Kristian Valk launched Hotelchamp in 2015 after realising just how dependent most travellers are on third party booking sites. The dominance of the likes of Bookings.com and Expedia has overshadowed hotel websites to the point that it challenges the longevity and success of the hotel industry. Valk speaks to GrowthBusiness on how his Amsterdam-based start-up is shaking things up in the sector.
What does your business do?
Hotelchamp boosts direct bookings and build guest relations for hotels. Globally hotels are facing a huge challenge, since online travel agencies like Booking.com and Expedia are very dominant in this market. Our aim is to disrupt the hotel industry by creating a healthy balance between direct versus third party hotel bookings. We create a sustainable future where hotels are less dependent on third parties and have more control over revenue, profitability, customer engagement and data. Which in the end, will benefit the hotel guests as they receive more value for money.
Where did the idea for your business come from?
Two years ago, we were heavily alarmed by the current situation of the hotel industry. My co-founder’s girlfriend was searching for an hotel while arranging a trip. My co-founder Kasper pointed out the following process; she was looking through major bookings platforms before visiting the hotel website for more information but was always returning to the online travel agent websites (OTAs) before making a reservation. After a little research, we realised how dependent hoteliers were on OTAs. We believed that by combining our knowledge in e-commerce and technology we could help we could help hoteliers to better compete online and help them to win back their customers.
How did you know there was a market for it?
There is huge momentum in the hospitality industry. Every hotel in the world is facing the same challenge in the distribution of selling their rooms. Third parties like Booking.com and Expedia are very dominant and hotels are depending on their bookings. As a result of the rising commissions, there is a big need for more direct bookings. Offering a solution to solve this problem is the main driver for the disruption. We are empowering hotels being less dependant on third parties and gain back control over their revenue, profitability, customer engagement and data.
How did you raise funding, and why?
From the beginning we handpicked our angel investors, both from the technology and hospitality industry. We believe in the benefit of our business angel’s knowledge and creating extra leverage through utilising their network. Currently we are in contact with many major international venture capitals.
Describe your business model in brief.
Hotelchamp works according to a SaaS model; its average fee is €300 a month. Our customers are earning back three to five times these costs. And, unlike with commission-based models, they don’t have to pay more whenever they succeed. We always offer a fixed price.The hotels’ earnings from direct bookings can be invested in improving services.
What was your first big milestone and when did you cross it?
The first big milestone was this year when signed our 1000th customer.
What advice would you give to other entrepreneurs?
One of the biggest learnings in my career is to invest a lot of time in hiring people who have a 200 per cent cultural fit with the company. Employees at Hotelchamp are called “Champs” and we have a very clear view on the profile description of a typical Champ that fits our company. One of the main drivers why our company is growing so fast is because of the champs team all being so energetic, ambitious, entrepreneurial, proactive and have a great drive to skyrocket the company by reaching their own goals. This company culture gives such a vibe and energy, I have never experienced before in my career so far.
Where do you want to be in five years’ time?
Our aim is to disrupt the hotel industry by creating a healthy balance between direct versus third party hotel bookings. We want to create a sustainable future where hotels are less dependent on third parties and have more control over revenue, profitability, customer engagement and data. Which in the end, will benefit the hotel guests as they receive more value for money. The hotel industry is huge with over 500,000 hotels world wide and 550 billion revenue. Since we connected over 1,000 hotels, there is an enormous growth potential for Hotelchamp.
If you weren’t an entrepreneur, you would be…
I can’t imagine not being an entrepreneur, but in this case I would go for being a professional runner. Although I’m extremely busy with Hotelchamp, I try to run at least one or two marathons like the ones in New York and Berlin.
What is your philosophy on business or life, in a nutshell?
Anything in life is possible when you are passionate about your project. Impossible only means that you haven’t found the solution yet.