Hotels have been less popular than vacation rentals in the past year partly because the alternative accommodation sector had adopted more mobile-first technologies. The pandemic supercharged a trend in automation, given that many hotels are now rushing to adopt tools like keyless check-in and related tech that many vacation rentals had adopted years ago.
Hotel interest in automation is good news for tech vendors who have had success in the vacation rental sector. While the selling point of contactless tech is fading as the pandemic wanes, hotel executives are ramping up their interest in using automation to make their smaller staffs more efficient.
A sign of the gold rush in hospitality tech flashed on Wednesday with a merger of two significant vendors in the space. Operto acquired VRScheduler, which automates back-of-house scheduling workflows for housekeeping and maintenance, Skift has learned. The companies didn’t disclose the terms of the deal.
“I’m very excited to continue to lead the growth and product vision for VRScheduler, now as part of the Operto family,” said Jill Mason, CEO of VRScheduler, a brand that will continue to exist in the market.
Both companies got their start by helping vacation rental management companies automate some back-end digital processes. But they’re now expanding their sights to the larger hotel market.
Operto swims in a crowded sea of vendors. Yet the Vancouver-based company is unique in having the backing of Darren Huston, who for four-and-a-half years was CEO of Booking Holdings (then called Priceline Group). Huston is the startup’s executive chairman, and his investment firm BlackPines Capital Partners is a majority investor.
“Darren’s been an incredibly hands-on chairman and owner of Operto,” said Steve Davis, who became the startup’s CEO last October. “The connected ecosystem we’ve been building the past six months is very much his and my vision for how hospitality companies need to respond to the needs of the modern traveler.”
Giant hotel operators such as Marriott International and Hilton Worldwide have long offered mobile apps that let travelers open their guest room doors or order a room service food at properties in the U.S. and abroad. But many independent hotel owners don’t have the resources to invest in comparable systems. Tech from companies like Operto promise to raise the digital game of smaller players to the level of the biggest brands, Davis said.
Huston and Davis believe that tech isn’t the only answer. When things break due to an internet outage or other mishap, a tech vendor must have responsive customer service.
“We took an entire customer service team trained at Booking.com and put them in our company,” Davis said.
The company’s biggest win so far appears to be Mint House, which offers hotel-style stays within luxury residential apartment complexes.
How much has Operto raised? The private company hasn’t said.
“It’s less than Guesty has raised, but it’s significant,” Davis said, referring to Guesty, the maker of software for managers of short-term rentals, that has raised $110 million in funding to date. Guesty’s solutions address different problems from the one Operto tackles.
“Operto exists on the basic premise that the accommodation sector should use more connected technology in their operations to save money, enhance revenues, and, most importantly, delight their guests,” said Huston.
“One could say, we aspire to be the trusted operating system for running a modern accommodation,” Huston said. “To execute against this vision, we have learned to connect to OTAs [online travel agencies], PMSs [property management systems], and a selection of the very best smart devices. We are also building software that connects property managers, their teams, their guests, and the on-premise IoT [internet of things, such as noise monitoring sensors and temperature controls].”
Competitive Segment in Hotel Tech
Operto began five years ago by focusing on helping rentals enable guest access to units via contactless, keyless entry. It worked with locks that use keypads, providing guests with a code to enter. But it soon began to see the locks as a stepping stone to a broader tech play by offering property automation and internet-of-things control systems for the hotel, vacation, and short-term rental segments.
The largest player in North America is probably Intelity, which offers a guest engagement and staff management platform for hotel and other hospitality brands. The Los Angeles-based startup has raised about $63 million to date. But other players keep entering the fray.
In April, travel search brand Kayak launched the ability for guests at an independent hotel in Miami Beach to use a Kayak app to check-in, lock their rooms, and order room service, with plans to extend the service across other properties that are part of the Life House brand. When Skift sent a reporter to stay undercover at the Kayak hotel, they found that the kiosk for check-in had some glitches — underscoring the complexity of contactless tech for guest access in general.
OpenKey is another notable tech initiative. Ashford Hospitality Trust, a U.S.-based owner of hotels in the limited and select-service market segments, has 75 percent interest in the company and helped the vendor sign a master services agreement with an unnamed “major hotel brand” late last year. OpenKey offers a Bluetooth-based smartphone app for keyless entry in guestrooms at more than 200 properties.
Meanwhile, hotel chain CitizenM has invested in iReckonU, a startup that builds cloud-native hospitality software solutions. It promise a modern check-in process, and it can check for air conditioner failures and other operational issues.
Accor in February hired the startup Staymyway to be a provider of mobile key technology, with a plan to cover at least half of the 800,000 rooms in the Accor network worldwide over the next five years. StayMyWay’s technology lets hotel guests gain access to their rooms without stopping at the front desk. Guests take a picture of themselves and their passport or another identification document using their smartphone.
Other players, to varying degrees, include Brivo, Check-in Scan, Everydoor.io, GoKeyless, Hotelbird, Igloo Home, Klevio, MyQ, PointCentral (a subsidiary of Alarm.com), Rabbu, RemoteLock, Rently, RentingLock, VirtualKey, and of course, traditional lock makers, such as Abloy, Kwikset, Yale, and Schlage.
Hotel Tech Merger
Operto began by automating the guest access problem with keyless entry. It’s now a software company that works with all the major brands of lock hardware in North America and Europe, Davis said. The company has been this year been adding connections to third-party devices, such as the noise-monitoring tech of startup NoiseAware and smart home controls for thermostats and so on.
VRScheduler, led by Jill Mason since she founded the company in 2017 in Leavenworth, Washington, strives to replace the need for several pieces of software and manual work at cutting and pasting booking dates to schedule housekeeping staff or service appointments.
“Having worked closely with the Operto team over the last four years, I’ve witnessed what they have built, how they operate as a leading company in the space, and how they have delivered on changing guest expectations in rentals and hotels,” said Mason.
Earlier this year, Operto launched an operating system that aims to let guests access everything on-premise.
“Let’s say a guest is lounging at a pool and wants to know if housekeepers have cleaned their room,” Davis said. “Because we’ve connected all the tech, we can let the guest know that information.”
The management can also use our tech to let the guest know about a special promotion or about a nearby tour and activity that’s bookable, he said. The merged startups, Operto and VRScheduler, are striving for the tall order of using data to build a triangle between the guests, the operations, and the management.
“We’re starting to see consolidation in hospitality tech, where the bigger players are starting to work alongside a smaller group of providers to provide a ‘super offering,'” Davis said.