Japanese vacation rental startup H2O raises $7m from Samsung, others
Japanese vacation rental management company H2O has raised US$7 million in a series B funding round from Samsung Ventures, Stonebridge Ventures, IMM Investment, and Shinhan Capital. This brings the startup’s total funding to about US$18 million, according to a statement.
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The company said it will use the new funds to support its working capital needs.
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Photo credit: Pixabay
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According to Crunchbase, the startup previously secured investments from 500 Startups in a US$1.5 million seed round in 2016, followed by a US$10 million round with Samsung Ventures in 2018.
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The company started in 2015 with a service called Wahome in South Korea. Then, it acquired online and offline accommodation companies in 2017 to advance into the Japanese market.
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H2O manages accommodation facilities without on-site human resources by automating all operational flows through the property management system (PMS) it developed. The PMS links and manages calendars between guests, rooms, and housekeepers, helping to reduce operational expenses.
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To date, H2O manages 5,000 rooms and sells through 25 different global and local online travel agencies. The company said its average daily rate was US$160 in 2019, with an average occupancy rate of 87%. It also claims that its revenue has doubled every quarter since Q3 2018.
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“We found that the way hotels have been managing the real estate hasn’t changed over centuries and figured it was very inefficient,” said John Lee, CEO and founder at H2O. “I named our company H2O, which is a shortened version of hospitality 2.0, to show people that we are aiming to develop the second generation of operational method for hospitality facilities that can be and should be managed without on-site human resources.”
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In June 2018, Japan implemented the Housing and Accommodation Business Act to legalize vacation rental management. The move led many mansion owners to convert their properties into vacation rental facilities.