Investors continue to bet big on Vacasa.
The Portland-based vacation rental management company today raised another $64 million from existing investors. Riverwood Capital led the round, which included participation from Level Equity, NewSpring, and Assurant Growth Investing.
The cash infusion comes just one year after Vacasa raised a big $103 million Series B round. The company, ranked No. 2 on the GeekWire 200, bootstrapped for six years but has raised more than $200 million since 2016. Revenue is up 60 percent year-over-year.
Vacasa bills itself as the “largest vacation rental management company in North America” and offers various services — marketing, rate optimization, reservations, guest services, housekeeping, maintenance, etc. — to help homeowners earn money off their property. It has more than 10,600 vacation homes listed on its site across the U.S., Europe, South and Central America, and South Africa.
“Vacasa has exceeded every key business metric since our first investment just over a year ago,” Jeff Parks, managing partner at Riverwood Capital, said in a statement. “Unit economics, customer retention, geographic footprint, homeowner and guest satisfaction, and both organic and acquisitive growth are on an accelerated trajectory.”
Vacasa CEO Eric Breon declined to provide an updated valuation, though it ranks among the most-funded startups in Portland and the Pacific Northwest. Breon said the fresh cash puts the company in a position to go public.
“That is something we are continuing to prepare for,” he said of an IPO. “When you look at the scale of the market opportunity, the scale of our company as it is today, and the scale of the opportunity looking forward, that is what we believe makes the most sense for the company.”
Vacasa’s platform is powered by lots of technology; it uses proprietary yield management software that updates price rates daily based on hundreds of variables like weather, events, competitor pricing and occupancy, regional demand trends, season demand curves, and more. The idea is to maximize revenue for property owners that list homes on Vacasa.
Vacasa is similar to platforms like Airbnb, which reached valuation of $31 billion last year, and HomeAway, which was acquired by Expedia for $3.9 billion in 2015.
But Vacasa has a few key differences — namely, it is a “full-service property management company,” helping homeowners manage the entire booking process from start-to-finish. In addition to more than 500 people working out of offices in Portland (which just doubled in capacity) and Boise, the company employs 2,000 people across its markets for on-the-ground “field-based roles” — housekeepers, reservations agents, local managers, etc.
Vacasa counts Airbnb and HomeAway as partners, providing inventory for their marketplaces.
“We are very focused on the homeowner,” Breon said. “So instead of just putting the [properties] on our own site or just on Airbnb or just on HomeAway or just Booking.com, we distribute the homes we manage to all those markets so they are exposed to as many guests as possible.”
Breon added that the traditional Airbnb host is “entrepreneurial,” or someone with an extra bedroom who is looking to make some cash, for example. Vacasa’s core demographic, on the other hand, are homeowners that “don’t want to be involved in the day-to-day,” he said.
However, Airbnb and others are moving onto Vacasa’s turf. Airbnb bought a company by the name of Luxury Retreats for about $300 million last year. Luxury Retreats describes itself as a full service villa rental company that offers 24/7 personal concierge and curated property listings. Targeting more professionally-managed vacation rental listings could be one way for Airbnb to better prepare itself for its own IPO, Skift noted in last year.
Earlier this year, Vacasa launched a new network aimed at helping people through the process of buying and selling second homes. Breon expects that to be a “huge part” of the business over the long term.
“If someone is looking to buy a second home and intends to rent that home, we can service that buyer better than anyone else out there,” the CEO said.
In that vein, Vacasa could be seen as a competitor to tech-fueled real estate brokers such as Redfin. But Breon said the companies have different target markets; Vacasa is more focused on more “sleepy” markets while Redfin typically does business in urban markets.
Just two weeks ago, Vacasa acquired Hyatt-backed Oasis Collections.
Other large funding rounds for Portland-area companies this year include $200 million for Jama Software; $100 million for Exterro; $50 million for Vetsource; $42 million for Puppet; $33 million for Twistlock; $25 million for Urban Airship; $18 million for SheerID; and $14 million for Lytics. Vancouver, Wash.-based nLight raised $96 million in an IPO.