In a world of new ideas, next big things and game-changing innovations, it is harder than ever for start-ups to stand out. So when one does, it is worth sitting up and taking notice. Quickly. Because blink and it could be on the other side of a multi-million pound valuation before you can say “exit deal”.
YourWelcome is on the cusp of becoming a case in point. The proptech start-up developed by digital entrepreneurs Henry Bennett and Paul Loram attracted £1m of investment in a single day, is being eyed by Airbnb as a potential platform partner and has been valued at £2m.
The concept is simple; the provision of a rentable, WiFi-enabled tablet for short-term hosts and landlords preloaded with all the software they need to create welcome videos, room-by-room guides to the property, plus local area maps and information. But the real value comes from the added extras.
First, Bennett, 37, and Loram, 38, have introduced a function that gives hosts access to revenue streams beyond the property rental itself. The option to include links to external services including food ordering app Just Eat and minicab firm Addison Lee mean for every click through the YourWelcome tablet, a share of the profit is delivered back to the host.
And to make the most of that service, the company also provides analysis based on user search and purchase activity: “This effectively helps hosts and landlords optimise their listings,” says Bennett.
“If 70% of people staying in your property are searching for tickets to the National Portrait Gallery, you know that’s a link you should be including. If you have recommended an Indian restaurant and you then discover that a large proportion of your guests are searching for Japanese food you can amend your listings to maximise your click rates and returns.”
Now the duo is gearing up for a longer term expansion into the wider property sector. With a trial starting this month across 100 serviced apartments and plans to investigate how the product could work in high-end student accommodation and PRS developments, Bennett and Loram reveal what is next for YourWelcome.
Frustration and inspiration
Like so many of the best ideas, YourWelcome started as a hack. In March last year Bennett, a part-time Airbnb host, was desperate to find a way to communicate with guests that did not require lengthy instruction print-outs and an inevitable flurry of follow-up calls and texts.
“As you can see I live in an old London terraced house,” he says gesturing around the living room of his home in Waterloo, SE1. “And that can be a mixed blessing when you are listed on Airbnb. Lots of overseas visitors – particularly Americans – love the idea of it because it looks quaint and very English. But then they get here and they have no clue how to work the ancient taps or turn on the heating. That was the basis for the idea.”
He joined forces with Loram as the two are long-term business partners. They built the first mobile app for the BBC to integrate the iPlayer and set up and sold their mobile agency, Island Wall Entertainment, to post-production company Deluxe in October 2014.
Their first big break after embarking on YourWelcome came in September last year when they were taken on as part of the second cohort of start-ups at PiLabs, Europe’s first proptech accelerator, based in Shoreditch, E1. Apart from making the most of the mentoring sessions and guidance, they had their sights firmly set on demo day – the culmination of the three-month stint and the opportunity for all the start-ups on the programme to present their business to a room full of potential investors.
“Funding was our primary reason for being in the accelerator,” says Loram. “Just because you don’t get funding on that day, or at least directly afterwards, doesn’t necessarily mean you won’t. But it is a negative on your story.”
When the day came in December, no sooner had the pitches finished than the pair were inundated.
“We had been told by PiLabs that three good meetings off the back of the pitch is a good demo day,” says Bennett. “We had £1m offered on that day. We were seven-and-a-half times oversubscribed.”
“So we basically got to choose,” adds Loram. “We were blown away by the reaction,”
They selected five investors – including a lead who is vice-president of a hotel chain – in the round, which raised £400k off a valuation of £2m. After such a successful start, the pressure is on to deliver. And it is likely to be on a scale the pair had not even considered when the idea was born.
PRS potential
“When we came up with this concept our knowledge of the short, medium and long-term let market was pretty limited,” says Bennett. “We knew about short-short lets – the likes of Airbnb – because we are both hosts and we use the service.”
But following the PiLabs demo day, the full potential and possible reach of the concept became clear. “We didn’t mention PRS or student accommodation in our initial pitch. But then we had a glut of investors coming to us and saying ‘we want to invest’ and their take was very much that there is a massive market that could underpin our business. Companies that could give us 50,000 units in one order.”
Given the extent of work and development still required to introduce YourWelcome on a grand scale to the holiday lets market – it has been trialled in a beta phase in 100 Airbnb properties – expanding into the wider property industry is part of a future plan. But Bennett and Loram are already looking into opportunities with student accommodation providers and have done a deal with serviced apartment provider Skyline to trial the product in 100 properties, starting this month.
“We just need to find out how it would work in longer-term lets,” says Loram.
“The tablet itself is rented in the same way people sign up to LoveFilm,” adds Bennett. “We send it out and you rent it for £9.99 a month. Once you are done you send it back. So it could be that longer-term landlords rent one for the first few months. These are all scenarios we will know more about once we have done some initial trials.”
Immediate task
As the first round of funding closes, the pair are focussed on raising the profile of the service among Airbnb hosts.
The company is running out of Second Home, the shared work space in Shoreditch where PiLabs is also based – “we will stay there as long as we can,” says Bennett – and are waiting until they have the user stats they need to go back to Airbnb to present their business once it is under way.
“Airbnb announced last year that they would start taking on platform partners,” says Bennett. “And you can register to be one of those partners from countries all around the world. We contacted them initially back in September last year and said we are a very early start-up in PiLabs, this is what we have. They said: ‘We like that. Come back and present when you are up and running’. So it is up to us now to do that once we are live and have the user stats.”
So far those stats are looking good. Of the 100 tablets being used there is an average of an hour of usage and five clicks on suggested links per stay.
“There is something about coming into a property and having a WiFi-enabled tablet and all the stuff that goes with it which is capturing people’s attention,” says Bennett. “There is unquestionably a good user case.”
The future is looking bright, but there is one big question that Bennett and Loram are asked on a regular basis. Is the tablet even necessary when everyone has their own mobile device?
“People have asked why we haven’t just developed this as an app,” says Bennett. “But I know that if people arrived here at my house and I said: ‘If you want any more information could you connect to the WiFi, put in this password and download this app and 20MB worth of data’ they just won’t do it. It won’t happen. Our USP is that if there is a tablet next to the flowers and wine, the guests will definitely look.”
“Maybe not as soon as they arrive,” adds Loram. “But they will. Our research is showing unequivocally that they will.”
In a world of new ideas, next big things and game-changing innovations it is harder than ever for start-ups to stand out. So when one does, it is worth sitting up and taking notice.
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