Guesty, a startup whose software helps property managers operate and market their short-term rentals for travelers, said on Thursday it had acquired a smaller rival, MyVR.
The companies didn’t disclose the terms of the sale. The investors in MyVR, which had raised about $7.5 million in funding, sold their stakes. Guesty said it was keeping all of MyVR’s employees.
The deal effectively makes the combined company the largest short-term rental property management software maker worldwide, the companies said.
“When we say leading, we mean by the number of connected listings, by booking volumes, and by funding,” Vered Schwarz, president and chief operating officer of Guesty. “We’re creating a mega-brand for short-term rental tech.”
The U.S. market makes up more than half of each brand’s customer base, though the companies also operate in dozens of other countries.
Broader Short-Term Rental Trend
The acquisition highlights an under-the-radar market for software. As travelers look to Airbnb and its rival booking sites for apartment stays, they’re increasingly seeking professionally managed and licensed units — with clean towels, contemporary furniture, and contactless entry. Full-time property managers increasingly turn to software to help them manage their growing short-term rental empires — an opportunity that Guesty and other startups look to exploit.
As alternative accommodations shift from spare guestrooms and cottages to institutional real estate, venture capital is backing makers of digital tools for this segment.
Both Guesty and MyVR primarily target full-time property managers rather than amateur or individual hosts. The startups have tools that help managers with their operations, such as tracking housekeeping assignments. They also offer marketing help, such as how to optimize listings on reservation services such as Airbnb, Booking.com, and Vrbo.
Guesty was founded in 2013 at Y Combinator, a startup accelerator in San Francisco. It raised $35 million in Series C funding in early 2019.
“We hadn’t touched that money when the pandemic started because we were very efficient, and we were growing very nicely,” Schwarz said.
“So we came into the pandemic with a very large cash cushion,” Schwarz said. “That allowed us to remain calm and take the necessary measures to continue to grow during the pandemic.”
MyVR, which also launched at Y Combinator, has been a rival to Guesty. The companies have had overlapping products, but MyVR has focused more on tools to help property managers market online, such as with a website builder. In contrast, Guesty has focused more on operational aspects, such as managing inventory and communicating with guests digitally.
Schwarz said management would have to review the strengths and weaknesses of the different brands’ products. But the early instinct of executives is to maintain the two brands.
“Currently, we believe we’ll find a way to give different flavors of the offerings to different customer types and differentiate the Guesty and MyVR offerings to offer the right product to the right customers,” Schwarz said.
MyVR might focus perhaps more on managers with smaller portfolios. Guesty might instead emphasize catering to enterprise customers, such as owners of multi-unit buildings. Guesty has seen many of its largest customers acquire more apartment hotel units in recent years. In the past year, the company has developed more tools to streamline data collection and analysis for accounting and financial reporting, which are more of a burden for larger management companies.
Guesty’s management will keep its focus on serving the short-term and vacation rental markets, Schwarz said.
Staying focused isn’t easy for any company in the sector, though. The borders separating short-term rental and vacation rental inventory from other travel categories are getting hazier. Traditional hotel stays, extended stay apartments, and outdoor offerings like glamping increasingly gain interest from investors who hold overlapping portfolios in alternative accommodations, too.
In the past year, Guesty has added functionality to help property managers with multi-unit listings organize their batches of inventory. In some cases, the startup aims these tools at owners of full buildings that offer rental apartments run as “apart-hotels.”
From left: Vered Schwarz, president and chief operating officer of Guesty, and Amiad Soto, co-founder and CEO of Guesty.
“Managing multiple units sounds like a minor thing, but it’s very complex on the back-end,” Schwarz said.
But the company says it isn’t trying to do everything for everybody with its software. It especially isn’t trying to serve traditional hotels, which may have a centralized group of housekeepers and a centralized restaurant or food service.
“We’re not targeting hostels, and we’re not targeting large hotels or hotel groups,” Schwarz said. “Our focus is on full-time, professional property managers with short-term rental inventory, which may have their units distributed at various addresses or might be owners of multi-family units with some available for rent to travelers.”
“Some of our clients have been growing into larger enterprises, especially in the U.S. on the strength of Airbnb’s growth and the post-pandemic recovery,” Schwarz said. “So we’ve been developing more sophisticated software to help match their shifting needs.”
Photo Credit: A Nord-branded apartment hotel in København, Denmark. Nord uses Guesty as a tech vendor. Guesty, a startup that simplifies the operation and marketing of short-term rental and vacation rentals, has bought smaller rival MyVR. Nord
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April 08, 2021 at 07:01PM
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