Short-term rental platforms like Airbnb have transformed travel. They've made it easier for tourists to access personalised, private accommodations and for property owners to monetise their spaces.
With global tourism now on track for a full recovery post-COVID, Hostaway has secured a cool $365mn at a $925mn valuation as it looks to cash-in on the boom in short-term rentals.
Hostaway is a property management system (PMS) and software marketplace for the short-term rental industry. It will use the cash to enhance its dynamic pricing tools, further integrate AI, and expand its presence in new markets, focusing on France, Italy, and Spain.
“Expanding into different geographies and investing in innovative AI applications is something we've been hyper-focused on for over a year now,” said co-founder and CEO Marcus Räder in a blog post. “With this new strategic investment, we'll be doubling down on these efforts and much more.”
The company said it was the first PMS to integrate ChatGPT into its platform. Going forward, it plans to add or improve upon AI-powered personalised messaging, content creation, and language translation.
Räder co-founded Hostaway in Finland in 2015, alongside Mikko Nurminen (CFO) and Saber Kordestanchi (COO), at a time when companies like Airbnb were really starting to disrupt a travel industry dominated by hotel chains and guest lodges.
The founders saw that while short-term rental platforms were easy for customers to use, managing stuff like bookings, pricing, and communication was a bit of a headache for property owners. They launched Hostaway to help property managers automate and manage short-term stays across multiple platforms like Airbnb, Booking.com, and Vrbo.
The idea is that by automating tasks and putting the data on a single platform, Hostaway can save property managers time on admin, freeing them up to focus on customer service — critical in a review-based industry. The platform also recently adopted dynamic pricing tools to optimise rates, potentially increasing revenue.
“Hostaway has emerged as a category leader with a differentiated product addressing the distinct needs of short-term rental property managers, a dynamic and growing industry,” said Raph Osnoss, managing director at General Atlantic, a New York-based growth equity firm that led the funding round.
Hostaway also raised $170mn last year in its first big funding round. The company claims its platform is used by customers in over 90 countries. While Hostaway is officially based in Toronto, Canada, it employs a fully remote workforce of over 230 employees across 44 countries.
Hostaway is one of a cohort of tech startups raising big money to make things easier for the hospitality industry. One of them is UK-based Lighthouse, which raised $370mn in November to expand its data intelligence platform for hotels. Another is Amsterdam-based Mews which raised $110mn in March at a valuation of over $1.2bn, becoming the first Dutch unicorn of the year. Then in September, it bagged another $100mn, to further develop and expand its PMS software.