The Covid-19 pandemic has brought travel and tourism to a halt, but as these sectors pick up steam again, the more promising startups within them are also raising money to keep up. Today, a startup called Mews — which offers a cloud-based hotel property management platform with tools for reservations, payments and more — announced it has raised $185 million in a Series C funding round, giving the company a post-money rating von receives $865 million.
Co-led by Kinnevik and Goldman Sachs Asset Management’s growth equity business, the round also included new backers Revaia, Derive Ventures and Orbit Capital; and previous investors Battery Ventures, Notion Capital, Salesforce Ventures, Thayer Ventures and henQ. The raise consists primarily of equity with a small amount of debt, founder and president Richard Valtr said in an interview. Columbia Lake Partners is providing the debt.
Mews are streets (e.g. in London) full of typically small houses or apartments converted from horse stables into larger nearby houses. Ironically, the startup Mews isn’t all that small. In the year that travel ‘came back’ after the peak of Covid and the various restrictions placed on people, Mews saw sales rise 174%, with gross payment volume up 227% over the period, now up to 2nd place .3 billion US dollars. It has customers in 70 countries, a total of 3,253 hotels.
Its clients include large chains ranging from five-star accommodation to the most basic accommodation, including Accor and the Youth Hostel Association, as well as a range of smaller groups and independent hoteliers, all of whom turn to Mews for specific tools to manage Getting reservations, payments, guest services, analytics, shifts for hotel workers, as well as a marketplace of 600 apps that allow users to create centralized dashboards that integrate any number of other apps that a hotel might use in its operations (e.g. accounting , sales or CRM software), a bit like a toast or Shopify for hospitality, Valtr said.
This also leads the company these days to work with other types of property management groups that want to offer residents or visitors hotel-like services – the Airbnb effect on how we live or want to live today.
“We see ourselves as the platform on which companies in our industry are run,” he said. “We are pursuing a broad approach with our ambitions. Mews nominally caters to hotels and hospitality, but that could be hostels or Airbnbs or services for people in mixed-use properties. In the longer term, we feel that what qualifies as commercial or residential is merging. All real estate goes in this direction. What’s happening post-pandemic is that more and more are realizing they want to make more of their travel life.”
The last time Mews raised money was in 2019, a $33 million round it partly raised to refocus on working on products and expanding its technology to differentiate itself from the other vendors of property management software on the market. According to Valtr, it turned out to be an accidental shift: when the pandemic hit, the company was engaged in its own internal transformation, which was just unfolding as hotels looked to invest in better and newer systems even during their own downtime. That might be a nice twist in a time that’s been virtually dead for the travel and tourism industry, but ultimately, the growth Mews has had of late speaks to its momentum at the moment.
This latest funding is essentially being used for more of the same: more technology investments and global expansion, also with some optional mergers and acquisitions.
“Richard, [CEO] Matthijs Walle and the broader Mews team have a deep understanding of hoteliers’ needs and have taken a product-centric approach to develop a modern solution in a sector ripe for disruption,” said Akhil Chainwala, Investment Director at Kinnevik, in a statement. As hospitality cloud adoption accelerates due to more complex guest requirements and rising costs, Mews is well positioned to rebuild the sector’s digital infrastructure. We are delighted to welcome a fourth travel investment to our portfolio and look forward to supporting Mews in the next phase of his journey.”
What’s surprising is not so much that Mews is seeing a surge in business, but that investors are ready to support it right now, given how tough it’s been for other sectors and given the current investment climate and contraction in hospitality specifically.
“Closing a major round in this environment speaks to Mews’ tremendous growth and future potential,” said Kirk Lepke, MD in growth equity at Goldman Sachs Asset Management, in a statement. “Hoteliers have experienced many challenges over the past few years, driving the increasing demand for cloud-native platforms like Mews to help them modernize, enhance guest experiences and increase efficiencies through intelligent automation. With its open architecture and fully integrated payment capabilities, Mews is very popular as a mission-critical solution.”