WhyHotel raises $20m in Series B funding round
US: Alternative accommodations provider WhyHotel, which specialises in both luxury short-term accommodations and now extended stay offerings, has raised $20 million in a Series B funding round led by Harbert Growth Partners.
The Washington D.C.-based startup primarily operates pop-up hotels in newly built “luxury” apartment buildings that can be rented out. The round also saw participation from Highland Capital Partners, Camber Creek, Working Lab Capital, Geolo Capital, Revolution’s Rise of the Rest Seed Fund, and former Bain Capital Partners MD Mark Nunnelly, according to VentureBeat.
As a result, WhyHotel has now raised a total of $35 million since its launch in 2017.
The company currently partners with property owners and real estate companies to convert apartment blocks that are not under lease into temporary short-term rental apartment-like hotels.
Currently offering properties in locations such as Seattle, Houston, and Arlington and Tysons Corner in Virginia, WhyHotel plans to divert the latest funding towards expanding into further domestic markets to grow its brand presence.
WhyHotel CEO and co-founder, Jason Fudin, said: “How people use space is evolving at a much faster pace than the three to five years it takes to deliver a high-rise building. To address this, we are accelerating innovative real estate offerings for consumers and developers alike.”
Now, the company is moving more towards extended stays to appeal greater to business travellers, but its joint offering of shorter and mid to longer-term rentals may eventually prompt property owners to use their apartments as vacation rentals if they prove to be highly profitable.
Fudin added: “Unlike major operators that have been hobbled by delivering products that mismatch long-term lease obligation and short-term consumer contracts, our products are designed with an understanding of real estate cycles in mind and the goal of building a sustainable, profitable business.”
WhyHotel is harnessing the growing demand for alternative hybrid accommodation that combines the home comforts of an Airbnb with high-quality amenities that one would expect in a hotel, such as smart concierges or a gym etc.
The likes of Domio, Sonder and Lyric are competitors in the space who seek to offer similar services and have notably raised large amounts of capital in the last 14 months or so.
In the future, WhyHotel added that it aims to offer “additional products and services” to guests for the duration of their stay.
For more information, visit the WhyHotel website here.
