Silkhaus, a Dubai-based platform for short-term rentals from Infiltration, has raised $7.75 million in seed funding, which it plans to use for expansion across South Asia, Southeast Asia and the MENA region.
Venture capital firms that participated in the round include Nuwa Capital, Nordstar, Global Founders Capital, Yuj Ventures, Whiteboard Capital and VentureSouq. Some international family offices and proptech founders also joined this round.
CEO Aahan Bhojani and Ashmin Varma founded Silkhaus last year after identifying a $13 billion market opportunity for asset owners across emerging markets, particularly MENA, South Asia and Southeast Asia. In an interview with TechCrunch, Bhojani, a graduate of HBS and Yale College who previously worked in roles that required a lot of travel, such as management consulting and investment banking, said what prompted him to launch Silkhaus was the change in travel behavior in small -. post-pandemic business owner.
“At some point when I was building software for SMBs to book and manage travel globally, I saw that businesses started doing something different,” the CEO told TechCrunch on a call. “Business has traditionally always stayed in hotels. But interestingly, now they started asking for short-term rentals too, you know, basically the Airbnbs of the world. And that’s when I started scratching my head and thinking about all this gap is due to a supply and demand problem.”
The pandemic has changed the nature of travel, he said. According to him, while the frequency of leisure trips and business trips has decreased, the average duration of these trips has risen. His interpretation of this event was that these journeys became more nomadic and long-term thinking. But while platforms like Airbnb have plenty of demand to meet supply in the US and Europe, it’s a different experience in emerging markets where supply isn’t enough to meet Airbnb’s growing demand. That’s where Silkhaus comes in. It digitizes the process of operating short-term rentals for large and small property owners by providing an operating system that includes the tools necessary to monetize and manage properties. The company claims that it allows property owners to list multiple or single units on the platform with an average increase in revenue yield between 20-40%.
“Frankly, finding a good Airbnb in these markets is like pulling a needle out of a haystack. And that’s what we’re going for,” Bhojani said. “We’re bringing together some of the best short-term rental operators success and we are building the best quality provider in this inventory for our partners, of which Airbnb is one. Our big vision is to bring quality, control and technology to the space. We exist to ensure that more people can experience quality short-term rentals.”
Essentially, Silkhaus takes rental units from property owners (in Dubai, at the moment) and manages distribution, pricing, revenue management and full coverage from a digital perspective; Airbnb is one of approximately 60 different distribution channels used by Silkhaus. Meanwhile, the company has built tools on the back, which includes a market for third-party vendors to access these rentals and handle operations.
According to the CEO, Doubay was the ideal market to launch Silkhaus because its infrastructure presents one of the most advanced configurations for short-term rentals, incorporates a progressive government regulation for proptech and welcomes different demands from different types of consumers. Silkhaus’ engineering team, spread across the UAE and Bangalore, is currently building its technology stack, the company said in a statement. Chief operating officer Varma leads the team, which is part of a workforce of 20 and includes professionals from Microsoft, Airbnb, Careem and Deliveroo.
Bhojani claims that Silkhaus is now part of the top 3% of operators in the city in terms of units under management. He said the proptech startup, which has increased more than 10 times in revenue over the last 12 months, is planning to enter the top 1% in the next two months by increasing the supply of properties on its platform.
Silkhaus estimates its market opportunity could grow to $18 billion in the next four years. With operations planned for the main economic centers of Asia and the MENA region, providing guests with high-end accommodation options and letting enterprises choose extended stays for their employees on Silkhaus will be essential to take a significant share of this market.
“We are delighted to see Silkhaus emerge as the leading platform for short-term rentals across Asia, and are particularly excited to partner with Aahan and his team, who in a short period of time have proven their ability to disrupt two major, fragmented industries: real . real estate and hospitality,” Ole Ruch, managing partner of Nordstar, said in a statement.