Capital raised by startups in the Vacation Rental Industry

3,337 views

Published on

Capital raised by startups in the Vacation Rental Industry from 2011-2013 by VRM Intel. Includes data from Airbnb, TruJia, HouseTrip, Vacation Futures, OneFineStay and more.

Published in: Economy & Finance, Travel
  • Be the first to comment

Capital raised by startups in the Vacation Rental Industry

  1. 1. VRM Intel Capital Raised by Startups in the Vacation Rental Industry 2011-2013 November 2013 Amy Hinote | amy.hinote@vrmintel.com
  2. 2. $530 million raised • Over $530 million in disclosed angel and institutional funding has been raised by startups in the vacation rental industry since 2011. • 88% of that investment in consumer facing websites. • Over 72% of disclosed capital has been injected into U.S. companies. 2 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  3. 3. Supporting new players Can the market support these new players? • According to the PhoCusWright’s U.S. Vacation Rentals 2009-2014: A Market Reinvented, “Vacation rentals represent a more than $24 billion opportunity in the U.S., that’s more than one fifth of all hotel room revenue and 8% of the total U.S. travel market.” 3 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  4. 4. Supporting new players • The Vacation Rental Managers Association (VRMA) reported the largest Annual Conference in its history in October of this year and is getting ready for their second annual European Seminar in Bruges, Belgium in December. • HomeAway, Inc. (NASDAQ: AWAY), the current leading marketplace for vacation rentals, is expecting 2013 revenues around $342 million. 4 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  5. 5. Market Saturation? At first glance, the market may appear saturated. However, a closer look into the distribution of injected capital exposes market opportunities. Out of $530 million in funding, over $470 million went to consumer websites with approximately $458 million being spread out among four consumer-facing websites: • • • • 5 Airbnb (U.S.): $318M TruJia (China): $64M Housetrip (UK): $60M OneFineStay (UK): $15.9M Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  6. 6. The Opportunity Remarkably absent is investment in operational activities and services to support this sprouting marketplace. Both Vacation Rental Managers and individual home owners have increasing operational needs: • • • • • • • • 6 Websites Mobile Communications Channel Management Housekeeping Property Management Software Marketing Automation Payment Services …and many more Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  7. 7. The Opportunity Out of $530 million, less than $10 million was raised by companies providing supporting products and services to the vacation rental industry. 7 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  8. 8. The Opportunity “We believe the opportunities for new consumer plays in the vacation rental market are limited with such well-established players like AWAY and now Airbnb so well-entrenched,” said at Turnkey Vacation Rentals. We believe there is a huge opportunity in the value-added-services area of vacation rentals and believe the next wave of VR startups will help round out the guest and home owner experience while working with entrenched players as opposed to competing with them.” John Banczak, co-founder and Executive Chairman, TurnKey Vacation Rentals, a marketing and professional management solution for individual vacation rental owners, who picked up $1.5 million in seed funding from an all-star cast of angel investors. 8 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  9. 9. Competition for VRMs “As the vacation rental industry grows, vacation rental professionals have an opportunity to further define and raise awareness of the professionally managed segment. More than half of the vacation rental market’s total rental revenue now goes to industry professionals, up from 43% in 2007, according to PhoCusWright. For vacation rental professionals this translated to a more than $11.6 billion marketplace in 2012 and the total U.S. vacation rental industry is expected to reach $25.8 billion by 2014.” Heather Weiermann VRMA President 9 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  10. 10. Competition for VRMs With over $470 million injected into consumer-facing websites, online competition for travelers looking to stay in a short-term rental will likely increase, resulting in: • • • • • • 10 Rising online marketing expenses Search Engine Optimization (SEO) concerns Increased focus on customer retention efforts Branding challenges Inventory acquisition and retention efforts Increased demand for revenue management tools and services Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  11. 11. Advantages for VRMs However, there are notable advantages to the addition of wellfunded, visible players in the Vacation Rental Industry: • Increased education and awareness of vacation rentals as a lodging option • More cohesive effort impacting government regulations concerning vacation rentals • Increased options to homeowners and vacation rental managers to reach new guest markets • New and more cost-efficient technology products to help service vacation home management • Less fragmented marketplace 11 Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/
  12. 12. Investment by Company Company Investment Year Company 112,000,000 2011 Travelmob *Purchased by HA 530,000 2011 WebChalet HouseTrip 2,700,000 2011 Airbnb HouseTrip 17,000,000 2011 Inspirato 17,500,000 2011 3,700,000 2011 50,000 2011 Tripping.com 1,000,000 2011 Airbnb 6,620,000 2012 HouseTrip 40,000,000 2012 Inspirato 15,500,000 2012 Inspirato 20,000,000 2012 Luxury Retreats 5,000,000 2012 MyVR 1,400,000 2012 12,200,000 2012 Not Disclosed 2012 Airbnb Evolve Vacation Rental Network OneFineStay.com PayByGroup OneFineStay.com Oravel 12 Investment Year 1,000,000 2012 200,000 2012 200,000,000 2013 BookingPal 1,500,000 2013 Demeuere Evolve Vacation Rental Network 4,000,000 2013 2,700,000 2013 Kigo 2,000,000 2013 Not Disclosed 2013 500,000 2013 1,000,000 2013 64,000,000 2013 1,500,000 2013 Vacation Futures 40,000 2013 Vacation Futures 50,000 2013 100,000 2013 PayByGroup TripRental TripVillas TuJia TurnKey Vacation Rentals Zaranga Amy Hinote | 251-455-4994 | amy.hinote@vrmintel.com | http://www.vrmintel.com/

×