Wimdu, a business that has been dubbed ‘the world’s largest start-up’, has received $90 million in funding just months after it was created.
The German-based company, which matches travellers with people looking to rent out rooms or entire properties, has been rolled out to 65 countries within a mere 100 days of its launch. It’s Australian launch was in May.
Two European venture capital firms – German-based Rocket Internet and Swedish investor Kinnevik – have now ploughed $90 million into Wimdu, for an undisclosed stake, as the traveller accommodation market starts to heat up in Australia.
As reported by StartupSmart earlier this month, the Ashton Kutcher-backed Airbnb, seen as a close rival to Wimdu, is also expanding to Australia.
Founded by German brothers Marc and Oliver Samwer, Wimdu already has a staff of 15 in Sydney and Melbourne, headed by national chief executive Gregory Green.
Green tells StartupSmart: “The goal is for Wimdu to be in every country and Australia is seen as a gateway to South East Asia. It’s a very important market.
“$90 million sounds a lot, but divided between 65 countries over the three years it usually takes a start-up to become profitable, it shrinks a bit. We will be frugal with it and not get dollar signs in our eyes. We will be very lean.
“This is a fast-growing market that already has quite a few competitors. There’s a lot of market movement, so why not go global from the get-go? It’s beneficial to do it this way as we learn lots of different cultural things across the markets.”
Green says the investment cash will be spent on Wimdu’s transaction process, engagement with property owners and operations. An online marketing push will attempt to boost numbers, while the company is attempting to forge links with Tourism Australia.
Wimdu’s model works by listing properties and rooms which travellers can apply to stay in. The hosts – currently about 400 in Australia – either accept or reject the application, with Wimdu taking 3% of the charge of any stay.
Green says he doesn’t want to “get into any fights or rivalry” with Airbnb, but says Wimdu’s customer service focus – the site provides reviews of properties and aids travellers who are left without somewhere to stay – will prove its point of difference.
“They (Airbnb) have a different focus to us – I know they spent a lot of time on the tech side and are only recently getting some traction,” he says. “Their tech product may be more mature (than us), but this market is a customer-focused one, not a tech-focused one.”
Asked if Australia would now see a flurry of accommodation sites start up, Green says: “There’s no barrier to entry, so anyone who can create a website can do it. I’m sure some more competition will pop up, but it’s hard for smaller players when there are two big gorillas already in the room. I certainly wouldn’t do it.”