A new player in the boutique hotel game has entered the ring with a bang. Life House has secured $40M in funding for brand development. Out of this, $10M in venture capital will support operations and the tech platform, while $30M in real estate capital will be used to create the initial few properties in the U.S., reports Bisnow.
Life House Hotels will be driven by technology, but add a sense of in-person community with hostel-like amenities, the company says. It will roll out its first two hotels this fall in Miami, followed by a property in Brooklyn in early 2019. The properties will provide guests with a selection of private or bunk bedrooms, and communal spaces created through partnerships with local food and drink companies, all with the purpose of fitting into the neighborhood culture.
Life House intends to match people with compatible roommates using customer information, part of which will be supported by a social network for travelers on its platform. Life House wants to get referrals by offering free trips and drinks, but also intends to gain customers through data, Crunchbase reports.
“Nearly all hotel revenue is generated through online channels, but traditional hotels still structure and operate themselves like brick-and-mortar management businesses,” Life House CEO Rami Zeidan said. “We’re applying the best practices from the e-commerce space to lifestyle branded hotels and have investors who believe in our technology.”
Zeiden, a veteran executive of the hotel and real estate world, co-founded the company with Yury Yakubchyk, a tech specialist and serial entrepreneur. Global Founders Capital spearheaded the Series A round in February, and Comcast Ventures offered leadership in a seed round last September. Trinity Ventures also made a significant investment for a total of $10M. The real estate investment was led by Henley investments, which also had a hand in the venture rounds, contributing a total of $30M.
Life House structures its venture and real estate capital apart from one another, letting the operating company with venture backing be light in assets. Life House said it doesn’t just operate hotels, it will create them for owners of real estate. “The hotel and hostel space has been plagued by antiquated processes and technology,” Global Founders Capital partner Ludwig Ensthaler said. “Rami and his team have the expertise to execute on this opportunity that has high barriers to entry.”