Self-service hotel platform Xbed has announced RMB 100 million (approximately USD 16 million) as well as credit financing to the tune of hundreds of millions of Yuan in Series A funding.
The investment was led by a government-backed industry fund.
Founded in 2015, Xbed claims to be China’s first Internet hotel network, also known as unmanned hotels – accommodation can be managed through Xbed’s operational and sales system, and guests are able to manage room reservations, and check in and out of rooms using either the Xbed App or a WeChat account. Xbed uses a model similar to Uber’s in distributing short-term rentals and collective serviced apartments.
Chuntian Li, founder and CEO of Xbed, told ChinaTravelNews that the capital collected in this round will be used to further develop its operation and management system and grow its presence on an evolving scale.
“There were just about 500 listings when we completed the Pre-A round financing last year, but now we have more than 20,000 properties in 44 cities across the country with nearly a million registered users. The inventory is expected to reach 100,000 after the completion of the current round.”
Xbed claims to maintain an average occupancy rate above 80%, and the average rental period three days. The average billed amount of each order is around RMB 350, while the average daily revenue per room is about RMB 270. In addition, about 65% of the orders are made via its mobile application and WeChat account.
The business model of Xbed is similar to that of traditional hotels. As franchisees, hosts assume sole responsibility for profits and losses, and Xbed will charge a franchise fee and a 7% commission per order.
In 2017, Xbed says it broken even, ahead of its projection.
As the business is expanding and developing, Xbed has introduced a number of professionals in IT and management from Microsoft, Tencent, Didi and Baidu.