Room to Grow

By fo­cus­ing on business- to- business cus­tomers, Teo Jia En’s and Fed­erico Fol­cio’s on­line ac­com­mo­da­tion- rental mar­ket­place Roomorama is carv­ing out a niche f or it­self

Prestige (Singapore) - - FE AT U R E -

Think short-term va­ca­tion rental web­sites and the first name that comes to mind might be Airbnb, but Sin­ga­pore-based Roomorama is fast gain­ing a foothold in the com­pet­i­tive mar­ket by ex­pand­ing be­yond the business-to­con­sumer (B2C) model. On top of of­fer­ing prop­er­ties di­rectly to users, the start-up has been build­ing up its business-to-business (B2B) traf­fic in the last two years, sup­ply­ing va­ca­tion ren­tals and non-ho­tel ac­com­mo­da­tion to large travel brands such as China’s Ctrip and Tu­jia, says Teo Jia En, 33, who co-founded Roomorama with her Ital­ian hus­band Fed­erico Fol­cia, 38.

Crack­ing open the mas­sive Chi­nese mar­ket “po­ten­tially could be huge,” Teo ex­plains. “There were 120 mil­lion out­bound tourists and trav­ellers (in 2015) and we are po­si­tion­ing our­selves to cap­ture that. A lot of Chi­nese tourists who have al­ready trav­elled out of the coun­try for the first time might choose an apart­ment or villa, rather than a ho­tel [on their sub­se­quent trips].”

Roomorama sets it­self apart from its top com­peti­tors by of­fer­ing pri­vately man­aged mid-range and high-end prop­er­ties, and the bulk of list­ings are for full apart­ments, in­stead of a room in a flat. “If you want a pri­vate space to your­self, rather than shar­ing, then we are the plat­form for that,” Teo says. The com­pany has re­cently launched its B2B plat­form, Bridge, to grow this seg­ment of its business, which is wise con­sid­er­ing that B2B cus­tomers now ac­count for 30 to 40 per­cent of the start-up’s rev­enue.

Teo and Fol­cia hit upon their idea for Roomorama when she was in her early 20s and work­ing at Bloomberg in New York City. The cou­ple trav­elled fre­quently, but they grew weary of drab bud­get ho­tels and back­packer hos­tels, while bou­tique ho­tels were be­yond their reach. “We used to put our apart­ment in New York on Craigslist, the on­line clas­si­fied site; there were no ded­i­cated web­sites to rent on a short-term ba­sis,” ex­plains Teo, a mother of two daugh­ters, six-months and three-years. “And we re­alised there was a mar­ket for this, where peo­ple want to stay in al­ter­na­tive types of ac­com­mo­da­tion. But the process is al­ways cum­ber­some — you have to ex­change keys, you just don’t know who you are deal­ing with on the other side, so we de­cided to cre­ate a plat­form to re­ally make it sim­ple.”

But shak­ing off the com­par­i­son with Airbnb is dif­fi­cult, es­pe­cially when Roomorama was still in development when the now-us$25 bil­lion start-up was launched. “At first, [we thought]: ‘Crap!’ But then we thought the mar­ket would be big enough for more than one player, be­cause we looked at how low-cost car­ri­ers were pro­lif­er­at­ing and the next step is peo­ple trav­el­ling more of­ten and look­ing for cheaper ac­com­mo­da­tion,” Teo says. “You have ho­tels, bou­tique ho­tels, hos­tels, what’s next? We saw the op­por­tu­nity as ev­ery­one’s home.”

Af­ter rais­ing seed cap­i­tal from friends and fam­ily and mak­ing a small profit through an ac­qui­si­tion, Roomorama re­ceived fund­ing from VC firm Vick­ers Ven­ture Part­ners in Septem­ber 2012. Ter­rence Sim, its vice pres­i­dent, said: “The fact that Roomorama started out al­most the same time as Airbnb showed that they were vi­sion­ar­ies and the idea of an in­stantly book­able in­ven­tory in the short-term va­ca­tion rental space was what caught our eye. We be­lieve that if the ini­tial model couldn’t work out well, they have the abil­ity to pivot and this has been proven.”

Teo does ex­press some re­gret about fall­ing a step be­hind the in­dus­try leader. “One of the fail­ures we saw was that we were not ag­gres­sive enough,” she says. “We didn’t ex­pect short-term ren­tals and non-ho­tel rental ac­com­mo­da­tion would blow up the way that it has.”

De­clin­ing to give fig­ures on the start-up’s prof­its or fund­ing, Teo says any plans for IPO are up in the air. “The mar­ket keeps chang­ing,” she says. “Our vi­sion is to be the lead­ing B2B sup­plier of this kind of in­ven­tory around the world. And once we are, I don’t think there will be a short­age of op­tions.”

“We re­alised there was a mar­ket for this, where peo­ple want to stay in al­ter­na­tive types of ac­com­mo­da­tion. But the process is al­ways cum­ber­some”

— Teo Jia En

Newspapers in English

Newspapers from Singapore

© PressReader. All rights reserved.