German travel startup makes profit despite the epidemic



A German travel startup is still making a profit despite the world tourism industry surrounded by the COVID-19 epidemic.

 Many European travel technology companies have faced many difficult obstacles in the context of the outbreak of COVID-19 that forced governments to limit the movement of people.

 However, in the midst of that time, a German travel startup was still making a profit despite being affected by the pandemic.

Travel startup makes profit despite the epidemic

Limehome applies an airline-style revenue management system / ph: Limehome

 Limehome is considered a pioneer in providing “contactless” accommodation alternatives to traditional hotel options, with a combination of designer apartments and a platform AirBnB-style booking management - one of the largest accommodation companies in the world.

 However, unlike AirBnB, Munich-based Limehome works directly with the owners of the facilities to design and interiors the apartments according to the company's own standards.

 Common projects of Limehome are to transform abandoned offices in towns into "boutique" resorts - small, special, friendly and modern.

 Limehome manages reservations, check-in and check-out, room cleaning, service and invoicing entirely with technology.  Bookings with Limehome are mostly through online booking sites like Booking.com or Expedia, but so far the number of direct bookings on the company's website has increased by 30%.

 In particular, Limehome applies an airline-style revenue management system that allows the company to adjust room rates with last minute offers to attract customers, so the room availability rate is often very low and helps the company maintain get the minimum profit even with price reduction.

 As countries imposed a blockade in the spring, the number of bookings with Limehome also decreased for a short period of time.  But from May to September, the company has restored 85% of capacity at 45 facilities and 35 other facilities are in the completion stage.

 Limehome's business model has shown the ability to adapt to circumstances, especially during times of crisis.

 Even during the peak of the COVID-19 pandemic, the tourist market plunged by nearly 90%, Limehome's properties were still operating well and bookings were almost maxed out.

 As governments must apply again travel restrictions and require hotels to close to curb the second wave of epidemics in Europe, Limehome still expects its facilities to continuously take reservations from business travelers.

 Limehome co-founder Josef Vollmayr said the company was lucky during the first blockade as customers gradually turned to Limehome's services amid many hotel closings.

 Lars Stäbe, co-founder and chief executive officer of Limehome emphasized that the hotel industry has largely neglected the use of digital technology in the business process.

More and more customers are looking for alternatives to traditional hotel booking methods.  Innovative and technology-based models like Limehome benefit from that.

 Despite the ongoing crisis, Limehome is still promoting plans to expand its overseas business and the company will move deep into the Spanish market in the near future.  The first apartments will soon open for operations in Granada, Barcelona and Seville.

 Ricardo Fernandez, Managing Director of Limehome in Spain said that in Germany and Austria, Limehome welcomes more than 5,000 customers a month.  Now, we will bring Limehome's successful business model to the Spanish market.  Although Spain will certainly suffer from the pandemic even longer than Germany, now would be the ideal time for Limehome to expand in this market.  

 Although only a two-year startup, Limehome has recently become a bright star in the fundraising group of the high-end group conducted by the HV Capital Venture Capital Fund when receiving 31 million euros (36 million USD) from investors.

 Meanwhile, many technology firms that have been active in the tourism sector for a long time, such as Getyourguide, have had to cut staffs and change the form of capital call for investment to maintain operations.

German travel startup makes profit despite the epidemic

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