Behind the Scenes of a Backpackers Hostel

Its 3:00 am and my phone’s ringing. Not ideal. I tell myself it’s all a part of my dream, turn over and attempt to bury my head under my pillow. All to no effect. That annoying Nokia tune continues, undeterred by my lame evasive action. I blindly claw my way to the desk and answer the phone. It’s my security guard patiently explaining that one of our guests (who has probably had one too many beers) has now decided to leave Goa at 5 am. So she now wants the receptionist to magically appear and help her clear her bill. What’s worse, she has no cash and can only pay by credit card. I’m in no mood to give away a free stay to a flakey, half-drunk backpacker who has difficulty grasping the profound concept illustrated on our ‘reception hours’ sign. This leaves me with only one option. I’m going to have to wake up and trudge back to the hostel at an hour when no sober man should be walking the streets of Goa, leave alone Vagator (tiny beach-side village swarming with nocturnal 60 year old hippies). What’s worse is the entire ordeal has to be borne with a smile.

Fast forward a few hours and I bump into the same woman at breakfast. She cheerfully tells me that she has now decided to stay another night because the buses didn’t work out (at 3 am!!…you think??). It takes considerable self-control to not tell her that she has the IQ of a mentally challenged goat.

You see, it’s all part of the job – Backpacker Hostel Owner.

Running a hostel in paradise is every backpackers dream. Free money, interesting people, no boss, no work, beer all day long and truckloads of beautiful women or hunky men passing through. Unfortunately this couldn’t be further off from the truth. Except of course for the truckloads of beautiful women passing through (beauty obviously indirectly proportional to brain processing power).


Now let’s put aside all those vivid images of a truckload of women and get back to the scenario of owning a backpackers hostel.

From the outside, the romantic in you could take over and conjure up a dreamy, surreal, simple existence, free from the clutches of corporate slavery and the materialistic reality of our 21st century world. This is true in its entirety. But the story is incomplete. Figuring out the perks of the job is the easy part. Even a 5 year old with an active imagination could do that for you. What happens behind the scenes is something that is not so apparent.

The entire hostel is now equivalent to a monkey on your shoulder. And it’s a spoilt little monkey that wants all your attention. So now, drinking a beer on the beach while worrying about making next month’s rent isn’t so much fun anymore. But money aside, there are bigger things to worry about.


By far the biggest challenge in the backpacking business. In India, you’ll have to wade through endless layers of red tape and bureaucracy cleverly designed to push you to the point where you pay a bribe only to preserve your sanity. The administrative fee associated will always be so laughably small that it might convince you that this bribery based system actually works (another discussion another time). Compare this to Europe where you probably need a license for drunk backpackers to take a piss in your garden. However you can be assured that this process is well documented and can even be completed online. It will unquestionably be accompanied by a hefty and equally ridiculous fee. Be it the paranoid legislation of Europe or the bribery fueled bureaucracy of India, business licenses will account for more than a few grey hairs.


This one’s a biggie since you will be dealing predominantly with the minimum wage workforce. In Goa, with 91% of the adult population drunk before lunch, it’s difficult to find reliable staff. And once you find them, teaching cats to do backward flips is as realistic as teaching uninterested folk to sort thrash. Maybe I’m being a bit too harsh because people here live in a simpler age. However, backpackers don’t live in the same age and this means that its your job to bridge the gap which eventually leads to you pulling out all the grey hairs (earned in the previous step).


Rowdy Australians breaking the commode, hormonal Germans breaking the freezer door (twice in one week), small soft-spoken Japanese men committing unspeakable atrocities on dead chickens in the kitchen, frisky couples ruining the hammocks, trigger happy American teenagers destroying the flush – the list is endless. Budget 4 hours a day on picking up behind people. On the bright side, you will get very good at fixing bathrooms. Let’s hope you can put that on your resume.

behind the scenes


While doing all this you know at the back of your mind that if people don’t make as many bookings next month, you might not be able to afford that Ferrari before you turn 30.

Guest relations

Take a break from it all, crack open a beer and have a chat with the World-savvy lot currently occupying the hostel. Be warned that if they find out you’re from the hostel, they’ll spend a minute telling you how you’ve got the best job in the world and the next 10 minutes asking you for elaborate directions to the ATM. This is when they’re in a good mood. If a member of the opposite sex spurned their advances the previous night, you either run for shelter or bring out the heavy artillery. If it’s any consolation, the hostel owner ALWAYS wins any battle of words. If some smart-ass backpackers do happen to win an argument, them being unceremoniously booted out onto the street is an automatic disqualifier and you become the winner again.

Who knows what else

Given my confidence that the Fire License Department is oblivious to the existence of a computer, let alone this blog, this is my latest addition to the list of worries. My cleaner “accidentally” set a coconut tree on fire (I don’t want to talk about it) which drove home the point that a random event completely out of your control could take it all away in a heartbeat.

Don’t get me wrong. All this isn’t terrible. It’s just a part of the job. A part that often is carelessly glazed over by people building sand castles in the air. As a hostel owner, every morning I wake up with a choice – beer, beach and babes or spending time training my staff, worrying about finances and figuring out improvements to the hostel. On most days I choose the latter for numerous reasons – the challenge, satisfaction and freedom that comes from creating something from nothing.

So if your retirement plan involves setting up a backpacker’s hostel by the beach so that you can drink beer all day long with beautiful members of the opposite sex, I’d suggest you take the easy way out, book the first flight out to Goa and stay at Jungle Hostel *.

* Do note that we have a 1 month maximum stay policy.

If you’re still convinced that this is the right path for you, then be sure to check out a new course that I have just released to help you start your own hostel.

How to start a backpacker hostel

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27 Comments on “Behind the Scenes of a Backpackers Hostel

  1. Pingback: How to Start a Backpacker Hostel | theOrangeMango

  2. Hi,i am planning to start a backpacker/hostel in malaysia. Is it viable if my target market will be for airport transit pax n students..?

    • Sure. Why not? Just ensure that you’ve got the location nailed and that your business plan works out for you.

  3. Hello, I am looking into opening a hostel in Dominican Republic. Generally, it takes a business 5 years to generate profit, do you feel this is the case with running a hostel in an economically affordable location?

    • You should be able to generate an operational profit within the first year. How long it takes you to break even on the other hand – that depends on how much you spend and how much revenue you can generate.

  4. I am also thinking of opening a hostel in Brasil and would love to ask some questions. Can I get your email address? Cheers for all the useful information.

  5. I’ve just got the idea that I would like to run my own hostel.
    Preferably in Amsterdam or Barcelona because those are my favorite cities to backpack to.
    Could you give me just a general idea of how much it would cost to get started? (example: $250,000, $300,000,$350,000 etc.)

  6. Hi, can you suggest few sales and marketing strategies for a backpacker hostel and how should a business plan be worked out for the same.

    • the best sales strategy is to be the best hostel and offer great value for no money 😀

  7. Backpaper hostels are new to our dealings. People consious to face many compliments. Suggesting new sales marketing hostels will help us too.

  8. I’am interested in setting up a hostel in Anjuna, would you consider collaborating on a hostel, or helping as a sort of consultant? let me know would be awesome.

  9. Hi Jason
    Excellent blogs.
    Even I am plannig to start up a backpackers hostel. Though it’s still in ideation phase and am still considering locations. Just wanted to know what kind of legalities can I expect to deal with, like licenses or permits or something.

  10. Hi Jason. Great blog and very accurate. I set one up in New Zealand a few years back, The Piha Palace, and it was great for a couple of years. As you say, hard work, but so much fun too. Never before have fun and stress been Siamese twins. What’s the best way to find a place to rent in Goa? Is there a website or is it just a case of heading over there and scouting? I have a two year old now so that’s only going to add to the challenge!
    Cheers, Rob

    • Hi Rob – online rental will not work. You’ll have to be put in some ground work. Also – I hope you have a legal work visa because Goa is cracking down on non-residents who setup businesses without legal permission. Cheers

  11. Hi do you mind sharing what’s the average amount you need to set up a hostel.. I am interested in setting one in Cebu, Philippines. I am new to this but I’d love to hear from you.

    • The amount depends on the rent, salaries, etc etc and will vary from location to location. Just start off by creating a budget and documenting known costs and assuming other logical setup expenses that you don’t have.

  12. Hello,

    would you think it would be safe for a single woman (35-45 yr old) to set up an Hostel? Or is it the trade mostly of men? I’m not speaking of dangers or crime rate related to specific cities or countries, but more in general regarding Hostel business, considering I would be aiming for a beach town in Central or South America.

    Thank you

    • Hi Isabelle – I doubt that other than location specific crime you’ll have any safety trouble with your hostel. You’ll always have the case of a lone backpacker who steals peoples money and phones but there’s little you can do about that other than encourage all guests to use the lockers and be careful with your stuff. As for the trade being full of men, this isn’t a job where you go to the office and work with male colleagues – you’re the boss and you get to hire your own staff 🙂

  13. Hi Jason, thanks for this fantastic blog!

    We are about to start a hostel in Malaysia and thought it was a good a idea to start volunteering in a hostel first, so we learn better how to do it.

    The thing is that we are not sure how to get a Visa longer than 3 months… how did you do that?

    And other question, how much investment you need for a start? We can afford to start with about USD 18K…

    Thanks again! Any help would be really appreciated!

  14. Great articles, thank you for sharing some of the “behind the scenes” stuff most people forget about. I was hoping you could give me your opinion- I’m fortunate enough to have parents who own some land in Mexico. It’s paid for (no rent) and a guest house will be built out which could function as a hostel/ guest house/ B&B. The bad side is that it is off the beaten path- like 2 hours on a bumpy road. It’s technically beach front property, but far away from it all (solar powered only). Would you recommend a backpacker hostel to appeal to surfers? Or a guest house to “get away from it all”? I would really like to make some revenue to help pay for my parent’s retirement. I’m just trying to pick a right angle. Oh, and it’s situated right next to a fishing village with lobsters, fish, etc.

    • Hey Brianna – sounds like a great place. If you put your mind to it I’m sure you can create a destination out of it. However, as with most other things in life, I think this will require time, effort, commitment and a lot of hard work. This will not be a get rich quick option so if you don’t intend to invest at least 5 years into this, do not gamble your savings into creating a hostel as a retirement fund.

  15. Hi Jason,

    It was good to read your blog. I have experienced the hostels in Goa and really commend you and the team.
    What is your take on backpacker hostels in the Indian Himalayas? From your travels and experiences, do you think they actually offer what they should or there is loads of potential still. I am in the process of completing my research on backpacker hostels in the Indian Himalayas (specially the Northern). Would be great to hear your inputs.


    • Hey man – thanks. I think there’s a lot of scope in the Himalayas. Some beautiful places to explore up there and guest houses just aren’t that social. There aren’t too many hostels up north (yet) and I definitely think a few hostels up there would be welcome 🙂

  16. Hey Jason,

    Just wanted to check the initial investment required to setup hostel in Goa ?


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