2 Comments

Summary:

The deal gives Berlin’s 9flats its first North American base and comes with some notable benefits for iStopOver’s existing user base. But where does it leave the market?

9flats

The peer-to-peer accommodation service 9flats just got a whole lot bigger. On Monday, the Berlin-based company announced the acquisition of Toronto’s iStopOver, a move that gives it its first North American base and doubles its total offering of beds to more than 100,000.

First off, the expansion confirms Stephan Uhrenbacher as one of the German startup scene’s key players. Not only is he the founder of 9flats, but he’s also the founder behind Yelp rival Qype, a popular European recommendation portal.

“North America, one of the world’s largest travel markets, is the most important market for 9flats outside of Europe,” Uhrenbacher said. “The integration of iStopOver will strongly contribute to our growth in this region and will both open a completely new geographic target audience for us and double our offerings at the same time.”

With services such as these, solid customer support is fairly essential. 9flats says it will open up positions in its new Toronto office and effectively double the size of its current support team.

iStopOver’s existing customers will also get a boost from the deal – they’ll no longer have to pay booking fees, due to 9flats’s company policies. Details of the transaction were not revealed.

Looking at the competition, market leader Airbnb has around 200,000 listings. Rocket Internet’s Wimdu has roughly 50,000 and HouseTrip somewhere north of 100,000. But beds aren’t the same as listings – obviously, some properties have more than one bed.

“We chose to estimate the benefit of the transaction conservatively, but we estimate to be at 100,000 apartments/homes within three months after completion of the transaction,” Uhrenbacher told me via email.

So where exactly does the deal leave 9flats, relative to its competitors?

Considering the company was only founded early last year, the acquisition puts it in a pretty strong position, albeit still slightly behind HouseTrip and way behind Airbnb. Indeed, it gives 9flats almost the same user base size as that of Airbnb’s European operations alone.

Wimdu, meanwhile, finds itself lagging. It potentially has access to plenty of funding – Rocket raises money at an astonishing rate, with key investor Kinnevik having put in more than half a billion dollars so far this year – but, unlike Airbnb and 9flats, Rocket’s outfit has not yet been on the acquisition path.

It may be that buying sprees are the best way to catch up at this stage of the game.

You’re subscribed! If you like, you can update your settings

  1. Ch. Auer-Welsbach Tuesday, August 7, 2012

    That’s what Europe needs, success stories that show and motivate entrepreneurs that you don’t need to be in SV to develop and grow a successful company.

    The European market is underdeveloped and underestimated. Europe’s 700m potential customers are going to be the market of the future to develop, grow and run a world-wide scalable successful business.

  2. Melissa from Enrout Wednesday, October 10, 2012

    And the plot thickens! I wonder how the market will develop considering the increased competition and state regulation on short-term renting, such as San Francisco. Any thoughts, David? Thanks for the post!

Comments have been disabled for this post