Vacation rental income management startup PriceLabs said last week that there is raised $30 million in a “minority growth investment” round.
Summit Partners was the only investor in the round. Price Labs, which is already profitable, said this round is the first time it is seeking external funding and that the money will be used to expand its revenue management platform and expand its teams.
Chicago-based PriceLabs was founded in 2014 when co-founder Richie Handelwal found it difficult to price his own home on Airbnb and realized that vacation rental owners were essentially left to fend for themselves. As a result, he created a pricing algorithm to solve his problem with friends and co-founders Anurag Verma and Sana Hassan. Algorithm has since evolved into a startup and incorporated other AI-based analytics tools that help managers and small business owners manage short-term rentals.
“With the support and growth-oriented resources provided by Summit, we are excited to continue our mission to innovate the short-term rental market and accelerate our global hiring,” Verma said in a statement.
Khandelwal explained that pricing can be the biggest lever for growth in running a business. “Especially in the hospitality industry, where most businesses still use archaic methods and static pricing that can reduce 10% to 40% of revenue,” he added.
The PriceLabs algorithm relies on local data to sense changes in demand for short-term rentals based on each market’s conditions. Therefore, owners and managers of short-term rental properties can dynamically adjust their prices based on these conditions in order to maximize profits. PriceLabs says its prices are updated automatically through integration with more than 70 property management platforms.
Hassan said the company’s platform democratizes powerful tools that have historically only been available to the largest companies in the hospitality industry. “From an individual landlord renting out their apartment in Paris seasonally to a multi-thousand-unit rental manager in Florida, we’ve created a solution that’s easy to use, affordable, and integrates perfectly with the software they’ve already adopted,” he said. .
Summit Partners CEO Colin Mistell, who serves on PriceLabs’ board of directors, said he believes the company is uniquely positioned to serve the growing market with an intuitive, customizable and comprehensive solution designed to deliver a return on investment for owners and managers.
In 2021, PriceLabs notably won the SaaSBoomi Startup of the Year Award in 2021, and now does business in over 100 countries, managing around 150,000 listings worldwide.
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