
there are so many US and Canadian travelers that come down, right?

323
00:18:38,760 --> 00:18:42,760
So you are really hosting completely different customers compared to the Mexican travelers, right?

324
00:18:42,760 --> 00:18:45,760
So you got to cater to both sides, I guess.

325
00:18:45,760 --> 00:18:50,760
How have you strategized to do both those?

326
00:18:50,760 --> 00:18:55,760
And what is the, maybe it hides into the bar element,

327
00:18:55,760 --> 00:19:00,760
but what is the best strategy to have a hostel in Mexico

328
00:19:00,760 --> 00:19:04,760
that can cater to Mexicans and also to foreigners?

329
00:19:04,760 --> 00:19:06,760
What have you found to work best?

330
00:19:06,760 --> 00:19:09,760
It's a difficult question because first of all,

331
00:19:09,760 --> 00:19:12,760
Mexicans are not so used to traveling in hostels,

332
00:19:12,760 --> 00:19:14,760
even though now it's growing and growing.

333
00:19:14,760 --> 00:19:19,760
Like 15 years ago, it wasn't so like the most common.

334
00:19:19,760 --> 00:19:24,760
And then we have 90% of our guests, they are not Mexican.

335
00:19:24,760 --> 00:19:27,760
We have only 10% of Mexicans.

336
00:19:27,760 --> 00:19:31,760
But now we think that that market is still growing.

337
00:19:31,760 --> 00:19:35,760
And I don't know when I received a bad review saying,

338
00:19:35,760 --> 00:19:40,760
I feel like racist or something because I'm Mexican.

339
00:19:40,760 --> 00:19:43,760
I feel like everyone was speaking English,

340
00:19:43,760 --> 00:19:46,760
all the sign was in English and not in Spanish.

341
00:19:46,760 --> 00:19:52,760
So it's difficult because 90% of our customers are from the rest of the world.

342
00:19:52,760 --> 00:19:57,760
Yeah, that's a challenge.

343
00:19:57,760 --> 00:20:00,760
We don't have a specific strategy to say,

344
00:20:00,760 --> 00:20:03,760
okay, we want to make this culture feel happy.

345
00:20:03,760 --> 00:20:06,760
We try to make everyone feel happy.

346
00:20:06,760 --> 00:20:14,760
So sometimes we do tacos, but the tacos are not so,

347
00:20:14,760 --> 00:20:17,760
they are kind of more tourist tacos.

348
00:20:17,760 --> 00:20:21,760
So if a Mexican probably eats it, we say, that's not what we eat at home.

349
00:20:21,760 --> 00:20:23,760
We had that happen to us.

350
00:20:23,760 --> 00:20:27,760
Yeah, the Mexicans, we try to serve tacos and they laughed at us.

351
00:20:27,760 --> 00:20:33,760
Yeah, that happened.

352
00:20:33,760 --> 00:20:37,760
It is happening.

353
00:20:37,760 --> 00:20:40,760
We should try to make everyone happy.

354
00:20:40,760 --> 00:20:43,760
No, again.

355
00:20:43,760 --> 00:20:45,760
Now, what about for sharing hostels?

356
00:20:45,760 --> 00:20:48,760
You're at nine now, opening up your ninth one.

357
00:20:48,760 --> 00:20:52,760
Do you have a goal in mind of how many you'd like to have?

358
00:20:52,760 --> 00:20:56,760
Or is that not something that's really how you work it?

359
00:20:56,760 --> 00:21:01,760
How many locations do you think you're going to go for?

360
00:21:01,760 --> 00:21:06,760
We're planning to have the complete south of Mexico.

361
00:21:06,760 --> 00:21:08,760
We're planning to have like 12.

362
00:21:08,760 --> 00:21:13,760
We need going to Oaxaca, Mexico City, and probably Isla Mujeres.

363
00:21:13,760 --> 00:21:15,760
That would be a nice spot.

364
00:21:15,760 --> 00:21:20,760
Mexico City and Oaxaca are probably the other two locations that we would like to have.

365
00:21:20,760 --> 00:21:25,760
Because a lot of tourists, they enter the country in Cancun

366
00:21:25,760 --> 00:21:29,760
and make all the south Cancun, Calmentulun, Paca Laf,

367
00:21:29,760 --> 00:21:33,760
and they cross to the Pacific side, Puerto Escondido, Oaxaca,

368
00:21:33,760 --> 00:21:35,760
and end the trip in Mexico City.

369
00:21:35,760 --> 00:21:38,760
So Mexico City and Cancun are the main airports.

370
00:21:38,760 --> 00:21:41,760
Most of the tourists that we have, they enter from one of those airports

371
00:21:41,760 --> 00:21:43,760
and make all the rounds.

372
00:21:43,760 --> 00:21:48,760
From Mexico City to the north, our customers are probably different.

373
00:21:48,760 --> 00:21:51,760
Maybe Sayulita, Guadalajara, Los Cabos.

374
00:21:51,760 --> 00:21:56,760
It's kind of different people, different, and all kinds of streets.

375
00:21:56,760 --> 00:21:59,760
That's why we think of Oaxaca and Mexico City.

376
00:21:59,760 --> 00:22:01,760
Because if you start in Mexico City and start going down,

377
00:22:01,760 --> 00:22:04,760
you will go to Oaxaca, Puerto Escondido, San Cristobal.

378
00:22:04,760 --> 00:22:12,760
If you go to Cancun, that's like our road from Cancun to Mexico City.

379
00:22:12,760 --> 00:22:14,760
That's great.

380
00:22:14,760 --> 00:22:19,760
Thanks for the time.

381
00:22:19,760 --> 00:22:23,760
Yeah, it's tough to juggle all of them, but 12 is a good number right there.

382
00:22:23,760 --> 00:22:25,760
Yeah, that's a solid.

383
00:22:25,760 --> 00:22:29,760
Now, what do you think about for the hostel industry in Mexico?

384
00:22:29,760 --> 00:22:30,760
What do you feel about it?

385
00:22:30,760 --> 00:22:33,760
Do you feel like there's still a lot of growth that's going to happen

386
00:22:33,760 --> 00:22:36,760
with more hostels opening, or is there enough space for that to happen?

387
00:22:36,760 --> 00:22:37,760
What do you think?

388
00:22:37,760 --> 00:22:40,760
Yeah, the industry is growing.

389
00:22:40,760 --> 00:22:43,760
And it's going to keep growing for the next 10 years,

390
00:22:43,760 --> 00:22:47,760
because all these people are getting more and more used to travel in hostels.

391
00:22:47,760 --> 00:22:51,760
Also, the competition is growing, like more chains are arriving.

392
00:22:51,760 --> 00:22:54,760
For example, we had a head of arrive like two years ago,

393
00:22:54,760 --> 00:22:55,760
and now they have four or five.

394
00:22:55,760 --> 00:22:59,760
And it's getting more professional, like another company getting investment

395
00:22:59,760 --> 00:23:01,760
from big groups.

396
00:23:01,760 --> 00:23:05,760
So you can start seeing these hostels of 400 beds or 300 beds arriving to Mexico.

397
00:23:05,760 --> 00:23:09,760
So the industry, the market will grow.

398
00:23:09,760 --> 00:23:13,760
But sometimes the offering is growing quicker.

399
00:23:13,760 --> 00:23:16,760
And you can see, for example, in Puerto Escondido,

400
00:23:16,760 --> 00:23:22,760
we opened two years ago, and now we were not the first one, of course.

401
00:23:22,760 --> 00:23:25,760
But now it's getting more and more hostels opening.

402
00:23:25,760 --> 00:23:28,760
So maybe in two or three years, there's going to be too many hostels in one location.

403
00:23:28,760 --> 00:23:29,760
The same happened in Rome.

404
00:23:29,760 --> 00:23:32,760
In Rome right now, it's full of hostels and no tourists.

405
00:23:32,760 --> 00:23:33,760
And now, it's going down.

406
00:23:33,760 --> 00:23:37,760
So it's not a mature country on hostels.

407
00:23:37,760 --> 00:23:39,760
A lot of destinations are new.

408
00:23:39,760 --> 00:23:43,760
Like, Paya Gramen is new, Tulum is quite new, Puerto Escondido is in a boom.

409
00:23:43,760 --> 00:23:46,760
So that destination is not like New York or Madrid,

410
00:23:46,760 --> 00:23:48,760
where you have tourists.

411
00:23:48,760 --> 00:23:50,760
You know how it's going to be.

412
00:23:50,760 --> 00:23:53,760
So it's going up and down.

413
00:23:53,760 --> 00:23:54,760
Oh, yeah.

414
00:23:54,760 --> 00:23:59,760
It is an interesting ride in aspect to the industry in Mexico.

415
00:23:59,760 --> 00:24:03,760
You kind of catch the wave of the town as it's becoming popular,

416
00:24:03,760 --> 00:24:05,760
as it's on its rise.

417
00:24:05,760 --> 00:24:07,760
You can ride that wave.

418
00:24:07,760 --> 00:24:09,760
There's the other side, a bit of dwell.

419
00:24:09,760 --> 00:24:12,760
Yeah, we're very lucky when we're having on the ride.

420
00:24:12,760 --> 00:24:16,760
Because we've been in Playa, because I was in Playa and it was the boom.

421
00:24:16,760 --> 00:24:18,760
Then we moved to Tulum, it was a boom.

422
00:24:18,760 --> 00:24:21,760
And then the next one, it was a boom.

423
00:24:21,760 --> 00:24:25,760
And now we went to Puerto Escondido, maybe one year later.

424
00:24:25,760 --> 00:24:29,760
And now Puerto Escondido is probably 40% of the income from the company

425
00:24:29,760 --> 00:24:31,760
is coming from Puerto Escondido.

426
00:24:31,760 --> 00:24:34,760
It's fully full, while the rest is having that problem right now.

427
00:24:34,760 --> 00:24:37,760
Tulum right now, everyone is suffering because there's just too many

428
00:24:37,760 --> 00:24:38,760
offering right now.

429
00:24:38,760 --> 00:24:40,760
And the tourism is down.

430
00:24:40,760 --> 00:24:43,760
So that's why it's like that.

431
00:24:43,760 --> 00:24:49,760
Yeah, but that helps with the multiple locations, right?

432
00:24:49,760 --> 00:24:53,760
Because while you're one operation in Tulum, you might be in a lot of trouble

433
00:24:53,760 --> 00:24:54,760
right now because...

434
00:24:54,760 --> 00:24:57,760
And you have five in Tulum, you're the worst.

435
00:24:57,760 --> 00:24:59,760
You have five in Tulum, you're the worst.

436
00:24:59,760 --> 00:25:02,760
We didn't open Puerto right now, we were kind of like, OK, we were probably

437
00:25:02,760 --> 00:25:04,760
going even between all of the properties.

438
00:25:04,760 --> 00:25:06,760
A few then are going down.

439
00:25:06,760 --> 00:25:11,760
Yeah, we know that game well.

440
00:25:11,760 --> 00:25:17,760
What is your reaction to Selena going bankrupt?

441
00:25:17,760 --> 00:25:20,760
And now they just left Sayulita, they're gone.

442
00:25:20,760 --> 00:25:23,760
So how do you avoid becoming Selena?

443
00:25:23,760 --> 00:25:26,760
Obviously it was a beautiful brand, great branding, beautiful property,

444
00:25:26,760 --> 00:25:28,760
but didn't make any money and went out of business.

445
00:25:28,760 --> 00:25:31,760
So how do you go grow but avoid becoming them?

446
00:25:31,760 --> 00:25:36,760
A few of them make a lot of money when they went to the market

447
00:25:36,760 --> 00:25:40,760
and a few people make some money there in the way.

448
00:25:40,760 --> 00:25:44,760
Not the investors probably, but the founders, probably they make money.

449
00:25:44,760 --> 00:25:48,760
Well, I don't like the idea to have investors in my company right now.

450
00:25:48,760 --> 00:25:52,760
Because they try to grow too quickly.

451
00:25:52,760 --> 00:25:56,760
They start growing, growing, growing without making sure they have a good reputation

452
00:25:56,760 --> 00:25:58,760
and making money on the whole time.

453
00:25:58,760 --> 00:26:02,760
Like we don't open more properties if we are not making money in the old one.

454
00:26:02,760 --> 00:26:04,760
Maybe we have one bad or two bad.

455
00:26:04,760 --> 00:26:08,760
But Selena just opened, opened, opened, opened, and then the quality were bad.

456
00:26:08,760 --> 00:26:11,760
And they get too expensive on rent.

457
00:26:11,760 --> 00:26:19,760
I think all the brokers make a lot of money because what Selena paid for the properties was insane.

458
00:26:19,760 --> 00:26:22,760
Like I would never pay that much money.

459
00:26:22,760 --> 00:26:24,760
Like you cannot make money with this rent.

460
00:26:24,760 --> 00:26:27,760
And the brokers, they say, oh, we have this beautiful location, rented.

461
00:26:27,760 --> 00:26:29,760
I don't know, so much money.

462
00:26:29,760 --> 00:26:33,760
And they just rent and start working, hoping in the future they will make money.

463
00:26:33,760 --> 00:26:40,760
And then when things go bad, these kind of expensive, too expensive rents, they just went.

464
00:26:40,760 --> 00:26:43,760
I don't know how they could make money with those rents.

465
00:26:43,760 --> 00:26:45,760
Yeah.

466
00:26:45,760 --> 00:26:47,760
Yeah, I don't know. And it's interesting.

467
00:26:47,760 --> 00:26:50,760
I don't know if you see the same thing at your location, but I feel like the travelers in Mexico,

468
00:26:50,760 --> 00:26:54,760
the market is like kind of party and serve.

469
00:26:54,760 --> 00:26:58,760
There's kind of that backpacker party serve and then there's kind of luxury.

470
00:26:58,760 --> 00:27:02,760
And you got to kind of be in, you got to go one way or the other to really fill up.

471
00:27:02,760 --> 00:27:05,760
And I feel like Selena was kind of like luxury budget.

472
00:27:05,760 --> 00:27:09,760
So there was kind of like they missed the mark because the opt-in, there wasn't the vibe.

473
00:27:09,760 --> 00:27:11,760
It was too corporate, too big.

474
00:27:11,760 --> 00:27:13,760
So travelers said, I just didn't get to meet anybody.

475
00:27:13,760 --> 00:27:16,760
It's nice, beautiful product, but it just didn't have the community vibe,

476
00:27:16,760 --> 00:27:21,760
even though they tried to put on the events or you go with the luxury vibe.

477
00:27:21,760 --> 00:27:26,760
Maybe the ones they have in Panama or the first one that was much more focused on the experience.

478
00:27:26,760 --> 00:27:33,760
You cannot grow like 10 hotels per month or like 50 hotels in a year and have managers and experience team.

479
00:27:33,760 --> 00:27:36,760
There is not so many professionals on the industry.

480
00:27:36,760 --> 00:27:38,760
Like it's a new industry.

481
00:27:38,760 --> 00:27:43,760
You cannot find 50 managers with 10 years of experience.

482
00:27:43,760 --> 00:27:48,760
So they can open, open, open and they will have, it was a hotel with beds and no experience team.

483
00:27:48,760 --> 00:27:54,760
But the first one, Selena probably the ones in Panama and Costa Rica, they were really nice and good.

484
00:27:54,760 --> 00:27:56,760
And you have very nice views.

485
00:27:56,760 --> 00:28:06,760
Lucky us in Mexico, they probably have the worst management because all Selena in Mexico were really, really bad managed compared with the other countries they have.

486
00:28:06,760 --> 00:28:12,760
What do you do to when you're opening your new locations to get that vibe right and get it off on the right foot?

487
00:28:12,760 --> 00:28:23,760
Again, we can relate to this, but I'm interested in your perspective as it's a very tricky dance to open up a new location and then leave and make sure that it stays on course.

488
00:28:23,760 --> 00:28:32,760
What do you focus on to try to make sure it gets off on the right foot and you can leave and it stays on the right foot as you had envisioned?

489
00:28:32,760 --> 00:28:36,760
Well, I would say like we have a big family team.

490
00:28:36,760 --> 00:28:44,760
Like we have friends inside the company like we go on holidays with our teammates and workmates.

491
00:28:44,760 --> 00:28:54,760
Right now, a lot of people, even we have a lot of people from other countries working on the company, but even Mexican people, they are not from Tulum.

492
00:28:54,760 --> 00:29:00,760
They are not from from Bahia or Canada because these are all tourist destinations.

493
00:29:00,760 --> 00:29:02,760
So it's people from Guadalajara and Mexico City.

494
00:29:02,760 --> 00:29:08,760
So they leave their family behind and we have a really family like team.

495
00:29:08,760 --> 00:29:18,760
So the managers and the leads of the company have been with us for like 10 years, 7 years, and they all start like receptionists or volunteers.

496
00:29:18,760 --> 00:29:24,760
So that keeps the staff is a really hostile staff.

497
00:29:24,760 --> 00:29:27,760
They really enjoy being in the hotel.

498
00:29:27,760 --> 00:29:38,760
So that keeps the vibe. You know, when you find a manager, you know that he used to be in the bar, then he went to reception, then his friends from these other guys who work together because the family are abroad.

499
00:29:38,760 --> 00:29:41,760
So that keeps the team really connected.

500
00:29:41,760 --> 00:29:44,760
Most of them, you know that they work and they go home.

501
00:29:44,760 --> 00:29:49,760
They work and they go home and they come to the bar because their friends are their workmates.

502
00:29:49,760 --> 00:29:54,760
And that keeps the vibe in all the destinations working.

503
00:29:54,760 --> 00:29:59,760
The only thing I'm seeing the last time is like managers are getting old.

504
00:29:59,760 --> 00:30:02,760
We all get old.

505
00:30:02,760 --> 00:30:04,760
But you cannot have the same.

506
00:30:04,760 --> 00:30:07,760
You know, you see the guys, they are always the same age.

507
00:30:07,760 --> 00:30:11,760
I don't know what they do. They always train.

508
00:30:11,760 --> 00:30:20,760
So if the managers are getting kind of the 30, 35, something like that, then they start getting like they don't have the energy they have when they are 25.

509
00:30:20,760 --> 00:30:23,760
They need to go in now to talk to everyone.

510
00:30:23,760 --> 00:30:28,760
And you cannot have the same problems and problems like one year, second year.

511
00:30:28,760 --> 00:30:33,760
After a few years, you start getting tired as a manager to deal with these kids.

512
00:30:33,760 --> 00:30:39,760
The UK is 20 something, breaking the wall or they are smashing things because they are drunk.

513
00:30:39,760 --> 00:30:44,760
So you need to keep the managers and receptionists full of energy.

514
00:30:44,760 --> 00:30:49,760
So I'm seeing that now you need to keep a young team, to be honest, to work.

515
00:30:49,760 --> 00:30:54,760
Because it's kind of it's a we're on the beach. So it's surf. It's party going on.

516
00:30:54,760 --> 00:30:58,760
People on the beach are more wanting to going out.

517
00:30:58,760 --> 00:31:08,760
So you need to have people who is willing to accept to have like a destroyers get they're going to get high, get drunk, breaking the rules, everything.

518
00:31:08,760 --> 00:31:12,760
And as the manager, they are getting tired after a few years with the same issues.

519
00:31:12,760 --> 00:31:14,760
Again, this guy again, this happened.

520
00:31:14,760 --> 00:31:21,760
So they start losing connection with the guests and also with the employees because employees have made the same problems also.

521
00:31:21,760 --> 00:31:25,760
Sometimes they are worse than they get.

522
00:31:25,760 --> 00:31:27,760
So that's the only thing and keep growing.

523
00:31:27,760 --> 00:31:35,760
Allow us to move the managers or the reception leader to like more to have like a panoramic view of the company.

524
00:31:35,760 --> 00:31:40,760
So they are working two or three properties so they can manage delivery, be focused.

525
00:31:40,760 --> 00:31:45,760
And you keep the youngest connecting with the people on the front.

526
00:31:45,760 --> 00:31:51,760
I would say like that we have a big family, which was difficult to build.

527
00:31:51,760 --> 00:31:56,760
But right now, a lot of people, they can have better salaries in other and five stars hotels or whatever.

528
00:31:56,760 --> 00:31:58,760
Because it's a really big family.

529
00:31:58,760 --> 00:32:08,760
They when they have to leave, they really think about they really enjoy working and working with their teammates and enjoying the parties with the guests and with their teammates.

530
00:32:08,760 --> 00:32:11,760
But that also brings the other side.

531
00:32:11,760 --> 00:32:15,760
They go out, they drink, they get laid between each other and then they fight.

532
00:32:15,760 --> 00:32:24,760
And then you have a romance and you have people complaining and they get all the problems when you go to another country, 25 from the beach party.

533
00:32:24,760 --> 00:32:29,760
Things happen.

534
00:32:29,760 --> 00:32:30,760
That's so true.

535
00:32:30,760 --> 00:32:35,760
But great advice to look at it and build it like a family.

536
00:32:35,760 --> 00:32:38,760
Those are pillars in the foundation.

537
00:32:38,760 --> 00:32:53,760
And then if you grow from there, I find that going in that, promote from within, build that family style atmosphere, you do get people that stay, that put a value on that quality of life and happiness that you provide within that.

538
00:32:53,760 --> 00:33:00,760
And then that inspires the people beneath them to want to stay as well.

539
00:33:00,760 --> 00:33:14,760
Yeah, it's actually, unfortunately, it's not a very common thing to find because there's so many more corporate style structures and big box style companies that you're not going to get that intimacy of a family style run operation.

540
00:33:14,760 --> 00:33:22,760
We just got our baby size I.T.H. shirts for Bobby's kids and some of the other managers that are now having babies and whatnot.

541
00:33:22,760 --> 00:33:27,760
So, you know, I think that's a great thing to create that culture.

542
00:33:27,760 --> 00:33:36,760
I laughed somebody I took my kids in there for we're doing one of the parties of the hostel community night and I had my kid run around in there and one of the guests was like, what is this a nursery?

543
00:33:36,760 --> 00:33:38,760
And I was like, damn, that's it.

544
00:33:38,760 --> 00:33:45,760
I'm that old guy with the kid, you know, hanging out the hostel messing up the vibe so I can relate to that.

545
00:33:45,760 --> 00:33:50,760
But yeah, they get out.

546
00:33:50,760 --> 00:33:58,760
Yeah, it's a groundhog day. But but and before you go, we definitely want to get some insight on the Naha conference coming to Playa del Carmen.

547
00:33:58,760 --> 00:34:00,760
We're excited that it's going to be hosted there.

548
00:34:00,760 --> 00:34:10,760
I guess give it give us a little announcement about the you know what you expect and what kind of what the plan is for all the people looking to come to the conference.

549
00:34:10,760 --> 00:34:21,760
Well, we want to make it fun. Definitely. It should be fun. And we would like to have a lot of like activities that include also enjoying the Caribbean.

550
00:34:21,760 --> 00:34:25,760
It's a really April is once we're not here.

551
00:34:25,760 --> 00:34:29,760
April is a really nice weather in Playa del Carmen.

552
00:34:29,760 --> 00:34:40,760
So we want to have like maybe have some spots or some space to just enjoy the swimming pool with a margarita and join Mexican food while sharing knowledge.

553
00:34:40,760 --> 00:34:49,760
And also we have the post-treat to Holbox Island, which is probably one of the most beautiful destination when it's in the good season.

554
00:34:49,760 --> 00:35:11,760
I would like to have like, you know, really a conference that you will share knowledge and we have a really good speakers also like to enjoy the Caribbean and enjoy the Mexican because in when you're in US or Canada, it's more like professional more like cold like more corporate.

555
00:35:11,760 --> 00:35:26,760
Right here we're probably going to be in sandals and shorts and we're drinking and enjoying the swimming pool. So we want to mix like, you know, the vibe in Mexico in the Caribbean of Mexico, plus the connection between a lot of the industry, which is it's always nice to go to a conference.

556
00:35:26,760 --> 00:35:31,760
You know, it's always young people and knowledge people and it's not boring.

557
00:35:31,760 --> 00:35:45,760
Like I am a tea conference where I used to go when I was an engineer. I host a tea conference. I always find happy people enjoying drinking a lot of professionals around create the knowledge that helps us to keep growing.

558
00:35:45,760 --> 00:35:50,760
So it's going to be, I hope it's going to be different. It's going to be Mexican Caribbean life.

559
00:35:50,760 --> 00:35:52,760
Yeah, sounds amazing.

560
00:35:52,760 --> 00:36:10,760
Well, thank you so much for taking the time to be here with us. That's Che Hostels. I definitely made me want to go visit some of your places. I'm putting that on my personal vacation.

561
00:36:10,760 --> 00:36:13,760
Welcome to come and share your knowledge and have some drinks here.

562
00:36:13,760 --> 00:36:30,760
I could be a patron at every one of those bars. I look forward to it and I absolutely look forward to the conference coming in April 2025. Make sure all of you get your tickets and make your travel arrangements.

563
00:36:30,760 --> 00:36:38,760
It's going to be a fun one. And I think it's going to be one of the best conferences for the hostile industry ever. So looking forward to it.

564
00:36:38,760 --> 00:36:40,760
Thanks so much.

565
00:36:40,760 --> 00:36:43,760
Thanks.

566
00:36:43,760 --> 00:37:11,760
See you soon.