Sonder, Selina Aim To Upset Airbnb

selina
Courtesy of Selina
Selina Location In Puerto Viejo, Costa Rica

In little more than a decade, Airbnb has become an established part of the hospitality industry. Established enough, in fact, to acquire the HotelTonight app in a deal that valued the app at about $465M.

Now investors are eager to support a new wave of upstarts to take on Airbnb and the rest of the hospitality business with variations on the short-term, tech-enabled rental model.

One contender is Sonder Corp., which operates a rental marketplace for travelers. The company has nearly completed an investment round that will value it at about $1B, the Wall Street Journal reports, citing people familiar with the matter.

Greylock Partners (a backer of Airbnb), Spark Capital and Structure Capital are among the existing investors expected to participate in the round.

San Francisco-based Sonder's business model is to offer a platform for short-term rentals like Airbnb, but without the inconsistent offerings that sometimes comes with its approach.

Rather, Sonder leases entire apartment buildings or floors and then adds amenities like a concierge and gyms and oversees the units for consistency, Inc. reports. Each of its rentals has a living room and kitchen, and the company says its offerings are 20% less expensive on average than nearby hotel rooms.

Another new entry into nonconventional hospitality is Tel Aviv-based Selina. The company recently raised $100M in a Series C round led by Access Industries, with Grupo Wiese and existing investor Colony Latam Partners participating.

Selina offers private and shared "Instagrammable" accommodations with coworking facilities, cafés and local experiences, Skift reports. It has 46 properties thus far in Latin America and Portugal.

The company is expanding into the U.S., first opening a location in Miami last year, and it is planning a 126-bed property in the Chelsea neighborhood of New York City. That property will be a hotel that also features hostel-like lodging, coworking spaces, retail and an art gallery.

The new competition for Airbnb comes at a time when that company is expanding into more conventional hospitality territory. In 2018, Airbnb more than doubled the number of rooms available at its site in boutique hotels, bed-and-breakfasts, and other hostels and resorts.

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