Headquartered in California, RoomRocket is in the process of transforming the hospitality industry with a unique platform in a previously stagnating market. According to reports, the global hotel market has over USD330 billion in transactions, 750,000 properties and 15.5 million rooms. Millions of rooms are booked, bought and sold, but global transactions can be expensive, and often lack safe and cost-effective booking settlements.
Currently, almost 58 percent of hotel bookings are routed through operators and intermediaries like travel agents, tour operators and online travel agencies. Using this model, almost 40 percent of hotel margins go to operators when bookings are routed through them. This results in a loss of over USD 132 billion a year.
Platform to benefit global hospitality industry
RoomRocket aims to solve this problem by providing a single point of access to the entire market by connecting hotels with B2B resellers. This enables sales of hotel rooms on a global, wholesale basis, and utilizes Room Rocket’s proprietary multi-currency financial settlement service with a single simple contract.
RoomRocket CEO Bill Guerin says that the company addresses the urgent need for a standard global financial settlement service. He also said that the company offers hotels and suppliers to bypass intermediaries and utilize the low-cost platform. Using their platform, hotels around the world would be able to save substantial amounts in fees they would have paid to intermediaries as commissions for booking said Guerin.
With over 250,000 hotels on the platform, RoomRocket completed a pilot run in the UK resulting in over 1,500 transactions per month. The company will focus on what they term as a back-end opportunity with large hotel networks, with a focus on client capture, customer service, brand building and competitive differentiation. Their expertise in digital clearing and settlement offers all players within the system to benefit from lower operating costs, extended reach, and an opportunity to focus on core competencies.
In an effort to expand their platform and offer improved services, paving the way for a full launch in 2022, RoomRocket is planning to raise USD3 million through an equity fundraising effort. The funds received will also be deployed to build operations with an aim to scale revenue.
RoomRocket’s projections show increased profitability in the 2nd quarter of 2022.