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The two-year-old New York-based company has developed a “white-label” software platform aimed at increasing revenue and operational efficiencies for boutique hotel operators. Its technology has led to a “30-50 percent higher return on hotel investments for its real estate partners than traditional management companies,” the company said. It has applied that technology to become a boutique hotel operator in addition to help other hotel owners more effectively manage their properties. In a press release, Life House said it plans to use the new capital to acquire “seven to ten additional hotels.”
In May 2018, the company raised $10 million in a venture round (covered at the time by Savannah Dowling) led by Global Founders Capital that included participation from Comcast Ventures and Trinity Ventures. CEO and co-founder Rami Zeidan said the company has been operating in a “capital-efficient manner to maximize returns for (our) venture capital investors.” For example, the company said that during its first year of operation, it signed over 500 rooms across nearly 10 projects, while spending less than $5 million of its raised venture capital. It’s focused on buying and revamping the management of hotels “with fewer than 150 keys.”
Zeidan formerly served as a vice president at TPG Capital where he focused on hotel and hostel investments, according to his Crunchbase profile.
New investor Blue Flag Partner began its relationship with Life House earlier this year after the startup took over the operation of The Roberts Collection, a historic 58-room hotel in Nantucket, MA, acquired by Blue Flag in April. Currently, Life House is operating that collection as part of its platform and will begin restoration of the hotel this fall. Terry Sanford, co-founder of Boston-based Blue Flag, said his firm was so impressed with the fact that Life House was able to so quickly yield “40% higher total revenue with nearly 80% direct web bookings,” that it decided to invest in, and “actively” build its portfolio with, the company.
“We selected Life House after a competitive process, and we’ve quickly seen the massive value they’re able to create,” Sanford said in the press release. “We’ve been very impressed with Rami and the Life House team and we’re actively looking to build our portfolio with them around the country.”
The hospitality space has been picking up steam. Yesterday, we reported that short-term rental provider Sonder had raised $210 million, becoming hospitality’s latest unicorn.
Illustration: Li-Anne Dias
Note: This story was updated post-publication to reflect that the round was in fact not a Series B.