Platform For Booking Single-Day Hotel Rooms
Hotels By Day is an online platform that enables customers to book single-day stays in hotel rooms.
It's designed for the following types of guests:
Business travelers looking to rest up for an afternoon meeting…
Families enjoying a “daycation” — a vacation that lasts just a single day…
And those who arrive in a city after a red-eye flight.
With its platform, Hotels By Day is targeting the more than 2 million hotel rooms that are available each day. This presents a $5 billion market opportunity.
Today, we live in what’s known as the “on-demand economy.” This means people are used to getting whatever they want — groceries, a message, transportation — whenever they want it.
Companies like Uber (ride-sharing) and Airbnb (vacation rentals) have become multi-billion-dollar businesses by targeting the on-demand economy. But most hotels haven’t caught on to this new way of conducting business.
Hotels have strict afternoon check-in and late morning check-out times. This leaves a big chunk of hours during the day when rooms are empty and unused.
Traditionally, reserving a hotel room just for the day was a small niche, and had a connotation of illicit romance attached to it. This made hotel owners hesitant to open up available rooms.
Hotels By Day is changing that perception with its on-demand booking service.
The inspiration for the company came 20 years ago, when co-founder and CEO Yannis Moati was working as a tour guide, and then later as a travel agent and tour operator.
During each job, he realized that hotel operators had no simple way to book short stays, despite interest from guests. So he and CTO Brian Dass decided to create Hotels By Day.
Simply put, customers who book single-day stays receive rooms at a 50% discount, while Hotels By Day receives a 15% commission for each room booked.
Through this process, customers save money on unused hotel rooms, while hotel owners generate additional revenue by monetizing their unused space.
This has created a “win-win” situation for both customers and hotel owners, and has received praise from both hotel guests and those in the hospitality industry — for example:
“Great service,” said Nicole Sharp, a Hotels By Day user. “Got off a cruise at 9 a.m. and flight wasn’t until 4 p.m. The Pullman in Miami was a superb choice. Full service hotel with nice rooms and outdoor areas. The airport shuttle was a bonus. Would definitely use this site again.”
“It is rare these days to see something in the hospitality space that creates a new source of revenue!,” said Jeff Osborne of Greenwich Hospitality Consulting. “Hotels are open and running 24 hours, and Hotels By Day is the ideal way to better capitalize and monetize unused space.”
Hotels By Day launched in February 2015, using 15 hotels as a test model. The first year, users booked 2,700 rooms. The next year, that number increased to 12,300 rooms. Last year, it hit 28,000.
In total, Hotels By Day has generated $5 million in gross booking revenues.
The company spends $8 to acquire each customer and generates an average profit of $13 per booking.
Among its thousands of customers, 35% book hotels multiple times.
The company has partnerships with more than 700 hotels in the U.S., Canada, and Europe, and is adding an average of five new hotels per week.
In 2017, Hotels By Day appeared on ABC’s “Shark Tank” and also received its first buyout offer, which the company turned down.
Last year, the company generated $316,000 in revenue, and revenue is growing 23% each quarter.
Today, Hotels By Day is the leading “day room” hotel booking platform in North America and the company is now a profitable operation.
Recently, Hotels By Day received a “gold star” from Google Adwords, Google's online advertising service. Companies receive gold stars by establishing consistent positive guest reviews.
Hotels By Day is the only day-time booking service that allows guests to leave ratings of the service. And unlike other platforms, Hotels By Day doesn’t compare the cost of a day stay to the cost of a night stay. The company’s competitors compare these rates in order to present a misleading “deal,” whereas HotelsBy Day focuses on providing an honest, transparent way for customers to book hotel rooms.
Other online booking services have been acquired for significant prices — for example:
In 2003, Hotels.com was acquired by USA Interactive for $1.1 billion. And in February 2017, Momondo, a platform to search for and book flights, was acquired by Priceline for $550 million.
Both Moati and Dass have more than 20 years of experience in the hospitality industry.
Dass previously founded and sold two online hospitality technology companies, Timeless Hospitality and Open Hospitality. And CEO Yannis Moati previously founded FlexBook.co, a technology company focused on improving the hospitality industry.
With respect to future plans, Hotels By Day will use funds from this round to improve the platform’s interface and user experience. In addition, the company will introduce a universal loyalty program to reward repeat customers.
Hotels By Day plans to expand its services to Australia, and the company will begin selling advertisements on its website, creating an additional source of revenue.
Before starting Hotels By Day, Brian previously founded and sold two hospitality technology companies.
He formerly founded Timeless Hospitality, which was acquired by TravelClick, and Open Hospitality, which was acquired by Pegasus Solutions in 2011.
In addition to completing successful exits, Brian previously served as a general manager of a hotel as part of Casablanca Hotels.
He studied Architectural and Mechanical Engineering and Design at San Fernando Technical Institute.
Yannis has more than 20 years of experience in the hospitality industry.
Prior to starting Hotels By Day, he was Founder and CEO of FlexBook.co, a technology company focused on improving aspects of the hospitality industry.
For more than nine years, he served as a co-founder and regional manager for EAC Travel, a travel agency.
In addition, he served as Vice President of Sales for a travel company called Italian Exclusive Vacations.
Yannis earned a Bachelor’s degree in Business Administration from Northeastern University.
Eddy has served as Hotels By Day’s Chief Operating Officer for more than two years.
Prior to that, he served as an event manager for NightFolks, a Houston-area event space.
In addition, he completed internships with Kushner Companies, a real estate company.
Eddy is working toward his Bachelor’s degree in Philosophy from Pace University.