Edinburgh-based TravelNest, an advertising optimisation platform for holiday rental owners, has raised £3m in Seed funding.
Early-stage venture firms Pentech, Mangrove Capital Partners and Frontline Ventures participated in the round.
Mark Logan, former COO of Skyscanner, also invested and will be joining the firm’s board.
TravelNest will use the cash to grow its engineering team and continue to develop its product.
Recent research has shown that the vacation rental market has ballooned over the past decade and is expected to be worth $193bn by 2021, with large B2C players such as Booking.com and Airbnb driving the market for alternative lodging.
As it stands, though, the market is very fragmented, with many property hosts having to advertise on more than 40 different booking sites.
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“This is a real headache for holiday rental hosts. Every property is unique and there’s hundreds of advertising and listing options, all of which offer something different. It’s very difficult to gauge what advertising equates to in terms of performance for each site and the task of boosting site rankings is very complex,” said Doug Stephenson, founder and CEO of TravelNest.
“This is a massive market but while the B2C side of the sector is well developed, the B2B side has so far been almost entirely overlooked.”
To solve this issue, TravelNest has created a central platform, which collects data from each site and optimises the information to help users increase their revenue per rental.
TravelNest does not charge a subscription fee, but will instead monetise by the commissions it makes from advertising booked on its platform.
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The firm launched in January this year and now employs 20 people, including Alistair Hann, the CTO (ex-Skyscanner) and Jeff Pole, previously director of product at Onfido.
“We see a very large opportunity to create value by intelligently matching supply and demand,” continued Stephenson. “With this experienced group of investors we have support for the long run but our focus right now is on product development.”
Craig Anderson, partner at Pentech, said: “Doug has spotted an enormous opportunity to help holiday property owners maximise income and is assembling a first class team with very strong conviction.”
Hans-Jürgen Schmitz, co-founder and managing partner of Mangrove Capital Partners, added: “The TravelNest team is exceptionally gifted. They have built this business out of their garage, with the conviction that the fragmented supply in vacation rentals offers significant potential for growth through intelligence and automation.
“We are excited to part of this challenge as Doug and his team help property managers capitalise on the massive benefits of new technologies and the Internet.”
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