Notes from the arena: Powering through the fog of the pandemic
I remember March 11th vividly. It was the day the NBA suspended its season. Our occupancy was in freefall, we had a debt term sheet pulled at the last minute, and we were considering furloughing part of our team. I was scared.
The livelihoods of dozens of team members, the financial security of our property partners, and the availability of our accommodations offering to hundreds of thousands of guests were at stake. Could this be the end of the Kasa dream?
What ensued was the most intense 60 days of my life. Our team worked tirelessly to adjust our contracts with property partners, pivot our marketing efforts to attract more flexible stays, and adapt our operations to new and ever-changing COVID-19 protocols. As the days wore on, we started to see our disciplined approach to growth, enterprise relationships with our property partners, geographic diversity, and early technology investments start paying dividends. Little-by-little, we began to see the light. And then, all-of-the-sudden, we didn’t just emerge, we roared back.
While the short-term rental industry has contracted by 40%, we’ve grown units under management by 50%, increased revenue by 100% year-over-year, and transformed our business to one entirely based on asset-light management agreements. We have outperformed hotel RevPAR by 100%, maintained occupancy at 75–85%, and opened five new cities in the process. This has led us to grow our team by 60%, creating jobs during a time when unemployment rates were skyrocketing, especially in the hospitality industry.
Now, five months later, I am thrilled to announce that Kasa raised a $30 million Series B from top investors including Ribbit Capital, FirstMark Capital, RETV, Zigg Capital, BoxGroup, Founder Collective and Allegion Ventures. The last few months could have spelled the end of our journey. But our unique strategy, adherence to our values, a bit of luck, along with the resilience, grit, and determination of our team, has made us thrive.
The fundraise helps us advance our mission of building a global accommodations brand that is beloved by guests, indispensable to property partners, and desired by neighbors with greater speed and scale than ever before. This capital raise also demonstrates to our guests, property partners, and team members that we are not only still open for business, but have gained momentum and have the financial resources to help make step-change progress towards our mission and vision.
We believe this is just the beginning. Our product and technology have never been more important for property partners and guests. For property partners, we deliver cash flow and flexibility when their alternative is vacancy and uncertainty. For guests, we deliver contactless check-ins, lower prices, and flexibility in length-of-stay and location at a time when value, flexibility and trust are more important than ever.
While excited about this milestone, we continue to work hard, guided by the values of resourcefulness and long-term thinking that we have held since day one. Capital infusions and flashy headlines can be tempting distractions. They entice some companies to pursue growth at all costs, chasing near-term rewards at the expense of building durable operations and scalable systems that generate value in spite of volatility. We commit to using this capital wisely: we’ll invest generously in building our team, technology, and systems that drive our mission.
I couldn’t be prouder of our team and more fired up for the challenges and opportunities ahead. We are living through a generational opportunity to innovate in a sector that has long needed innovation, and we have never felt more urgency to bring our vision to the world.
On behalf of all of us at Kasa, thank you, and onwards!
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