Airbnb’s rising tide is lifting all boats, and today a startup that is building a number of coworking activity spaces around the world, primarily geared toward digital nomads, is reeling in a sizable round to bring its business to the next level. Selina, which operates a 22,000-bed network of boutique hostel-style operations in some 13 countries, has raised $ 100 million in funding, money it plans to use to expand its footprint to 130,000 beds across 400 properties through 2023, capitalizing on the increase in the telecommuting and the more holistic approach taken by digital nomads, who are looking for places where they can take a bite or two of life but still be productive at the same time.
In 2019 alone, the plan will be to open 35 Selina. properties in the US, USA, Germany, Portugal, Greece, Israel, Argentina, Brazil and Mexico.
Funding is being done at a post-fund valuation of $ 850 million, the company confirmed. Co-founder and CEO Rafael Museri said in an interview that the startup will likely bring in more than $ 1 billion in its next round.
This latest round, which brings Selina’s total raised to $ 225 million, is being led by Access Industries, with the participation of Grupo Wiese and existing investors Colony Latam Partners.
Selina herself has taken a page out of the digital nomad bible: the company’s first properties were in Latin America, founded in 2015 when Museri and co-founder Daniel Rudasevski resided in Panama, although the company itself was established in New York and is now its headquarters. The co-founders move to London.
In addition to equity financing, Selina has also secured some $ 300 million in country partnerships to build its shelters and related activities around the world. Museri noted that the company primarily leases the buildings where it operates its services rather than buying the property outright, so some of these local contributions will come from homeowners who pay to help renovate their locations to share in some of the returns that come from the shelters that eventually open.
“We are turning boring spaces into cultural centers, fast,” Museri describes it.
This latest funding will be used to attract more talent and build more bridges in local communities, which Selina relies on to develop its operations, which include not just a place to sleep and work, but activities throughout the day for those who stay in its rooms, as well as other venues, as well as to continue investing in their technology, which is built in the home country of Israel’s co-founders, in Tel Aviv, and specifically to improve the reservation process and algorithmic recommendations that people use to find out where to travel next, as well as what they want to do when they get there.
Selina’s rise comes at a time when we’ve seen an interesting convergence in the world of work and travel, where people are demanding an increasing amount of flexibility in terms of how they approach both.
In the world of startups, that evolution has been spearheaded by companies like WeWork and Airbnb, which have changed the concept of leasing or buying an office, or renting a heavy and soulless hotel room, which has given more interest and more. more flexible approaches to both.
In more recent times, both WeWork and Airbnb have grown closer and closer to each other, with WeWork now beginning to provide its customers with places to sleep, and Airbnb offers places to work as part of its larger business endeavor.
Notably, WeWork founder Adam Neumann is actually an investor in Selina, having been part of their previous round of $ 95 million. (That’s something to think about when considering that the We Company relocation, as it is now called, is converted to adjacent areas, like lodgings.)
While these hulking ventures represent unavoidable competition for Selina and the many others approaching the opportunity, Selina continues to develop her business not just as a co-working or co-living space in a variety of urban and exotic locations, but as a place to go to enjoy the experience, one of the reasons this funding has attracted.
“We believe that Selina’s focus on building a global hospitality platform for digital nomads will redefine the way millennials live, work, play, learn and give back,” Access Industries’ Lincoln Benet said in a statement.
Museri said that today, about 80 percent of travelers stay for 2.5 to 2.8 days, although it’s not completely unusual for people to stay 12 or 60 days, too. “It’s a process,” he said when I asked him for a more concrete figure. “If they are happy, they stay longer. If they want to move, they can jump to another Selina. It’s flexible. We have people who fall in love and stay longer, but three nights is the average stay, and it’s growing every day. “
The average age of its residents is 25 to 35, he said, but again the range is quite wide, some traveling not as individuals but in groups of friends or families.
Most of the activities are free, Museri notes, although there are also additional paid experiences you can get (example: surfing, one of the typical activities at beach properties) can be free, but the surf lessons come at a price, or basic yoga might be free, but an extended multi-day program wouldn’t).
“This is the future of accommodation,” Museri said. “Airbnb is improving, but we are doing something completely different. We do not believe that any mark touches the three spaces [of work, sleep, play] the way we will do it ”.