Japanese vacation rental management provider H2O Hospitality has raised $7 million in a Series B funding round from Samsung Ventures, Stonebridge Ventures, IMM Investment, and Shinhan Capital, the company announced on Monday.
The latest investment brings the startup’s total funding to $18 million.
Founded in 2015 as a South Korean cleaning firm, H2O acquired a number of online/off-line accommodation management companies in Japan.
The startup, which now provides 5,000 rooms on its platform, manages accommodation facilities without any on-site human resources. It also helps landlords manage the operations, booking, and housekeeping through its platform.
“H2O has already proven product-market fit within Japan, and we expect them to continue to thrive as they expand outside of major cities.” Samsung Ventures senior investment manager Eric Kim said in a statement.
The proceeds from the funding will be allocated to support the startup’s working capital needs on the back of their strong growth every quarter. H2O’s revenue has been doubling every quarter since the third quarter of 2018.
In June 2018, Japan implemented Minpaku (private lodging) Law, which legalized short-term vacation rental through online platforms following the shortage of accommodation place, citing the tourist boom as the main reason. The regulation prompted a number of vacation rental platforms to emerge in Japan.
Since 2017, the company has been selling its rooms through 25 different global and local OTAs directly connected with their property management system.
H2O’s average daily rate in 2019 was around $160 with an average occupancy rate of 87 per cent.
Samsung Venture Investment Corporation is the venture capital arm of South Korea’s conglomerate, Samsung Group. The firm previously invested in Indonesia’s proptech startup Travelio’s Series B funding round.