Travel and tourism have made a triumphant return to the forefront of consumer and business priorities. To further prove this trend, a startup specializing in software for the industry has recently sealed a major funding round. Guesty, which offers a comprehensive platform for accommodation managers to oversee their operations on platforms such as Airbnb, Vrbo, and direct to travelers, has announced a successful raise of $130 million.
It’s definitely a tough market. In every round I’ve raised, I would always get 40 no’s for every yes.
– Amiad Soto, Guesty CEO
The New York-based company, with its roots in Israel, is confident in its ability to turn a profit this year. Moreover, it reported a remarkable 5x increase in revenue over the last three years (albeit undisclosed). Sources informed TechCrunch that the Series F round has valued Guesty at approximately $900 million post-fundraise.
Leading the round is KKR, alongside Apax Funds, BDT & MSD Partners, and Sixth Street who have also joined as investors.
Putting the funding into perspective, the tourism and travel sector has experienced a robust recovery post-pandemic. According to the World Tourism and Travel Council, it is estimated to generate a record-breaking $11.1 trillion in sales globally by 2024. This is despite the United States and China have not yet regained their pre-pandemic strength.
The industry’s upward trend has been evident for the past few years, and numerous startups in the space have secured significant funding. In addition to Guesty, its competitors and other startups have also raised nine-figure rounds. Guesty’s previous round in August 2022, a Series E of $170 million, held a valuation of $690 million. In the same year, its rival Hostaway raised $175 million, marking its first major investment. Around the same time, GetYourGuide cemented its position with a monstrous $194 million raise with a valuation of $2 billion.
Mews, another SaaS company catering to hoteliers, followed suit and raised $110 million in March 2024. This serves as a reminder that investors are still keen on signing deals under the right conditions.
According to Guesty CEO Amiad Soto, even in today’s challenging environment, securing funding has been no cakewalk. “I still got 40 no’s, but also a lot more yes’s,” he joked. Soto, who founded the company with his brother Koby (no longer with the company), has plans to allocate the funds to various areas.
First and foremost, Guesty aims to further develop its current platform for existing customers. Presently, it services “hundreds of thousands” of properties, as per Soto’s unwillingness to disclose a precise number. Focusing on the one-stop-shop concept, in line with other B2B tech companies, the platform covers listing and booking management software, analytics, accounting tools, multi-property management capabilities, and CRM features. Recent additions include enhanced payment services, capital advances (all developed in-house, not third-party white-labeled solutions), damage protection services (dipping its toes into the insurance space), website building tools, and price optimization services that seamlessly integrate with various platforms where a property manager may list a room or home for travelers to book.
Secondly, although Guesty heavily focuses on short-term rentals (typically under a month), it aims to break ground in the medium-term space. This will attract a diverse market of people temporarily residing in a location for work assignments, among other purposes.
Lastly, Soto revealed that Guesty may consider acquisitions. The current funding climate may not be favorable to all startups, but this does not reflect their capabilities or contributions to the industry. In fact, there are several promising companies that may be open to mergers and acquisitions, albeit at less bullish valuations.
If these efforts remain consistent, Guesty is poised for significant growth. KKR’s Stephen Shanley, Europe Tech Growth partner, along with Lauriane Requena, Tech Growth principal, and Dennis Kavelman, Inovia Capital partner, will join Guesty’s board following the fundraise. Speaking about the investment, Shanley shared, “Guesty is a best-in-class operator and one of the clear leaders in the property management sector. There has been a significant shift towards the short-term rental market, and this investment will support the company as it continues to meet that growing customer need.”
