As the tourism industry is strongly feeling the impact of the COVID-19 pandemic, the short-term rental industry has seen some remarkable recoveries.
GuestReady, a globally leading short-term rental management company, faced with an 80% revenue decline earlier this year, has quickly recovered and now just launched its public crowdfunding campaign on the leading European crowdfunding platform Seedrs.
This path seems to mirror the one of Airbnb, the global short-term rental behemoth, which was faced with thousands of cancellations earlier this year and which is now set to raise billions in an IPO scheduled for the end of this year.
On 3 November, one day after it’s public launch, GuestReady’s crowdfunding campaign reached 100% of its target. Over 250 investors from 25 countries contributed to the goal of EUR 1.5M. Existing investors Impulse VC and Senn & Partners continue to back the company and are participating in the campaign. The strong demand seen on Seedrs signals recovered investor confidence in this market segment. The campaign is now overfunding and will likely remain open until the end of November.
Earlier this year, such a strong reception from the public would have been unthinkable. From January to April, GuestReady saw its revenue drop by 80%. Since then, the start-up has been on the path to recovery, with revenues back to pre-COVID-19 levels in August 2020.
“The short-term rental market is not as deeply impacted as some might think by the COVID-19 crisis. The impact on different segments of the hospitality and tourism industry varies quite a lot. Outsiders think that our fate is the same as the one of airlines or hotels, which have seen revenue drops of up to over 90%. Luckily we’ve seen increased demand from domestic travellers and for longer stays which have helped to cover a large part of the lost bookings from international travellers. This has allowed GuestReady to maintain a much higher occupancy compared to hotels.” explained Alexander Limpert, CEO and co-founder of the company.
A comparison of GuestReady’s occupancy data for September with hotel occupancy data from STR, the leading hospitality data provider, shows that GuestReady’s occupancy is almost double the average hotel occupancy in key markets such as Dubai, Paris, Lisbon, or London. Apart from occupancy, the company saw its average length of stay increasing by 50%, as guests book for longer periods of time.
“In current times, short-term rentals offer key benefits compared to hotels.” Jacques Lavie, Head of Growth at GuestReady notes. He adds: “Our properties are better isolated and don’t contain common areas, such as a lobby, which would usually be an advantage of a hotel. All of our properties have superfast WiFi, which is even more important now as many more guests work from home. Our guests also love the fact that they have their own kitchen where they can cook themselves, rather than being dependent on going to restaurants.”
