The Entrepreneur: Arnaud Bertrand, HouseTrip
Young Gun and holiday rental site co-founder Bertrand on securing $60m backing, the future of travel accommodation, and making "wrong" hires...
Founder: Arnaud Bertrand
Description in one line: One of the world’s largest holiday rentals marketplace
Previous companies: NA
12 month target: NA
Describe your business model and what makes your business unique:
- We’re a marketplace for holiday rentals: hosts list entire properties that holidaymakers can book through our website. HouseTrip takes a commission on each transaction.
- We differ from our competitors in that we only list entire properties (no spare rooms, air-beds, etc.) and we go above and beyond everyone else in the level of quality control that we do on our properties and the quality service that we provide our guests.
What is your greatest business achievement to date?
What I am most proud of is the great satisfaction scores we get from the millions of guests who’ve experienced HouseTrip – on independent review service TrustPilot our rating is 9.4 out of 10!
What numbers do you look at every day in your business?
- Guest satisfaction scores
- Number of bookings and revenue
- Number of new properties listed
- Conversion rate
- Daily variable costs and gross margin
To what extent does your business trade internationally and what are your plans?
We have properties and bookings in pretty much all countries around the world. We have over 300,000 quality houses, apartments and villas in 19,000 destinations.
Describe your growth funding path:
- 2009/2010: 3 seed rounds for a total of about $1m
- End 2010: Series A round led by Index Ventures for $2.5m
- End 2011: Series B round led by Balderton Capital for $17m
- End 2012: Series C round led by Accel Partners for $40m
What technology has made the biggest difference to your business?
The two major technologies we use are Ruby on Rails as our framework to develop our web products and we store everything in the cloud with Amazon.
Where would you like your business to be in three years?
We think that our category has tremendous upside potential; our target audience is rapidly catching up to the fact that they’re getting great value by renting a home as opposed to staying in a hotel. I see a not too distant future where our category will be the most popular type of travel accommodation, and of course HouseTrip will remain one of the largest players within the category.
What is the hardest thing you have ever done in business?
The hardest thing has always been dealing with difficult times, which you inevitably face when you manage a business. You’re in the eye of the storm and you need to have enough stamina to make the right decisions and see things through.
What was your biggest business mistake?
A business is all about people and, as such, a wrong hire can have terrible consequences and I’ve made a few wrong hires over the years. Taking the time to properly vet candidates is crucial.
Piece of Red Tape that hampers growth most:
In our industry it has to be regulation; in a number of important destinations we’ve had regulators institute laws that greatly limit our ability to grow locally.
What is the most common serious mistake you see entrepreneurs make?
Not being clear on what they’re about and their operating model. Too often entrepreneurs have a tendency to hedge their bets by having a “fit-all” identity and a vague operating model, thinking they can adapt more easily – but that’s often a mistake. The best companies know exactly what they are about and are very clear on how they go about operating.
How will your market look in three years?
I think that within three years our market will have grown tremendously and will be close to catching up with hotels as the most popular form of travel accommodation.
The guest experience will have improved further thanks to professionalised suppliers and additional services given to them (e.g. ability to order “room service” from local restaurants, etc.)
What is the single most important piece of advice you would offer to a less experienced entrepreneur?
Seek clarity on what your company is about and your operating model (i.e. how the company goes about growing and ultimately becoming profitable) as fast as possible. If you remain unclear on this it will be unclear not only to your clients (who would buy something from a company that doesn’t quite know what they sell?) but also to your employees (how can I do a good job for a company that doesn’t know what it’s supposed to do?).
I am a big foodie so my biggest luxuries are eating in nice restaurants and cooking nice food.
Executive education or learn it on the job?
Pretty much all on the job. I studied in a hotel school so I wasn’t exactly educated on how to manage and grow a tech company.
What would make you a better leader?
Communication – in any organisation keeping staff up to date and engaged is critical (especially when you grow to hundreds of employees as is our case)
I love all the books by the author Michael Lewis. He is by far the best business writer of the past two decades, my favourite books by him are the classic Liar Poker and his latest book Flash Boys. John Brooks is also an excellent author, his Business Adventures is a must read.