Online hospitality marketplace Airbnb has acquired Montreal-based posh vacation rental service Luxury Retreats in an effort to broaden its appeal to customers looking for more than a couch to crash on.
The cash and stock deal reported to be worth between US$200 million and $300 million is said to be Airbnb’s biggest acquisition to date. The financial terms were not disclosed.
Luxury Retreats adds over 4,000 up-market homes in 100 destinations around the world to Airbnb’s rental portfolio. The company also adds expertise in opulent add-ons like a 24-hour concierge service that will help Airbnb target wealthier globe-trotters.
President and CEO Joe Poulin founded Luxury Retreats in 1999 after travelling to Barbados while working as a web developer. He says the high-end accommodations he experienced there inspired him to market luxury rentals online.
“I had a cook, a maid, a driver, a butler and I definitely didn’t grow up that way,” he told CTV Montreal. “I thought, ‘Well, I could be building these websites for these owners or maybe I could build my own website.’”
Like many early entrants in the technology space, Poulin says his idea was met with skepticism and rejection from financial backers. After honing a commissions-focused business plan, he started signing up property owners around the world.
“(It’s been) a many, many year rollercoaster ride,” Poulin said. “It’s constant highs and lows. As long as you’ve built a really good product or you’re focused on building the right products..… That’s always what kept me going. I know we’re building the best.”
Luxury Retreats reportedly rebuffed heftier offers from European hotel giant Accor SA and Expedia Inc. in order to retain greater control of the company. In the short-term, Luxury Retreats will continue to operate as a standalone entity. Poulin says he plans to keep his 250 employees in Montreal.
“I think it’s a great compliment to our team here in Montreal,” he said. “We’ve been very focused on our product and our service and the standards that we’ve built over the years. How we inspect our properties, it was a testament to that. Airbnb said ‘Look, we think you guys do an extremely good job.’”
Montreal Mayor Denis Coderre called the deal an example of the city’s reputation as an “innovation city.”
“This proves that Montreal, as a large metropolis, is open to the sharing economy when it is done correctly,” he said in an Airbnb media release. “Having recently met Brian Chesky (Airbnb’s CEO) and Joe Poulin, I am convinced that they will find in Montreal an ideal place to invest and continue their activities.”
With a report from CTV Montreal’s Cindy Sherwin
