Houst makes it easy to host on platforms like Airbnb, Booking.com, HomeAway & Expedia.
- Managing 6,000+ homes across 22 Cities
- £120 Million in bookings, + 52% YoY revenue growth
- Over 250,000 bookings
- Investment conditional upon Future Fund funding - see Key Info
Learn more about convertible loan campaigns.
🎯 22 Cities.
🎯 6000+ Homes.
🎯 250,000+ Bookings.
🎯 £120m+ in host revenue.
Houst are already one of the biggest short-let management companies in the world. But we’re just getting started. We partner with homeowners, advertise their properties on platforms like Airbnb, and use technology to help manage bookings. From cleaning and laundry, to guest communication, key collection and pricing - tech is at the heart of all that we do.
In June 2019 we closed our last Seedrs campaign. Over 1000 people helped us smash the £1 million target in just a few days. And we’ve been busy since...
✅ Acquired our biggest rival.
✅ Revenue up 52% YOY.
✅ Implemented a bold new brand.
Now we’re back. We’re giving you another opportunity to support our mission to define great, modern hosting. With COVID-19 changing travel trends around the world, we believe that there's never been a better time to join us.
Substantial accomplishments to date
Since launching in 2015, we’ve been growing. Fast. The story so far:
📍 ‘Airsorted’ launched in London with three properties and one cleaner: our founder James.
📍We launch in 2 new cities: Edinburgh and Dublin.
💰Raised seed funding of £1.5 million.
We launch in more UK cities and gather momentum in Australia and New Zealand....
💰Completed a £5 million Series A funding round.
💰Raised a further £2 million via crowdfunding on Seedrs.
📍We launched in 12 new cities, from Toronto to Cape Town.
💰Raised £1.25 million on Seedrs
📍Grew market share in our cities
The last 12 months have been our biggest yet:
Hostmaker acquisition: In February we acquired the assets of our closest competitor, increasing our managed properties in our largest market London by 750 homes. We acquired over 250 homes in Lisbon and Barcelona, 200 homes in Madrid, and significantly increased our market share in other European cities too.
Revenue +52%: By growing existing markets, improving our host retention rate, and optimising guest prices we've increased our revenue by more than half in the last year.
Houst rebrand: Five years on from launching Airsorted, we revealed our new name and visual re brand.
We have a pricing model that starts from 12% + VAT up to 18% + VAT, depending on the market conditions in each city. This model means we only make money when our hosts make money, completely aligning our interests with theirs.
Our strategy in the short to medium term is to maintain focus on delivering the expansion of our core business model, rather than looking at alternative revenue streams. However, we have a breadth of long–term strategic options we are considering. Possibilities are not limited to our host-customers, but also include monetising additional (add-on) services to guests to compliment their stay. Since launching in 2015, we’ve managed over 250,000 guest bookings.
Use of proceeds
Kickstart after COVID-19. The pandemic inevitably reduced our revenues in the short-term. But we took quick and decisive action to fast-track restructuring post-acquisition, automate areas of operations, and shift all properties towards medium-term lets. As a result, we believe that we'll be able to kickstart faster and more strongly than our competitors.
Unify the market. Emerging in a strong position provides a unique opportunity to grow our position as a global leader. There are hundreds of small property managers globally, most stuck with less than 100 homes because they don’t have the tech or capital to grow. We are approached regularly by operators looking to sell up and join the Houst group. We believe that here lies our opportunity.
Please note that the company has a £2.5m bank loan where it has been agreed that no capital repayments will be made this year. They also have a £50k bounce back loan. Funds raised as part of this round will not be used to pay these loans.
Future Fund Information
Seedrs is supporting companies who are intending to apply to the Government backed Future Fund. You can read more about the Future Fund here: https://www.seedrs.com/learn/blog/the-future-fu....
In order for a company to be eligible to seek matched funding from the Future Fund, this investment round must be on the convertible loan terms that have been prescribed by the Future Fund for this purpose. These terms differ to our normal ‘advanced subscription agreements’.
Given this product differs from most campaigns on Seedrs, we urge all investors, including regular Seedrs investors, to read the information below and ensure you understand the terms in full before making your investment.
1. Key terms
You will see a term sheet attached to this Campaign in the Documents section which sets out the key terms of the convertible loan and you can see the full document prescribed by the Future Fund here: https://www.british-business-bank.co.uk/ourpart....
A summary of the key terms is set out below, but should be read in conjunction with the term sheet:
- Discount: 20%
- Interest: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount). See the Term Sheet for more details.
- Redemption Premium: An amount equal to 100% of the principal loan amount
- Valuation Cap: The Valuation Cap will be set based on the Revenue in the 12 months immediately prior to a Qualified Funding Event as per the table below:
The “Valuation Cap Share Price” is determined by dividing the Valuation Cap by all issued shares and outstanding rights to equity in issue in the Company immediately prior to the Conversion Date.
“Revenue” shall be defined according to International Financial Reporting Standards (IFRS).
For the avoidance of doubt this calculation will not apply if The Investors elect to convert in a non-Qualifying Funding Event, where a £28,000,000 Valuation Cap will be used.
- Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lowest share price of equity financing less the Discount or, if lower, the Valuation Cap share price.
- Maturity Date: 36 months from signing convertible loan agreement.
The default position on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
If redeemed, the company will repay the principal together with the Redemption Premium.
If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount). Or, if lower, at the Valuation Cap share price.
Other events of default or conversion: There are various other scenarios in which the convertible loan may convert or be repaid and investors should reference the term sheet:
- Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. Please see the term sheet for how this conversion is priced.
- Exit: The convertible loan will automatically convert or be redeemed on an Exit, whichever would give investors the higher cash return. Please see the term sheet for how conversion is priced and payments on redemption in this scenario.
- Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up. See the term sheet for more details.
2. Government matched funding
The company intends to apply to the Future Fund for matched funding on the total eligible amount invested in this funding round. The Future Fund will “match” the funding raised via Seedrs or other eligible sources, subject to a minimum investment of £125,000 and a maximum investment of £5m. The Future Fund is to be allocated on a ‘first come, first served basis’, so there is no guarantee that a company will receive the Future Fund matched funding.
This campaign is conditional upon receiving matched funding from the Future Fund. Seedrs will not complete the investment and transfer the funds raised until we have confirmation that the Future Fund matched funding application has been approved and that the Future Fund is ready to make the investment. If the application is denied, the campaign will be cancelled and funds will be returned to investors.
Because this campaign is conditional upon the matched funding, you will see that we have reflected the Future Fund investment as part of the round. It is distinguished in pink in the progress bar of the campaign. This is to give investors an indication of the potential total size of the funding round (and potential dilution on conversion), but to also distinguish it from regular investment through the Seedrs platform.
Seedrs does not charge any fees in relation to the Future Fund matched funding, application process or for acting as lead investor with respect to applications.
3. Conversion to equity
The convertible loan agreement prescribed by the Future Fund is equity focused and favours conversion of the loan to equity as the default position.
Redemption is only available in certain scenarios and is often subject to the vote of majority of the investors. Where a vote of investors is required, Seedrs will vote on behalf of any investors it represents as nominee.
There is a possibility that the convertible loan will convert in some scenarios without the consent of Seedrs (if we do not make up a majority of investors). It is also Seedrs’ position that this is primarily an instrument for investing in the equity of the fundraising business and our default position would be to vote in favour of converting the loans to shares in the company, unless there is a clear or compelling reason not to.
As always, investors should be aware of and accept the risks involved in investing in early stage and growth focused businesses: https://www.seedrs.com/pages/risk-warnings
In addition to the usual risk warnings included above, investors should be aware of and accept the following with respect to convertible loans:
The convertible loan agreement is intended as bridge funding to a future funding round, but there is no guarantee that a company will be able to secure further funding.
The Future Fund is to be allocated on a ‘first come, first served basis’ and there is no guarantee that a company will be successful in its application to receive the Future Fund matched funding.
There is a risk that the Company may not have sufficient funds to repay the loan on the maturity date, pay interest when it becomes due or pay the redemption premium included in the terms.
Convertible loans are unsecured obligations and in the event of a winding up or liquidation event will rank behind secured creditors of the Company.
5. Secondary market
Investors will not be able to sell their interest in the convertible loans on the Seedrs Secondary Market unless and until they have converted to shares in the company (and then only subject to eligibility and the terms and conditions of the Seedrs Secondary Market).
6. EIS Relief - past, current and future
As noted above, the convertible loan instrument is not compatible with EIS requirements, so no EIS applications will be made with respect to investments in the convertible loan.
The government has confirmed that investing in the convertible loan will not impact EIS relief previously claimed on investments in the fundraising company:
“The government has confirmed that such previous investments will not be affected where the convertible loan converts into shares. Where the convertible loan note redeems, we have been alerted that the government intends to make changes to the rules to clarify that this is compatible with such previous investments.”
However, investing in a convertible loan could impact your ability to claim EIS relief on future investments into the same company. The government has not clarified the position on this and has said it is a matter for HM Treasury and HMRC.
Seedrs is unable to provide tax advice. Tax treatment depends on individual circumstances and is subject to change.
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