Is It Crisis Time for HotelTonight or All Systems Go?
Skift Take
As competitors close in and some do heavy TV advertising, HotelTonight states that it is doing "hundreds of millions of dollars" annually in gross bookings and that it has grown 100 percent per year over the last two years. This will continue to be an interesting skirmish between a well-funded startup focusing on last-minute versus larger players that can offer more wide-ranging solutions for hotels.
Has HotelTonight missed its moment?
Some, but not all, of HotelTonight's competitors and travel industry prognosticators make that argument.
As HotelTonight approaches its fifth birthday in December, skeptics see its brightest days as being behind it as big competitors have caught up. After disclosing more than $81 million in venture funding through early 2014 and attracting a post-money valuation of perhaps $320 million or so, HotelTonight can't possibly grow fast enough in the face of such competition to bring substantial returns to investors and make a successful exit, critics charge.
But the jury is out and likely won't issue a verdict on the exit strategy issue for several years, and some admittedly bare bones performance statistics from HotelTonight tell a different story.
HotelTonight burst on the scene in late 2010 as a same-day hotel-booking service built from the ground up as a mobile-only app, and it was indeed the fastest hotel-booking app on the planet. It was a fairly radical approach to go mobile-only at the time and HotelTonight's curated roster of hotel partners included just 50 properties in three U.S. cities at the time.
Fast-forward and HotelTonight has expanded beyond same-day bookings to include reservations a week out. Some view this as a sign of weakness, an indication that the same-day or last-minute market amounts to just a feature and is too small to support a full-fledged business. Meanwhile, HotelTonight, which has around 200 employees, now offers rooms in 36 countries and more than 1,900 cities in North America, Latin America and Europe, and the company states it has worked with more than 15,000 hotels since its founding.
Skift spent the last few weeks engaging with 15 to 20 hoteliers, investors, HotelTonight competitors, and online travel experts to get a feel for private-company HotelTonight's current status and where it's headed.
While HotelTonight has its share of doubters among some competitors and big hotel chains, it gets fairly good reviews from many of the independent hoteliers we interviewed who have offered their rooms through the app.
Importantly, HotelTonight co-founder and CEO Sam Shank cites figures to show the company, which indeed has built a brand among tech-savvy travelers and other consumers, is getting some traction and growing.
Shank says HotelTonight notches gross bookings "in the hundreds of millions of dollars" annually and increased its gross bookings, room nights and reven
