The Covid-19 pandemic brought travel and tourism to a standstill, but as those sectors pick up again, the more promising startups in these sectors are also raising money to keep up. Today a startup called Meow — which offers a cloud-based hotel 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 valuation of $865 million.
Co-led by Kinnevik and the Growth Equity division within Goldman Sachs Asset Management, the round also included new lenders Revaia, Derive Ventures and Orbit Capital; as well as previous investors Battery Ventures, Notion Capital, Salesforce Ventures, Thayer Ventures and henQ. The increase is primarily equity with a small amount of debt, founder and president Richard Valtr said in an interview. Columbia Lake Partners provides the debt.
Mews are streets (e.g. in London) full of mostly small houses or flats that have been converted from horse stables into larger houses in the neighbourhood. Ironically, Mews the startup isn’t that small at all. In the year that travel ‘came back’ after the peak of Covid and the various restrictions placed on people moving, Mews saw revenue grow 174%, with gross payment volume up 227% in the period and now at $2 .3 billion. It has customers in 70 countries, a total of 3,253 hotels.
Clients include major chains ranging from five-star hotels to the most basic accommodation, including Accor and the Youth Hostel Association, as well as a number of smaller groups and independent hoteliers, all of whom turn to Mews for specific tools to manage reservations, payments, guest services, analytics, hotel employee shifts, as well as a marketplace of 600 apps for users to build one-stop dashboards that integrate any number of other apps a hotel might use in its operations (e.g. accounting, sales, or CRM software), a kind of like a Toast or a Shopify for the hospitality industry, Valtr said.
Today, that also leads the company to partner with other types of property management groups that want to provide residents or visitors with hotel-like services — the Airbnb effect on how we live today, or would like to live.
“We see ourselves as the platform on which businesses in our industry are run,” he said. “We take a broad approach to our ambitions. Meow nominally deals with hotels and hospitality, but that can be hostels or Airbnbs or services for people in mixed-use real estate. Longer term, we feel that what is considered commercial or residential is merging. This is the direction all real estate is going. What happens after the pandemic is that more people are realizing that they want to live more of their travel life.”
The last time Mews raised money was in 2019, a $33 million round it raised in part to refocus on working on the product and building out its technology to differentiate itself from the other property management software players on the market . It turned out to be a fortuitous shift, Valtr said: When the pandemic hit, the company was head-over-heels for its own internal transformation, just as hotels were also looking to invest in better and newer systems during their own downtime. That may be a sugar-coated spin on a period that was virtually dead for the travel and tourism industry, but ultimately, the growth Mews has experienced recently speaks to its momentum right now.
This latest funding will essentially be used for more of the same: more investment in technology and to expand globally, with some optional M&A.
“Richard, [CEO] Matthijs Walle and the wider Mews team have a strong understanding of the needs of hoteliers and have taken a product-driven approach to develop a modern solution in an industry ripe for disruption,” said Akhil Chainwala, investment director at Kinnevik, in a statement. As cloud adoption in the hospitality industry accelerates, driven by more complex guest needs and rising costs, Mews is best positioned to rebuild the industry’s digital plumbing. We are delighted to welcome a fourth travel investment to our portfolio and look forward to supporting Mews in the next phase of its journey.”
What was surprising is not so much that Mews is seeing a surge in business, but that investors are now easily behind it, given how difficult it has been for other industries, and given the current investment climate and contraction in the hospitality industry in particular.
“Closing a grand round in this environment speaks to the tremendous growth and future potential of Mews,” Kirk Lepke, MD in the Growth Equity business within Goldman Sachs Asset Management, said in a statement. experienced many challenges over the years, increasing the demand for cloud-native platforms, such as Mews, to help them modernize, improve the guest experience and create efficiencies through smart automation.With their open architecture and fully integrated payment capabilities, Mews is heavily relied upon as a mission-critical solution.”
