Hostaway, a distinguished player in the vacation rental software and management system arena, has announced a colossal capital raise of $175m.
This monumental investment represents the largest funding round in the sector to date, with the lead investor being PSG, a prominent growth equity firm noted for its partnerships with software and tech-enabled service companies to accelerate their growth.
Hostaway’s ambitious plans for the use of the newly raised capital include powering its growth trajectory, expanding globally, growing its workforce, fortifying customer service, improving onboarding processes and pursuing both organic and inorganic opportunities to enhance market share.
Established in 2015 by Marcus Rader, Saber Kordestanchi and Mikko Nurminen, Hostaway’s mission is to automate and streamline the process of property management, aiding property managers to scale and expand their businesses. With an impressive growth profile, Hostaway’s revenue has surged over tenfold since 2021. The company’s clientele today collectively manage more than 100,000 properties across over 100 countries.
The company boasts of over 100 partners in its marketplace, marking one of the highest numbers in the industry. Hostaway became the first-ever property management and channel management software company to secure the highest partnership designations from leading online travel agencies such as Airbnb, VRBO and Booking.com. It also currently enjoys preferred relationships with Google, Expedia, Tripadvisor and Homes & Villas by Marriott.
Hostaway’s CEO and co-founder Marcus Rader expressed excitement at the partnership with PSG. He said, “We are thrilled to partner with PSG, as we continue to elevate the vacation rental industry and unlock value for property managers beyond what had been thought possible. We have operated with incredible speed and efficiency, balancing growth with our current strong profitability, and this investment represents a significant milestone in our journey toward global market leadership. We’ve come a long way, but we are just getting started. The opportunities are endless!”
Edward Hughes, managing director at PSG, also shared his optimism about the investment. He said, “We are impressed with the quality of the Hostaway team, their vision and execution in building what is, in our view, a highly differentiated category leader with multiple levers of value creation. We believe the company has a significant opportunity to lead this industry, as it continues to scale its integrated platform, expand globally and help its customers meet the growing demand in the short-term rental market. We look forward to partnering with Hostaway in this new exciting chapter.”
In this funding round, Vista Point Advisors, a San Francisco-based boutique investment bank, served as the exclusive financial advisor to Hostaway.
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