It's a confluence of two main reasons. One, historically, the day room was associated with a romantic stay, and that's when day rooms used to be a small niche. It had a connotation of romance, which would not lead hoteliers to try to develop this segment. But what that thinking doesn’t necessarily take into account is that we live in an ever more dynamic society -- a society that, nowadays, is asking for on-demand everything, where you book everything whenever you want it, from groceries to shopping online for clothes. Hoteliers are being caught like deer in the headlights with this new trend because the model they currently run is very strict: You can only check in after 3:00. You must check out the next day by 11:00. It’s rigid. Essentially, hospitality turned inhospitable for the modern consumer.

So while the first thing hotels think is this kind of service is not made for them, we are demonstrating that there's a new frontier for them.

The second reason is that, essentially, hospitality technology is focused single-mindedly towards transacting an overnight stay, and not transacting a day stay. Therefore, the current technology landscape actually is a hard sell to plug into our system. 

So we developed an individual path of connectivity. What a hotelier would not be able to do on their own systems, they can do here. I mean, don't get me wrong, if a customer walks in at a hotel and says, they'd like a hotel room for a few hours, some hotels would be able to provide it for them. But they're not training their front desk to do so, because they've got enough problems to solve already for their night stays. What would the rate be for a day stay? How many hours would you provide for the day stay? How would you be able to check in and check out those rooms? How would you set up the housekeeping around those day rooms? We made it simple for hotel properties to use us. We prepared the whole protocol, train the staff, and everybody's happy. Essentially, these are the issues that kept hotels from doing this themselves, and why they need our company to do it for them and to scale it for them.

I started working 20 years ago as a tour guide. I moved on to travel agent, and then to tour operator. And, essentially, I realized that there was no simple way for a hotel to be flexible with its room allotments while guests nowadays required a whole bunch of different time bands that hotels were not set up to provide. I was just scratching my head to try to understand why they couldn’t they be more flexible?  Back when I was a tour guide in Italy or in France in my youth, after leaving my clients off to a Museum, I walked back to the hotel to plan the days ahead and walked through hallways of rooms sitting empty all day long. Yet, as a travel agent, every time I asked a reservation manager if I could use a day room, the answer would invariably be negative, simply because they did not have the protocols & training to run rooms for the day and turn them over back to a night stay. They’d prefer refusing the extra revenue and sit on an idle room all day long.

That mentality is anachronistic in today's society. It doesn't work. Today, inventory sitting empty, anywhere, anytime, makes absolutely no sense. We're here to solve this issue.

We launched the company in February 2015, with about 15 hotels as a test model. The first year, we had 2,700 bookings. We realized that customers loved it and wanted more, and we scaled it really fast. In 2016, we moved up to 12,300 bookings. In 2017, we had 28,000 bookings.

Right now, we have about 700 hotels, of which 50 were signed in London just last month. We are the day rooms leaders in North America, the world’s biggest market, and now are gearing ourselves up to move out internationally. We have had over 55,000 guest bookings total. So we’re growing pretty dramatically. Also, we are profitable.

The reason why we're turning to Wefunder investors right now is because extra funding would allow us to improve our technology, make it more sticky with loyalty programs, and get us to a point where we can scale efficiently at the global level.

The majority of the bookings are generated on the website and apps. And most conversions come to us through Search Engine Marketing and Search Engine Optimization.

Additionally, some of those conversions actually are being recommended by the hotels themselves. Sometimes customers have heard of us somewhere but not sure how to find us, they call the hotel directly, but the front desk again is not really trained to spend time on the phone to accommodate a room for the day, so essentially, they just tell those customers to book online through our platform. It's much easier for the hotel to lead the day-stay customer into our funnel and pay us a commission. The commission on average is 13.85%. It varies depending on how many contracts we sign with a hotel group.

Finally, more than 35% of our customers are repeat users. They keep booking with us, which lowers our costs of acquisition tremendously and increases our long-term value per guest.

About 60% of our customers are leisure travelers who just want to daycation, take a rest, meet somebody in privacy, or use all the amenities of a hotel-  the spa, the swimming pool, the breakfast-in-bed type of experience. They just want to rest for a day and take a break.

We've got 12% who are business travelers, who essentially just use our hotel rooms to be able to rest for a few hours and work in privacy, get ready for the meeting, report back to headquarters, and all that.

A segment that is new, but growing, is that 11% of our customers actually use a hotel room for napping. That's becoming a trend. You might be aware that Arriana Huffington is putting a strong focus on sleep as a part of wellness -- it’s around the concept of being more productive because you took a rest. In this society, we should not be ashamed to take a break during the day, because it actually boosts our mental skills, our productivity, our health, and our well-being in general. Right outside of your office, you can now book a hotel room, just for a few hours, where you can rest and shower, change, or even get ready for a night event, like a black tie or cocktail party that you have to attend. All our day rooms allow for more scheduling flexibility.

We also have travel agents. In the last year and a half, we've opened our platform to travel agents to make bookings with us, and we already have 287 members signed up. They're growing the business sector more than the leisure sector so far.

Finally, there’s a segment of customers who are saying that they're both leisure and business customers. It’s dubbed ‘bleisure’ and is trending, where you take a business trip but also take an extra few hours or days to enjoy the scenery or the location that you're in.

First, the average rate of return from a hotel is about $75 per month of commission revenue. We have 700 hotels signed up with about 350-450 hotels live in any one day, as they all cycle because some hotels have different booking cycles. So it’s very hard to define a cost of customer acquisition on that side of the marketplace.

But on the guest side of things, we can measure the cost of acquisition a lot more precisely. When we launched this business, the cost to acquire a new customer was over $150. It’s now just $8 to acquire a new customer online through search engine marketing. And we’re making, on average, $13 per booking. So we're in the black within the first booking. Additionally, 35% of our customers book multiple times, from twice all the way up to over 90 times.

The large booking sites are not interested in our model because, as I mentioned earlier, the whole day-stay ecosystem does not connect to the hotel central reservations systems. Because of that lack of booking fluidity with the hotels, the large online travel agencies feel that this is not worth the effort. They're making a million times more bookings than us, and so this niche -- the effort of growing this niche and being part of the future and not the present of how people book a hotel and how they travel -- is not on their radar. They are aware that we exist, but they don't necessarily care, because they're definitely at a higher volume when it comes to their traffic. They don't want to be encumbered by a model that does not plug with all hotels automatically.

As for other day-time booking operators: if you do a quick search and see how we portray ourselves versus how they portray themselves, you'll realize that when we claim to be a customer excellence company, it's not just empty words. For one, you'll see that we're the only agency in that sector that actually has ratings from our guests. We are being graded by them at very high levels. We're rated on Google, just to give you an example, 4.6 stars out of five, which is absolutely phenomenal. Not even a five-star hotel reaches that level of excellence.

Secondly, if you look at our platform versus our competitors, we do not compare the cost of a night stay to a day stay. We think it's misleading to the customer as well as lowering the brand value of the hotel. Our competitors, for the sake of a quick conversion, are ready to compare day-stays rates with night-stays rates. That doesn’t make sense and it's unethical. Our level of honesty, clarity, transparency, customer-centered service, in the American way of servicing a customer, is just simply unmatched. It sounds shallow to say it, but we focus wholeheartedly on our customers and on our guests, and that's the recipe to our success. Guests come back to us over any other platform, allowing us to lower the acquisition cost overall, enabling us to grow and be profitable.

What we are testing right now is onboarding apartments. It was not part of the original plan, but we’ve realized that apartment owners are a lot quicker in making a decision than hoteliers. They also run the same model as a hotelier, where they run 80% of their occupancy throughout the year and have gaps throughout their booking patterns, whether it be by week or by year, and they wish to fill in those gaps. And we’re the only company that can fill in those gaps.

The size of the market in apartment listings is absolutely monumental, and we'd like to tap into that market right now. We're about to sign contracts for apartments in Miami, Boston, Toronto, and New York. It's essentially opening the apartment model for day stays and short stays. We’re very excited by this development.

We're incorporating more hoteliers with each passing week and diversifying their income. I think that where we differentiate from some of our industry colleagues: we don't jeopardize our relationship with hoteliers as we're not out there to harm them and pray on them. We're actually bringing them extra revenue that they didn’t even know it existed! We're empowering the little actors, franchisees, and housekeepers. We're now pulling out this passion project called the Generous Envelope, which is about distributing envelopes with inspirational quotes so that people can tip their housekeepers.

So on a broad scale, we're more of a customer excellence company that an online travel agent, simply because we don't do things the same way that others do it. That's why we have such good reviews online and such great feedback not just from guests but from hoteliers. We're really out there promoting our core values – our living, breathing values – which is empowering people, showing respect, and boosting hotels’ revenues. If the guests have a good experience at the hotel, they’re more susceptible to stay for the night and book direct. We’re bringing hotels new clients for a very low acquisition cost. While on the surface we just look like we're a revenue optimization company, which we are, we offer benefits that go way beyond that.

In some of the key cities, like Toronto, Miami, Boston, New York and Los Angeles, we have more demand than supply, so apartment rentals would be no small feat to onboard. It would unlock inventory in a tremendous way. It would boost the possibilities of selling rooms, and it would allow us to catch up with the latent demand that we have already. That's one of the methods of growing the bookings, because we know that there's so many cases right now where regrettably the guest is not satisfied with inventory.

The second phase of our growth plan is training. We're three years in the making. We have acquired the skill in selling our model to hotels and apartment owners alike. We have all the marketing material. We have all the lingo to be able to sell it correctly, knowing what their pain points are and how our solutions can solve them. So we've acquired a lot of knowledge on that front. We've also acquired a lot of knowledge in guest-facing marketplace. We know which keywords convert guests. We know which days are most popular. We know which locations. And we are testing out now, in London, all of those theories. We're training local staff to sell in the U.K., and we are seeing that our model of conversion in London is working out, even in an environment of increased competitive pressure. Soon we will be ready to scale it to English-speaking countries. We've got Australia, Singapore, and Hong Kong in the target. And then, eventually, we’ll move into Europe and Latin America as well.

We're seeking to raise $107,000, mostly to invest in our technology, so that we can do more with less.

We want to be more fluid with guest conversions by improving our UI/UX, grant the customer more control over the time-band they wish to book, as well as integrate map features, so that the guest need not waste time inserting the hotel address on a different app and stay longer on ours. 

Our second plan to build stickier apps is to create a user profile and launch a universal loyalty program, which will boost repeats and lengthen the long-term value (LTV) of a customer. 

Finally, we identified many ways of improving features on our back-office, enabling the hotelier to better track and improve their listing on our channel.  We must take advantage of the fact that we’re becoming a steady source of extra income for hoteliers who are increasingly relying upon us to make their ends meet (check our industry testimonials on our website).

We plan to spend about 30% of the funding on marketing so we can grow internationally. I mentioned Australia, Singapore, Hong Kong, but also Germany and Scandinavia, and Latin America -- all that takes a lot of effort in training staff correctly, creating a base for our local entrepreneurs to be able to develop a market under our brand HotelsByDay.com so they can become global winners with a formula that we were able to successfully implement in the United States.

To be the uncontested leader in day rooms all over the world. That's what we are working towards today. That's why we wake up every morning. We are the leaders in the U.S. right now, and we will replicate this model successfully all over the world.

Eventually, we see ourselves as a branch of a larger travel company. One specifically that has been thought for some time is getting closer and closer to the hotel world, is Airbnb. Here's a huge company that's leading the way in transforming lodging, and we think that we are, in our own niche and in own regard, transforming lodging as well. And so if we keep up that momentum of transformation, we think there is a fit.

Thanks to our good ratings and reviews, we also think TripAdvisor, for the sake of being able to acquire new customers against the larger online travel agencies, might also be interested in our model. We’ve seen a few travel companies that might be interested in acquiring us. In having these lines of communication open with our customers that used to be disregarded, we are now becoming more and more a force of the industry.

However much sense our model makes for the hotel industry, I regret to say that we are still encountering a lot of resistance from the established hoteliers. They are not necessarily in lockstep with today's societal trends. They're not moving as quickly as they should in trying to incorporate new models. Resistance to change in any industry, at any level, any age, is always a clear and present danger for established models. And more so to an established model like hospitality, which has been selling hotel rooms for night stays in the same way for centuries. Hotels By Day coming in and turning the model on its head is facing resistance. There's a knee-jerk reaction to think that the day room is necessarily a romantic stay. But it's not. Not that we don’t have some of it -- I'll be the first one to say a portion of our bookings do have that component because we're selling hotel rooms, so whether it's night stay or day stay, romance happens. But our effort is about messaging a larger audience, business travelers, leisure travelers, that now they can take a daycation, they can stop for a few hours to refresh, work in privacy, get ready for the meeting, or unwind from the meeting.

Consider that the model of hotel stays has been in place for, essentially, millennia. Lodging, an inn somewhere by the side of the road, has existed forever and ever. And the check-in and check-out process with their fixed time bands has been locked in for a long time. Beyond that, every hotelier that goes to hospitality school, gets professionally trained, and works at hotel chains which own 70% of the inventory in the United States, have very structured ways of doing business.

We're coming in with a different way, and the industry hated it at first. Just to give you an example, at our press launch, a major hotel brand sent a circular to all their hoteliers stating: "We forbid you to sign with Hotels By Day. We think this is disruptive to our model and operations, and we think you should not sign with Hotels By Day.” Besides the fact that I shat in my pants that day when I heard about this letter, it just goes to show how calcified their thinking is. Additionally, by the way, they're ever more profitable. Hotels have been running on record profits for the last six years. Hence they are not pressured to close the loop on their revenue cycle to generate more revenue during daytime hours. 

But the old thinking is breaking in front of our eyes. Even the branded hoteliers said, “Never mind this circular, I don't care, I'm going to sign with Hotels By Day because I'm sitting on way too many empty rooms during the day and it sinks me.” And so those single hotels we signed in Philadelphia, those hotels that we signed in New York, those hotels that we signed in Chicago when we first launched, have now flourished to 700 hotels. 

Yet the mentality is still alive. It will take another few years for everybody to realize that it does make sense to generate revenue during the day. 
That day, we’ll all reap the benefits of that change of mentality: guests, hoteliers, our company, and our investors.