Mid-2020, short term Start of lease Lyric Hospitality closed in most places it was widely seen as another catastrophic loss.
But the San Francisco-based company – which has come out to help people who have struggled to decide between a hotel or an Airbnb – is not ready to go down without a fight. Now it is moving the software side of her business, including the value proposition she built, and that subsidy raised $ 16 million in investment.
Highgate Ventures and NEA are leading the round Wheelhousewhich also included participation in the Fifth Wall, Certares, RXR, SignalFire and PAR Capital, among others.
Mostly Songs The core team reorganized and decided to focus on building what is today Wheelhouse, as the remote working environment accelerated by the disaster COVID-19 has led many people to seek long-term rent. .
And a number of companies Investors have blocked that task.
During his lifetime, Lyric secured nearly $ 180 million in debt and equity. Investors included Airbnb, Tishman Speyer, RXR Realty, Visible Ventures, SineWave, Dick Costolo and Adam Bain, Barry Sternlicht, NEA, SignalFire, Fifth Wall and Tusk Ventures.
Interview with TechCrunch, Wheelhouse founder and manager Andrew Kitchell shared details of the company’s core, new investments and future plans.
Prior to the launch, Lyric developed software called Wheelhouse Pro as part of its larger reception technology package. In addition, Lyric has also designed & managed facilities, including property that it claims to be the # 1 rated hotel in New York City..
“Sometimes I described it as, ‘Perhaps the worst place to have such a tragedy was a welcoming company backed by an adventure focused on urban travelers, “he told TechCrunch. We went out in March 2020 and it really looked like it would be a record revenue for us. “And then, literally, from March 1, we will begin to eliminate people and reduce them to 8-10% worldwide.”
Company executives did not believe they were in a cash position to survive the disaster and, instead of producing, they reduced the number of heads from 150 to 15 in mid-2020. Founder and president Joe Fraiman left the company last month. May to look for other opportunities. Those who focused their energy on building Lyric lower technology.
“When Covid fell, we were forced to close our employment company and turned our focus on Wheelhouse,” Kitchell told TechCrunch. “We were able to take the software we built for Lyric files to make Wheelhouse better and more professional.”
After about 10 months of “building,” in February 2021, the team released Wheelhouse Pro, its software for large files. With the new fundraiser, the company will “officially take over the software from Lyric,” he added.
“COVID ended up being the cause of an unexpected journey and changes in how people are and traveled,” Kitchel said. “So when COVID hit, we basically decided to say, ‘Hey, our operations company can’t live on OpCo, but we’ve really built a very exciting technology that we think the next generation of operators and hosting companies they want to take advantage of. ”
As a result it has become a B2C company and also a B2B company.
Kitchell described Wheelhouse as a “fintech platform for $ 500 billion plus flexible rental space” including cost and investment. Think professional Airbnbs and rental companies. The company says its technology has been around for more than two years, but has recently separated from Lyric to stand on its own.
“What we built at Lyric was originally a direct revenue management,” Kitchell explained. “We are taking over a house or property and we are actively evaluating it to try to help the landlord get more revenue. We have built all the equipment that our team has been using to manage the income of different properties.”
So what are the benefits of Wheelhouse for short- and medium-term stay providers? Kitchell claims that providers “may make 20% more money on rental properties and manage” larger, wider portfolios when using the company’s technology. In fact, some of Lyric’s former competitors are now using Wheelhouse , including companies that support such businesses Home Mint, Blackswan, Jurny and Sextant Stay
“We still have private hosts and entrepreneurs with several lists building their top business with our technology and we have people with 1,000 lists added, “said Kitchell.” We work with many family companies looking for both short-term stays as part of the file system, as well as an emerging part of the medium length, which can be anywhere from 30-days to nine months. “
“People are leading a sedentary life,” he added. Iyo Working with a number of companies focusing on mid-length presence has “significantly expanded” the total marketable agility (TAM), according to Kitchell.
Wheelhouse said it has experienced 100% overall growth in the last nine months and 45% growth in the first quarter. Her B2B business, in particular, has seen 500% to 600% growth in the last nine months and is now the fastest growing, and most, her business. Looking ahead, the company plans to roll out “Wheelhouse Everywhere,” which it describes as a price-generating system – from 42 countries to around the world.
The company plans to use its capital to “complete” the core technology inherited from Lyric, the middle price will stop and make some writing.
“As big teams continue to take Wheelhouse Pro, we are focused on adding features that make it easier for teams to adapt, monitor and relate to revenue strategies, our site. We also always invest in data science research to improve the ML pricing engine, ”Kitchell told TechCrunch. “Writing short-term leases is complex and requires our data and engine.”
NEA General Partner Rick Yang first invested in Lyric in mid-2017 and remained in close contact with the company during its development and ongoing transformation.
Kitchell recalls that Yang supported the start of the disaster and immediately contacted Lyric’s executive team to help them develop a strategy when their settlement declined.
“It is very interesting to see how quickly the company realized the seriousness of the situation and was able to overcome it to get to where we are today, which is very interesting and very strong, “Yang told TechCrunch. “It’s a small group, but it’s doing millions of ARRs, and you just don’t see that many times.”
Another investment-backed company that is focusing on the leasing position of the company is Zeus Living, which raised $ 55 million last year. It used to be a focus on business travelers but now it has also offered flexible rents to the general public in collaboration with homeowners. Airbnb also funded that initiative.