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Roomer secures $2 million in funding for hotel reservations marketplace

@denschaal

Mar 05, 2013 9:00 am

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We’d love to be wrong, but Roomer will face stiff challenges scaling this business and convincing buyers that they have nothing to fear in purchasing hotel reservations from other travelers.

— Dennis Schaal

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Roomer

Roomer is creating a marketplace for travelers to sell nonrefundable hotel reservations to other travelers looking for discounts. Roomer


Israel-based startup Roomer raised $2 million in seed funding from BRM Group in a bid to create a marketplace for travelers to sell their room reservations to avoid cancellation fees.

Introduced in beta last month for hotels in San Francisco, Las Vegas, and New York, Roomer says it wants to enable travelers who already have nonrefundable reservations to sell them, and for buyers to pick up discounted rooms as part of the process.

Roomer says it handles “the painstaking procedures with your hotel or travel agent” to cancel or alter the original reservation.

How does that happen?

“The seller will pay some of the cancellation fee or all of it,” says a Roomer spokesperson. “It depends on the price he’s asking. Let’s say he has 3 nights for $200 a night. The fee is one night. He can sell it for $400$ to $600. If there’s demand, he’ll recover all of the fee. If not, he’ll recover some of it.”

And, how does it work for the person buying the reservation if the original reservation is nonrefundable?

The spokesperson says sometimes Roomer can do a name-change on the reservation and at other times it will add a name to the previous reservation. The buyer will get a confirmation email from the online travel agency or hotel, the spokesperson says.

“The best thing is that we give the buyer assurance,” the spokesperson says. “If something went wrong, we’ll cover everything” or handle it if there is a problem at the hotel.

Gon Ben David, founder and CEO, believes there is an untapped marketplace for this type of business.

“We have created Roomer to help every person that is about to pay a cancellation fee,” Ben David says. “Today there are many reservations which are fully non-refundable, and cannot be cancelled even months in advance. In addition to that, there are many people that have last-minute change of plans and are about to lose their money, and Roomer will help them to win it back.”

In addition to representatives from BRM Group and other directors, Roomer’s board also includes Uri Levine, co-founder and president of Waze.

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