DSG Consumer Partners-backed Hostmaker raises $6.5m in new round

Hospitality management service Hostmaker, headquartered in London, and backed by Singapore-based VC firm DSG Consumer Partners, has closed a new $6.5m funding round led by Paris-based venture capital fund Ventech. Existing investors DN Capital and DSG Consumer Partners, also participated in the round.

Founded by Nakul Sharma, Hostmaker’s business model involves being  a full-service Airbnb management company, where homeowners don’t have to get involved in managing the short-term rentals of their properties. The latest round takes the total funding Hostmaker has raised to $9.3 million (£7.5m), and the company claimed this this was more than any of its European hospitality management competitors, even as it added that it had grown 8X since inception in 2014.

The company competes with the likes of airsortedOnefinestay and pillow in the U.S. among others.

Hostmaker, in a statement said that the funds will be used for strengthening its leadership position in its existing markets London, Paris, Rome and Barcelona, which it said were four of the largest global markets for Airbnb. Hostmaker said it currently supports more than 1,000 homestay hosts in these four cities and foresees opportunity for extensive growth with 100,000 Airbnb listings currently active across the markets.

The company said it has pipeline interest from 25 cities across the globe and added that it was carefully analysing opportunities to expand its service. Moves into cities in Asia such as Tokyo, Hong Kong, Singapore and Sydney are being explored, where Airbnb is experiencing the fastest growth, it added.

Hostmaker also said it was considering the possibility of acquiring smaller high quality operators, in a premium homestay segment that has seen much recent consolidation such as Airbnb’s acquisition of Luxury Retreats and hotel group Accor’s acquisition of One Fine Stay.

Explaining its business model, the company’s statement said that it assists hosts with listings, managing guest experience and hotel-style housekeeping, and the service includes the option of working with an in-house interior design team to enhance the appeal of the listed property. “The Hostmaker service represents a hands-off solution for people who want to optimise their renting revenues without lifting a finger. Equally, Hostmaker caters for the new-age traveller seeking to combine the discovery of a homestay experience in a new city with the creature comforts of a premium hotel,” it added.

Nakul Sharma, founder and CEO Hostmaker said: “Our investors back our vision of creating a premium hospitality experience within the homestay segment that is seeing explosive growth. Regulatory changes in all cities have now made short-lets a category offering that is here to stay.

“Over the last few years, we have seen a fundamental change in how homeowners view their home as not just their private space but as a space to be shared, which allows them to monetize an asset and makes living in expensive European capitals more affordable. We are the only ones in our segment now that is rapidly scaling internationally and capitalising on this opportunity for the homeowners by offering proprietary pricing technology, in-house interior design and a five-star hotel trained operations team, all under one roof. We bring the modern homestay together with gold standard hotel-style hospitality, to enhance the Airbnb experience. We grew 400% in the last year, and with a strong senior team, are now aiming for even more ambitious growth this year in all our markets. We want the short-letting experience for homeowners to be as easy as flicking a switch on,” he added.

Alain Caffi of Ventech said: “Thanks to its founder experience in the hospitality industry, Hostmaker brings the most sophisticated capabilities from the traditional hotel operators to the booming on-demand rental business. It brings tremendous value to Airbnb hosts by providing a hassle-free solution rewarding them with best in class yields and to guests by ensuring a consistent level of service on par with hotels. Hostmaker is the perfect enabler to push further the Airbnb revolution in a scalable and profitable way. The team has the professionalism to achieve its long-term vision of being an alternative to hotel groups in the 3 to 4 stars’ segment; this is game changing.”

Nenad Marovac of DN Capital further added: “We are very excited to be backing Hostmaker’s journey to building the ultimate platform for Airbnb and distributed hotel services. This proposition takes all the pain out of letting your home and will become the backbone to the home-rental economy. The Hostmaker management team has excelled over and over again, and is now clearly Europe’s number one player in a fast-growing space.”

“DSGCP is excited to be participating in the newest round of funding having been invested since the seed round in November 2015. Hostmaker has proven the business model in Europe and we will be working with them to assess the opportunity to enter the Asia market which is witnessing significant growth for on demand and sharing services such as Airbnb,” said Deepak Shahdadpuri of DSG Consumer Partners.

Earlier this week, this portal had reported that DSG Consumer Partners (DSGCP) had hit the final close of $40 million for its second vehicle called DSGCP II. The firm raised its first fund DSGCP I in December 2012. DSGCP I invested a total of $24 million in a portfolio comprising 21 companies.

Also Read: India: DSG Consumer Partners achieves final close of $40m for second fund

Airbnb in talks to buy China’s home-rental rival Xiaozhu

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.