Hotel chain acquires British Airbnb rival for £118m

Ibis owner AccorHotels has snapped up Onefinestay as the industry comes under pressure from new rivals.

by Jack Torrance
Last Updated: 05 Apr 2016

Travel tech is all the rage at the moment. Today Hostelworld, the Irish-based, London-listed travel booking site for backpackers, said total bookings through its core brand were up 15% last year after it revamped its website.

And there’s similarly good news for the British Airbnb rival Onefinestay, whose founders should be set for a hefty payout after the business was acquired by French hotel group AccorHotels for €148m (£118m).

Like its Silicon Valley counterpart, Onefinestay lets home owners rent out their property to travellers looking for a more interesting experience than a generic hotel room. But it’s particularly focused on the higher end of the market and offers a full cleaning, maintenance and insurance service to hosts. Accor has agreed to invest a further €64m to help the company scale.

Read more: Airbnb - the upstart that's here to stay

‘Onefinestay has successfully captured a sweet spot: a combination of needs that neither traditional hotels nor new actors of the sharing economy can meet,’ said Sébastien Bazin, CEO and chairman of Accor, which owns the Ibis, Novotel and Sofitel hotel brands. ‘Today, together with our recent investments, we are accelerating the transformation of our business model to capture the value creation linked to the rise of private rentals and also strengthening our presence in the luxury market with a complementary offer.’

In less flowery language, Accor is trying to avoid being disrupted by the likes of Airbnb by copying the things that have made it a success. It’s not the only old-school hotel chain that’s following that strategy. Hyatt was a previous investor in Onefinestay and last year the FT reported that Wyndham, whose brands include Travelodge and Days Inn, had invested in another British start-up, LoveHomeSwap. Of course one thing you wouldn't catch the founders of Airbnb doing is selling to a trade buyer for up less than 10 figures - an unfortunately common trait among British entrepreneurs, though one that is understandable.  

The rush to acquire new rivals is interesting given the traditional hotel industry isn’t exactly in dire straits. In Europe, hotel occupancy rates were up from 68.6% in 2014 to 70.1% last year, according to Statista. In the Americas they were up from 64.3% to 65.3%, and have been growing every year since 2009.

Despite a few terror-inspired jitters, consumers still seem to be in thrall to the travel bug. But having seen how quickly new competitors have disrupted the taxi, retail and media industries, hoteliers are clearly keen to stay one step ahead of the game.

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