DripStop

Idea

DripStop scans a short-term rental management company's own direct-booking website for the hidden cleaning, pet, damage-waiver, and service fees that the FTC's 2025 junk fee rule now makes illegal to disclose late. It's a compliance auditor built specifically for the pricing-disclosure gap: every existing STR compliance tool watches city permit and registration rules, none of them watch whether the operator's own checkout flow still adds fees after the advertised price, which is exactly the violation the FTC has now fined two travel booking companies for in 2026.

Market gap

The FTC's Rule on Unfair or Deceptive Fees took effect May 12, 2025, and it explicitly covers short-term lodging, including independent short-term rental (STR) operators, not just hotel chains. It bans "drip pricing," the industry-standard pattern of advertising a low nightly rate and adding a cleaning fee, pet fee, damage waiver, or service charge later in the booking flow. Airbnb updated its own marketplace display in April 2025 to show fees upfront. But STR management companies also run their own branded direct-booking websites (via Lodgify, Hostfully, OwnerRez, Hospitable, Guesty for Hosts, Uplisting, or a WordPress plugin), and on those sites the fee-display setting is entirely the operator's own choice, historically set to show a lower nightly rate for competitiveness. Two federal enforcement actions have already landed against booking companies in 2026 for this exact pattern (Hopper, $35M; StubHub, $10M), and a growing list of states (Colorado, Massachusetts, Virginia, Minnesota, California, Connecticut, Oregon) have passed their own hidden-fee laws on top of the federal rule. The timing is now: the rule is over a year old, enforcement has moved from warning letters to real settlements, and small STR managers who never touched their booking-widget fee settings are sitting on exposure they don't know about, with no dedicated tool to check.

Total Addressable Market (TAM)

Bottom-up, with assumptions stated:

• Hostaway, one PMS/channel-manager vendor, publicly states it supports 100,000+ properties globally.
• Assumption: roughly 50% of that base is US-based, since the US is the largest STR market by both listings and revenue in every industry report reviewed. That's ~50,000 US properties on Hostaway alone.
• Assumption: Hostaway is one of roughly 7 widely used STR PMS/channel-manager platforms serving the independent-to-midsize segment (Lodgify, OwnerRez, Hostfully, Hospitable, Guesty, Streamline, Track, iGMS, Uplisting). Conservatively estimating the combined US professionally-managed portfolio across these platforms at 3x Hostaway's US base gives ~150,000 properties.
• Sourced: 70% of STR operators run a direct-booking website (StayFi VRM Insider, 2026), so ~150,000 x 70% = ~105,000 properties carry direct compliance exposure on an operator-controlled channel.
• Assumption: average portfolio size of 20 units per independent management company in this segment. The two largest national players (Casago, ~40,000 units after acquiring Vacasa; Evolve, up to ~30,000 units) are extreme outliers against a long tail of regional operators, so 20 units is a conservative blended average. That gives ~105,000 / 20 = ~5,250 target management companies.
• TAM: 5,250 companies x $1,560 average annual contract value (blended across the $79/$149/$299 monthly tiers below) = approximately $8.2M ARR ceiling for the US STR direct-booking segment.
• SAM: the subset actively worried about compliance risk after the Hopper and StubHub settlements, estimated at 40% of TAM = ~2,100 companies x $1,560 = approximately $3.3M.
• SOM: realistic Year 1 capture for a small team relying on the free scanner, content marketing, and STR operator Facebook groups/VRMA: 100 to 150 paying customers x $1,560 = $156,000 to $234,000 ARR.

Monetization strategy

Flat monthly SaaS subscription, tiered by number of active listings, billed via Stripe. The management company pays, not the individual host, since the management company owns the booking website and the legal exposure. Revenue durability comes from continuous re-scanning: every time an operator adds a fee, launches a new listing, or a new state passes a hidden-fee law, the compliance status can change, so this isn't a one-time audit purchase, it's standing monitoring.

Pricing strategy

• Starter, up to 20 listings: $79/month. Entry point for small independent operators.
• Growth, 21 to 75 listings: $149/month. Where most professional STR management companies land.
• Portfolio, 76+ listings: $299/month plus $2/listing over 150. Anchored against the cost of a single FTC violation (penalties over $50,000 per violation as of the FTC's most recent inflation adjustment) or an outside counsel compliance review, both of which cost far more than a year of DripStop.
• Entry point: the free single-listing scan converts directly into the Starter tier.

Lead magnet

A free, no-signup "Is My Listing Price Legal?" scanner. The operator pastes one listing or booking URL, DripStop simulates the booking flow through to the final checkout step, and reports in plain English whether the FTC's total-price test would flag it, citing the exact screen and fee where the price changed.

Social proof that the problem exists

• FTC Rule on Unfair or Deceptive Fees, FAQs: confirms the rule took effect May 12, 2025, explicitly covers short-term lodging including independent STR operators, and bans disclosing mandatory fees like cleaning fees only at checkout.
• FTC press release, rule takes effect May 12, 2025: official confirmation of the enforcement start date and scope.
• FTC v. Hopper, $35M settlement, July 2, 2026: the FTC fined a travel booking company specifically for short-term lodging fee violations tied to the May 12, 2025 rule, proving enforcement is active more than a year after the rule took effect, not just a launch-week warning.
• FTC v. StubHub, $10M settlement, April 2026: a second, separate FTC enforcement action under the same rule against a booking marketplace for fees not disclosed in the initial price, showing this is now a pattern of federal enforcement.
• Barnes & Thornburg, "FTC Finalizes 'Junk Fees' Rule," 2025: law firm guidance explicitly naming "independent short-term rental (STR) operators," not just hotel chains, as covered parties, confirming this is a recognized small-operator risk in legal practice.

Competitors

• STR Comply: city-by-city short-term rental regulatory summary reports for individual listings.
• HostReady: monitors daily regulatory updates across 850+ US markets, automated permit checks and renewal workflows.
• GovOS Short-Term Rental Monitoring and Granicus Host Compliance: STR registration, permit, and tax monitoring software, sold to city governments, not to operators.
• Lodgify, OwnerRez, Hostfully, Hospitable, Guesty: the PMS and channel-manager platforms operators already use to run their direct-booking sites.

What competitors offer now

STR Comply and HostReady solve "will I get fined by the city for operating without a permit," a compliance category built around local ordinance registration, occupancy limits, and lodging tax remittance. Neither touches federal or state pricing-disclosure law. GovOS and Granicus sell the same registration/tax-monitoring category, but to municipalities trying to catch unregistered listings, not to the operators themselves. The PMS platforms (Lodgify, OwnerRez, Hostfully, Hospitable, Guesty) let an operator configure a cleaning fee as either bundled into the nightly rate or added at checkout, and the checkout-fee default remains common because it makes the advertised nightly rate look lower. None of them flag that the checkout-fee default is now a federal violation, and none generate a timestamped record proving what a listing displayed on a given date.

What can be done differently to attract customers

Position squarely in the pricing-disclosure gap that the registration-compliance incumbents don't cover, and target the exact question an operator has after reading about the Hopper or StubHub fines: "am I doing this too?" The free single-listing scanner answers that question in under a minute with no signup, the same lead-magnet pattern that works because it gives a specific, personalized answer instead of a generic article. Price it at a fraction of a single violation or an hour of outside counsel, not as an enterprise compliance platform. Ship PMS-specific fix instructions, not just a violation flag, since the real friction for a small operator isn't understanding the law, it's knowing which setting to change in Lodgify versus OwnerRez versus a custom WordPress checkout.