Hotel room-by-the-hour startup ByHours raises €8m: Just don’t mention “love hotels”

Jan 21, 2020 | Media Coverage

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Travel startup ByHours is disrupting the hotel industry by allowing weary travellers to book rooms in 3, 6 and 12 hour blocks.

Barcelona-based travel startup ByHours has announced an €8m funding round, led by Mexican investors Angel Ventures and DILA Capital, which will be used to grow operations in Latin America, Europe and the Middle East, as well as to expand into the US.

ByHours was founded in 2012 and currently employs 62 people in offices in Barcelona and Mexico City. The platform offers its flexible tourism model in 3,000 hotels in 600 different destinations, proving that hotel rooms aren’t just for sleeping, according to cofounder Guillermo Gaspart.

One use case that is fuelling Latin American growth is the offer of a more secure place for professionals to rest while travelling through the region, rather than working from a local cafe.

“In terms of security in Latin America, a lot of companies don’t want their employees just walking the street in their free time,” says Gaspart. “Instead of being in Starbucks, they’d prefer you to go to a hotel with wifi and work in the hotel room.”

Don’t mention “love hotels”

Another use case that Gaspart is often asked about, and would rather he wasn’t, is the association with the somewhat seedy world of “love hotels”.

“If you speak to someone about hotels by the hour, 90% of people think that it’s just for sex or something like that. We know that and that’s why since the beginning we were clear that we are really focused on business people, travellers and families. We are not building this company to offer new love hotels.”

Gaspart says that his harshest critic in business is his mother (she is, “after the pope, the most religious person in the world”). “I always said: ‘Mum, be calm because I will never make business through that kind of environment.’”

Targeting corporate travel

Another of ByHours’ goals with the new round of financing is to grow its business-to-business operations, as a means of reaching more customers.

“The main problem for our company is awareness; people don’t know that it’s possible to book a hotel for a few hours. That’s why we want to go through other companies,” says Gaspart. He cites fellow Barcelona-based startup TravelPerk, who organise corporate travel, as a possible fit for the future.

ByHours is not the only company trying to upend the way we think about hotel bookings. French startup Dayuse allows you to book day stays at 5,000 hotels in 25 countries, but Gaspart is quick to point out that competitors don’t offer the 24/7 flexibility that ByHours does.

Gaspart, a former hotelier himself, believes that the hotel industry needs to wake up and innovate in the right places, saying that too much energy is going into technical solutions, such as booking software.

“All the innovation is more focused on technology, but nothing to do with the experience,” he says. “Hotels need to open their eyes — they’re trying to compete against Airbnb.” 

“Airbnb is the real threat to the hospitality industry right now. Hotels need to do something different, and maybe something Airbnb can’t do. I can’t imagine Airbnb offering a three-hour stay because they don’t have housekeeping, reception; it’s more complicated.”

Gaspart hopes the €8m in funding will allow ByHours to work with more hotels (the company already works with the Hilton, Sheraton and Best Western hotels) and offer more travellers a place to rest their head. And for anyone who’s had to endure a long layover at the airport, that could be very welcome news indeed.