Our Thought Leader Spotlight series is a monthly profile of interesting and notable ‘game changers’ in the international vacation rental industry.
We ask these industry experts, all with different backgrounds in the industry, questions that aim to get to the core of what they view as both the challenges and opportunities facing the vacation rental industry. We also delve into how our Thought Leaders personally relate to the industry, and what they, and their businesses, bring to the collective table.
What businesses, organisations and enterprises are you currently involved with, in the industry?
As the CEO of VTrips, I am focused on the vacation rental / private accommodation sector. VTrips is a growing and innovative tech enabled property management platform offering a full-suite of solutions to both property owners and consumers.
VTrips bridges the gap between online rental marketplaces and traditional property management companies by leveraging technology to drive both marketing and operational efficiencies.
For property owners, VTrips delivers operational services like housekeeping, maintenance and guest service in labor challenging resort locations as well as managing owner statements, owner income distribution and tax filings. This operational competency is what creates the stickiness that creates exclusivity of owner property contracts.
For guests, VTrips offers a robust selection of popular destinations and exclusive inventory both on OTA sites as well as our proprietary based platforms which offer lower rates due to the exclusion of 3rd party intermediaries.
VTrips uniquely addresses both sides of the market equation by generating demand for vacation rental properties with effective marketing and yield management initiatives, while simultaneously aggregating a differentiated supply through strategic acquisitions
As a technology platform, VTrips has perfected a roll-up acquisition strategy of buying small property management companies, acquiring their exclusive contracts and integrating the new properties into existing operations.
VTrips has established an effective blueprint for successfully identifying and executing acquisitions of additional properties.
VTrips looks for acquisition candidates that have inefficient operations and marketing but are in regions of growing demand for short-term rentals. Through an initial acquisition, VTrips enters a new market and after gaining an understanding of the market grows organically.
Once established, VTrips is able to realize operational efficiencies and significantly increase ROI via its hub and spoke business model, which reduces headcount and increases profitability. Partnerships with developers provide exclusive property management opportunities when new inventory comes to market
As part of its acquisition strategy, the Company tries to maximize property share in a specific area and establish a dominant presence in order to gain synergies.
VTrips is headquartered in Ponte Vedra Beach, Florida with 150 employees in 19+ markets
What do you consider to be the key to your success?
VTrips’ keys to success start with our technology platform and operational efficiencies. VTrips has been very disciplined in our growth and acquisition strategy. As a result, the company has been able to fund growth with bank capital as opposed to venture capital.
VTrips strategy of creating a hub and spoke model that leverages the latest technology results in a robust top and bottom line financial performance.
In your view, what are the biggest challenges and or threats to the vacation rental industry?
Rental restrictions created by governments remain the biggest challenge to the private accommodations. Part of the reason for VTrips’ growth into geographically diverse territories is to diverse the risk of rental restrictions to the company. Cities like Paris, New York City and Chicago have created very strict rental restrictions that greatly reduce the feasibility of the category in part due to the strength of hotel lobbyists. Fortunately, VTrips is operating in resort destinations like Gatlinburg Tennessee, St Augustine Florida, Ruidoso New Mexico, or Hilton Head South Carolina with relatively limited hotel accommodations and where restrictions are limited as these communities rely heavily on tourism.
What counter measures would you suggest to minimise these risks?
VTrips is heavily involved in industry association and government advocacy efforts. Part of the counter measures is to proactively educate government agents as to the economic benefit of vacation rentals. Part of the counter measures is to utilize lobbyists and coalitions to work on vacation rental friendly legislative efforts to protect the category and the property rights of the owners especially at the state level. Last but not least, the vacation rental industry needs to find a way to work with the hotel companies. Vacation Rentals are a major part of the future of travel and the lines will start to blur between hotel rooms and private accommodations.
In your opinion what are the greatest opportunities for both individual property management businesses, and the industry as a whole, both now and in the short to medium term future?
Same answer as above. Rental restrictions created by governments remain the biggest challenge to the private accommodations. Part of the reason for VTrips to grow into geographically diverse territories is to diverse the risk of rental restrictions to the company.
If you were to start over again in the vacation rental industry, what would you do differently?
I would have expanded sooner into markets with less booking rules. The markets VTrips is having the most success in are the ones with less booking rules and restrictions. The average consumer simply does not understand rental markets where they can only book for a Saturday arrival and a Saturday departure during season. These booking rules also do not translate well on OTA sites.
And finally….. what and where would your dream vacation rental be, and who would you invite to share it with you?
Having travelled extensively in Southeast Asia and Western Europe, the area I am most eager to explore is Eastern Europe. From Estonia to Croatia, there is so much history and sites to see. I have a Rick Steves Eastern Europe book on my desk and a ticket already scheduled with my wife to start in Budapest this August. We will be staying of course in a vacation rental. I am planning several more trips to Eastern Europe over the next few years.
Feel free to post your comments below or ask Steve any more questions.