Hostaway raises US$175M funding for growth and global surge

 Hostaway raises US$175M funding for growth and global surge

Image courtesy: Hostaway

Leading vacation rental software platform, Hostaway raises a sizeable US$175 million in funding from PSG, a growth equity firm. The company claims that the Hostaway funding is the largest in the vacation rental software sector to date.

Hostaway’s vacation rental software platform and management system caters primarily to property managers. It helps them streamline operations, manage bookings, automate tasks, and enhance guest experiences. The software solution seamlessly integrates with popular vacation rental platforms like Airbnb, Vrbo, and Booking.com. As a result, Hostaway empowers property managers to efficiently handle multiple listings across various channels. The company has a global footprint with hubs in Finland, Canada, and Spain.

“We are thrilled to partner with PSG, as we continue to elevate the vacation rental industry and unlock value for property managers beyond what had been thought possible. We have operated with incredible speed and efficiency, balancing growth with our current strong profitability, and this investment represents a significant milestone in our journey toward global market leadership. We’ve come a long way, but we are just getting started. The opportunities are endless!”

Marcus Rader, CEO and Co-Founder of Hostaway

With the latest cash infusion, Hostaway says it will scale operations, invest in product development, and expand the team. This funding will also drive the enhancement of the software platform and creation of new features. Further, it will aid in delivery of robust tools for property managers. Moreover, it will support Hostaway’s global expansion, enabling it to enter new markets and strengthen its presence in existing ones.

Also read: Rental industry startup by school kid gets US$1M funding now

Hostaway raises from PSG, which focuses on software & tech-enabled services companies

PSG is typically an investor in software and technology-enabled services companies and was founded in 2014. It has offices in Boston, Kansas City, London, Paris, Madrid and Tel Aviv, and has backed 120 companies till date.

“We are impressed with the quality of the Hostaway team, their vision and execution in building what is, in our view, a highly differentiated category leader with multiple levers of value creation. We believe the company has a significant opportunity to lead this industry, as it continues to scale its integrated platform, expand globally and help its customers meet the growing demand in the short-term rental market. Look forward to partnering with Hostaway in this new exciting chapter.”

Edward Hughes, Managing Director at PSG

The rising popularity of short-term rentals as an alternative to traditional accommodations has fuelled tremendous growth in the vacation rental market in the past decade. As the category rebounds after Covid-19 pandemic, Hostaway claims small property owners are increasingly outsourcing to property managers and digitizing their operations, a huge opportunity for the company.

Vista Point Advisors, a SF-based boutique advisor, was the exclusive financial banker for Hostaway, as per the release.

Hostaway funding minimal prior to this huge raise

Marcus Rader (CEO), Saber Kordestanchi (COO), and Mikko Nurminen (CFO) founded Hostaway in 2015. The company, headquartered in Toronto, has emerged as a market leader in providing comprehensive solutions for marketing, sales, management, reporting, and communication for vacation rental property managers.

It seems that Helsinki, Finland, was the original headquarters of the company, till early 2018. As per some news reports, the company raised US$865K from undisclosed investors in February 2018. Prior to that, the company also raised about US$180K in equity funding and the Finnish state gave it a grant via Business Finland. Hostaway seems to have relocated its headquarters to Toronto by November 2018. This is when Betakit reported its US$1.9M seed round, led by Finland-based venture capital firm Vendep Capital. The company was also supported by Toronto’s DMZ, Toronto’s leading tech start-up accelerator.

The company claims that its revenues have scaled over 10 times since 2021 and it has achieved profitability as well. Further, it notes that its customers manage over 100,000 properties in more than 100 nations, put together. And says that Google, Expedia, Tripadvisor and Homes & Villas by Marriott have entered preferred relationships with Hostaway.

As per Tracxn data, Mews (UK), Guesty (US), Lodgify (Spain) and Cloudbeds (US) are other competing players in the domain.


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