UAE’s Qstay closes $6.5 million Seed round
- UAE-based hospitality platform Qstay, has closed a debt and equity Seed round of $6.5 million.
- Founded in 2020 by Artur Khayrullin, Ekaterina Rogozhina, Alec Fesenko and Natalya Fesenko, Qstay operates as a virtual hotel brand with 200 units. It also provides digital app-based access to nearby pools, beaches, gyms and spas for its guests staying in beachfront properties.
- This funding will allow Qstay to continue investing in its technology and expand its footprint and product offering to enhance its guest experience.
Qstay Hospitality Technologies ("Qstay" or the "Company"), a Dubai DIFC-based next-generation hospitality company that is redefining the guest experience through technology and design, announced that they have recently closed on a SEED round of $6.5 million. Funding was a mix of debt and equity.
Qstay was officially launched in 2020 and was co-founded by long-time UAE resident Artur Khayrullin, CO-CEO; Ukrainian-born Ekaterina Rogozhina, CCO; Ukrainian American Alec Fesenko, CO-CEO and his wife Natalya Fesenko, the initial investor. Since its founding, Qstay has executed its mission to transform the hospitality industry through modern, technology-powered service and inspiring, thoughtfully designed accommodations, combined into one seamlessly managed experience. Qstay currently operates close to 200 properties in the UAE and Europe, 200 more are signed and expects to have 450 revenue-generating units by the end of 2022.
Qstay operates as a virtual hotel brand which provides luxury hotel-like services and amenities such as bathrobes, slippers, luxury toiletries, bathroom amenities, tea, and Starbucks coffee, additionally, Qstay provides digital app-based access to nearby pools, beaches, gyms and spas for its guests staying in beachfront properties.
Qstay holds coveted Superhost status and higher ratings on Airbnb than its competitors. That translates into an exceptional occupancy rate, which is now consistently above 80% and an outstanding REVPAR of $195, which is well above the competition. Qstay has had positive EBITDA for the last two quarters and projects to be Net Income positive in Q4 2022, only in the second year of operation.
The company's revenue has been growing at a rate of over 100% quarter over quarter and Qstay expects its portfolio to grow to over 600 units and to achieve revenue of $50 million in 2023.
Qstay’s founder and CO-CEO Artur Khayrullin says the capital will be used to "accelerate the amazing growth we've seen so far," The concept plans to expand to at least five cities across Europe and the Middle East in the next 12 months.
"Driven by QSTAY's differentiated digital service model, the Company can reduce operating costs by as much as 50% compared to traditional hotels. Through innovative technology, additional digital services such as mobile-based access to the facilities of top beach resorts and thoughtfully designed accommodations, QSTAY is revolutionising the hospitality industry," says Artur Khayrullin. "With one-of-a-kind modernised service, our guests experience an uncompromising quality with inspiring design at a price point that democratizes access to an extraordinary hospitality experience."
The company leases large groups of units in the top locations, upgrades and furnishes them to the consistent luxury standard and supports them with extensive luxury hotel-like services and amenities, providing guests with exceptionally designed accommodations at affordable prices on a nightly, weekly or monthly basis.
The company also offers text-enabled around-the-clock concierge service, and confirms that while it doesn't own any of its units, all of them "are directly leased and managed by Qstay."
"Our raise underscores the strength of the business and the rapid shift taking place within the hospitality industry due to technological innovations. Our vision for travel is making beautiful, well-designed spaces accessible to everyone with technology while providing exceptional mobile app-based add-on services," said Alec Fesenko, co-founder and CO-CEO. "We are far more efficient than traditional hotels while also providing a unique space and add-on services that are flexible enough to meet everyone's needs. Whether you're travelling on your own, for business, with your family or with friends, you will always have a space that can accommodate you."
Currently, Qstay is developing a differentiated, tech-driven platform that will provide seamless booking, digital concierge and a unified, on-demand platform for maintenance and service.
This raise will provide Qstay with additional capital to accelerate and supercharge Qstay's vision.
Qstay plans to further capitalise on opportunities within the growing $800+ billion global lodging market and strengthen its position as a differentiated, rapidly growing innovator in the hospitality industry. Over the next few years, Qstay plans to continue investing in technology and expanding its footprint and product offering to drive an unparalleled guest experience, while also delivering even greater value to its investors, real estate partners and guests.