AccorHotels¬†is acquiring¬†Onefinestay¬†for at least $170 million (¬£117 million). The company is also committing to a $70 million investment in Onefinestay (¬£50 million) over the next few years. Onefinestay is a London-based startup that provides an Airbnb for high-end homes combined with a hotel-like service for hosts and travelers.
The startup¬†raised $40 million¬†last summer and $80.9 million in total¬†according to CrunchBase. Index Ventures led the first round. It operates in four cities ‚Äî London, Paris, New York and Los Angeles.
‚ÄúWe‚Äôve looked at around 200 companies in 2015,‚Äù AccorHotels deputy CEO Vivek Badrinath told me. ‚ÄúWe‚Äôre really interested in this vertical; private rentals for high-end stays. Our clients are interested in this vertical. And if we follow our clients‚Äô needs then we‚Äôre sure we remain relevant for them.‚Äù
The hotel giant also thinks that it has a lot of knowledge on the hospitality industry and Onefinestay can benefit from it. In particular, Onefinestay cleans and gives you the keys to your place so that you have a consistent, upscale experience.¬†And AccorHotels thinks private rentals and hotels aren‚Äôt a zero-sum game. Overall, the market is growing, and the hotel company wants to take advantage of this trend.
When it comes to Onefinestay, the company won‚Äôt change much. If you want to look at a place on Onefinestay, you‚Äôll still have to go to the company‚Äôs website.
‚ÄúOnefinestay will remain an independent company,‚Äù co-founder and CEO¬†Greg Marsh told me. ‚ÄúWe‚Äôre not going anywhere, the business will continue to be led by the current founders and management team. In many ways, nothing will change in the way we deliver our service.‚Äù
Onefinestay now manages 2,600 properties, and these properties are exclusively working with Onefinestay. ‚ÄúUltimately, we could have continued to build this business as an independent company,‚Äù Marsh said.
Onefinestay has opted for a luxury approach. Compared to Airbnb, the startup is curating each property individually. ‚ÄúWe run our own hotel experience but we run it in private homes. It requires people on the ground, it requires infrastructure,‚Äù Marsh said.¬†And this approach is quite lucrative as Onefinestay agrees on a per-night basis and then handles pricing, listing and everything with a healthy margin of 50 percent on average.
What‚Äôs going to change is that Onefinestay is going to expand much more quickly. The plan is to go from 4 to 40 cities over the next five years. Rome is launching in June, but the company also plans to open in Asia for example.