Bob W's expansion comes at a time when the short-term rental market in Europe is seeing high demand. But it's no easy task to become a profitable pan-European operator with all the regulatory challenges in a fragmented market.
Finnish short-term rental operator Bob W has acquired Munich-based German competitor Charly Hospitality.
The acquisition enables Bob W to expand in Germany — Europe’s largest domestic travel market, where it added seven properties located in Bonn, Munich, Berlin, Lübeck and Cologne, as well as Amsterdam in the Netherlands. All of these properties will move over to the Bob W brand during 2023.
“Germany is at the inevitable center of Europe,” said Niko Karstikko, Bob W’s co-founder and CEO. “Germany has many vibrant cities within, it’s also a travel market where the guest is open to trying different forms of hospitality,” Karstikko said. Bob W’s co-founder Sebastian Emberger is German.
Neither company disclosed the details of the deal, however, Karstikko noted that the company’s last fundraising round of €21 million ($23 million) Series A financed this acquisition. The round was led by Elevator Ventures, Verve Ventures, IDC Ventures and Flashpoint.
Bob W operates buildings under its own brand, and acquires most of its properties through rent-to-rent arrangements or management agreements, allowing it to control the guest experience.
“The short-term rental space is fragmented, and there is no winner-takes-all type thing,” said Karstikko. “We’re adamant that now is the time to grow fast. We’re financially healthy and expanding rapidly both organic and acquisition targets.”
Karstikko said this has given the company confidence to expand by looking for short-term rental operators in continental Europe and the United Kingdom, and eventually geographies beyond Europe. “We are finding a lot of companies to partner up with. Then we will put our brand on top of them, and extract more value,” Karstikko said.
Charly Hospitality founder Jona Schaeffer was also bullish about the deal.
“With Bob W, we have found the perfect home for our team and our portfolio of boutique aparthotels in Germany and the Netherlands,” Schaeffer said. “We strongly believe in Bob W’s potential to become the market leader in alternative accommodations in Europe and are delighted that Charly will play its part in it.”
Charly Hospitality is Bob W’s third acquisition following the acquisition of Estonishing Stay, Estonia’s largest short-term rental operator in May, and Finnish operator Koti in October last year.
Based in Helsinki and Tallinn, Bob W currently operates 27 aparthotel and coliving properties across Europe — in the UK, Spain, Finland, Italy, Norway, Greece and Estonia.
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Photo credit: A one-bedroom suite listed on Bob W in Tallinn. Source: Bob W