Austin, Texas-based The Guild, a short-term, apartment-style accommodations provider primarily focused on the business travel market, has raised $25 million in Series B funding, it announced Monday. Venture firms Maveron, Convivialite Ventures and ATX Venture Partners participated in the round, as did RXR Realty, Corigin Ventures and Nicol Investment Group.
The company partners with real estate developers to convert entire floors in Class A apartment and office buildings into hotel suites that offer guests a "customized and personalized experience." This includes having someone to greet guests upon arrival, having their refrigerator and bar stocked ahead of time, and for those with recurring weekly stays, laundry and dry cleaning service between stays. There's also a 24/7 support team available via an app or through text messaging.
"We typically work in buildings with at least 250 units or more total apartments, and work with the owner to take 15 to 25 percent of those and operate them," Guild co-CEO and co-founder Brian Carrico told BTN.
This model is also being used by such competitors as Airbnb for Work, Domio, Lyric and Sonder, to name a few. In fact, Guild units can be found on Airbnb for Work, Carrico said. What makes Guild different, he added, is its focus on delivering a consistent hospitality experience and keeping unit growth contained to about 100 percent year over year.
"A competitor might want to open 25 markets in a given year," Carrico said, "but it's hard to hire general managers and build the service organization that really delivers that high-quality guest experience on a human-to-human level when you are taking that wide of an approach. That's hard to do when you're growing at 300 to 400 percent per year."
A majority of Guild's bookings come from a cross-section of business travelers, including some staying months at a time and others returning weekly for project work, as well as corporate group travel. The company said it works with more than 100 corporations, including Amazon, Deloitte, Google and McKinsey, and negotiates daily corporate rates that average between $150 to $250, depending on the market.
The Guild is available for booking on global distribution systems, and business travelers can book via a corporate travel app or agency platform. "Whether Concur, Egencia, CWT, Amex Travel, we work with all the major platforms," Carrico said.
Carrico has been in the hospitality business for about 10 years, developing boutique hotel properties. His co-founder, Chris Herndon, has a background in technology. "We have a very strong belief that hospitality is personal and that technology can make that experience better," Carrico said. "But technology doesn't completely replace humans when delivering that experience."
The Guild currently operates about 800 units in Austin, Cincinnati, Dallas, Denver, Miami and Nashville, and plans to use the Series B funds to expand to six more cities through 2021. Locations being considered include Boston, Chicago, New York, Seattle, and Washington, D.C. It also plans to expand its presence in Denver, Miami and Nashville. Business travel demand will determine where and when the new markets will open. Its first office conversion will open this year, in Dallas in the "top two stories of a 50-story tower that already has a social club, co-working space and 40-odd floors of potential business travel clients for us, so it's a great fit," Carrico said, adding that any New York units ultimately will be office conversions.
Last April RXR Realty also invested in Airbnb, to convert 10 floors in Rockefeller Center to hotel suites. "That is a perfect example. … We view a lot of what is happening as a validation of this new [hospitality] category," Carrico said. "There is not one company that will take on all this new supply that is created. In these businesses where you have to control physical space and deliver an experience, there's a limit to how much you can take on and operate responsibly. RXR understands this is an execution business. They agree with us that increasingly partnerships between landlord and operators like us will be very tight and [with] even revenue sharing between owners and operators. We will be judged based on quality and consistency, not based on sheer dollars raised or size."
The Guild, founded in 2016, has raised $33.5 million in total funding, following $8.5 million raised in its Series A round, led by Maveron in late 2018.