Summary List Placement
Mexico City-based short-term rental startup Casai has raised a $48 million Series A round, the largest Series A in Mexican history.
The round is led by Silicon Valley-heavyweights Andreessen Horowitz, and also includes new funders Liquid 2 Ventures, Tom Stafford, a managing partner at DST Global, and the founders of other prominent Latin American startups.
The round is a mix of $23 million in equity and up to $25 million in debt financing from Triple Point Capital.
Previous funders Kaszek Ventures, Monashees Capital, and Global Founders Capital have also returned for this round, after participating in the company’s 2019 $5 million seed round.
The company, which has almost 200 units in Mexico City and has launched an office in Sao Paolo to support a 2021 expansion to more of Latin America, brings boutique hotel style and operation to the short-term rental space. While companies that do this are attracting a lot of attention in the United States, like Sonder to Zeus Living, the sector is less common in emerging markets like Mexico, according to CEO and cofounder Nico Barawid.
Before starting Casai last year, Barawid worked in Silicon Valley, most recently as head of international business at Nova Credit, which imports credit scores and financial histories across borders. Barawid traveled a lot for his job, and found that emerging markets often had wide variations between the quality of short-term rentals, with some lacking amenities that frequent travelers come to expect, like WiFi.
Barawid’s original concept, creating a more repeatable short-term rental experience in an emerging market, came to fruition when he met his co-founder and COO of the company, María del Carmen Herrerías Salazar. Salazar was previously a financial planning manager at Grupo Presidente, one of Mexico’s largest hotel operating companies.
“I was craving this from a consumer angle and I wanted to buy it, and she was thinking about it from an operating angle,” Barawid said.
The company launched last year, and early on had to face the pandemic and its effect on the global travel world, which shuttered short-term rental startup Lyric and put stress on Zeus Living. Barawid said that the company’s occupancy rate fell from 100% in February and early March, but is now higher than 80%.
Read more: Vacation homeowners are turning properties into quarantine havens by beefing up amenities to include protective masks and large cases of wine
He also said that the company has seen reservations start to trend longer, a substantial increase in domestic travel, and the majority of customers booking directly. Previously almost all of their bookings came through channels like Airbnb.
Barawid shared the company’s partnership deck, which they present to landlords that they’d like to partner with. The company both rents directly from landlords and has entered into revenue-share agreements, an increasingly popular trend in short-term rentals and its office cousin, coworking, where landlords share in the potential profits and in the potential losses of Casai.
Barawid said that landlords are very traditional in Latin America and can be hesitant to work with new partners, so …read more
Source:: Business Insider