Latest / Brand Insiders / Building the Future of Hospitality: An Interview with Niko Karstikko, Co-Founder & CEO of Bob W

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Building the Future of Hospitality: An Interview with Niko Karstikko, Co-Founder & CEO of Bob W · Brand Insiders

• 0:08
  SPEAKER_01: We're here with Hospitality Net for an episode of Brand New focusing on innovative hotel brands.
• 0:16
  SPEAKER_01: And today's an exciting episode with Nico Karstico, co-founder and CEO of Bob W.
• 0:23
  SPEAKER_01: Nico, how are you?
• 0:25
  SPEAKER_01: I'm loving live.
• 0:26
  SPEAKER_01: Thank you, Adam.
• 0:27
  SPEAKER_01: Thanks for having me on the show.
• 0:30
  SPEAKER_01: Well, thanks for having us.
• 0:31
  SPEAKER_01: So I'm here in Toronto and Nico, you're in Helsinki at one of our.
• 0:40
  SPEAKER_02: Just got back to Helsinki from a f uh for a week and a half of holidays with the family and nice and refreshed and in one of our one of our Bob W locations.
• 0:48
  SPEAKER_01: Awesome.
• 0:48
  SPEAKER_01: So yeah, you can showcase the background there to show off all the, I guess, the vintage uh lamps that you have in the background that you you have from the restored uh restaurant that was there before.
• 0:58
  SPEAKER_02: Yeah, upcycling deserves a chance that we're trying to play in our part.
• 1:02
  SPEAKER_01: Awesome.
• 1:03
  SPEAKER_01: So Nico, who is Bob W.
• 1:07
  SPEAKER_02: So Bob W is really the the hospitality concept, the brand that's answered the answer to the Airbnb generation that's grown up.
• 1:19
  SPEAKER_02: Um it's that hybrid between uh the hotel and the short stay rental.
• 1:25
  SPEAKER_02: It's that uh uh uh you know you know what you get, Airbnb type experience on steroids that's scalable and that addresses the needs of the customer, and at the same time, uh from a real estate side is really uh playing into the flexibility of the new emerging conversions and the and the needs from office conversions to to uh hospitality conversions to um retail conversions uh that the market's looking for as the market's changing.
• 1:55
  SPEAKER_01: Okay, so Bob W was founded in around 2017-18, is that correct?
• 2:01
  SPEAKER_02: Yeah, two thousand and uh 2018, December is when we opened up the first apartment, which is literally my random apartment in a random apartment building.
• 2:12
  SPEAKER_01: Okay, but uh where I'm going with this is a lot of times the best companies, if you look at the early founding, it was that kernel, which was almost a compulsion to fix something that was wrong in the world that you saw.
• 2:27
  SPEAKER_01: So, what did you see that was wrong in the world of hotels and in short-term rentals that really compelled you to uh give up your life to found a company?
• 2:38
  SPEAKER_02: Uh, good question.
• 2:40
  SPEAKER_02: Um to answer that, I think we need to go back a little bit.
• 2:43
  SPEAKER_02: You know, uh I'm I'm Finnish originally, but I've lived in five countries, studied abroad, worked abroad, um, you know, spent time with family, family who moved abroad, etc.
• 2:54
  SPEAKER_02: Um, so really from an early, early days, really live this life that wasn't just about travel for the weekend or the week, but was also that sort of gray area of needing a temporary home or staying for weeks or or for months or a semester and that kind of thing.
• 3:12
  SPEAKER_02: Which really, if we look back uh 15, uh, you know, 10, 15, 20 years ago, there wasn't the wholesale solutions out there.
• 3:21
  SPEAKER_02: And particularly then we've had this massive push uh from the travel behavior of this emerging generation where people actually can mix business with pleasure and can work remotely.
• 3:33
  SPEAKER_02: And so that gray area has grown exponentially.
• 3:35
  SPEAKER_02: But I felt that from a like personal experience perspective.
• 3:40
  SPEAKER_02: Then I worked at uh corporate corporate America and corporate UK uh in in banking and in digital marketing, and the tie was getting a little too tight around the neck.
• 3:51
  SPEAKER_02: Uh, so I became an entrepreneur and started a fitness activities marketplace where we raised a bunch of capital back in uh you know back in 2012.
• 4:00
  SPEAKER_02: Um and uh and I was I started with an American guy based out of New York.
• 4:06
  SPEAKER_02: Uh he was the other co-founder, so we'd always travel back and forth.
• 4:09
  SPEAKER_02: And I was a broke startup founder, so I was trying to figure out how to make ends meet.
• 4:14
  SPEAKER_02: And uh so I heard about this new platform that had just you know landed landed in Finland at the time, and I was like, okay, I'm gonna rent my apartment out.
• 4:23
  SPEAKER_02: And uh, you know, loved hosting, loved making people feel like they're welcome to your own community and that sort of and loved traveling with Airbnb, was an early adopter on that front.
• 4:35
  SPEAKER_02: And of course, with the hosting, loved making the money, uh, you know, um loved playing the game of getting great ratings and having a fabulous experience for people.
• 4:44
  SPEAKER_02: And I think a lot of hosts out there who do it for the love of the game know what I'm talking about.
• 4:50
  SPEAKER_02: And uh then in 2016, I exited my last business, a fitness activities marketplace, and I did a one-year transition CEO position.
• 4:59
  SPEAKER_02: And when that was up, I thought, hey man, I've I've been burning the candles from both ends.
• 5:04
  SPEAKER_02: I want to take a break.
• 5:05
  SPEAKER_02: I'm gonna go travel Asia.
• 5:07
  SPEAKER_02: Uh, and of course, during that course, I'm thinking I had amassed this like portfolio of seven apartments: my apartment, investment apartment, brother's investment apartment, family summer home near the Capitol, uh, and a few buddies' apartments.
• 5:21
  SPEAKER_02: And I was trying to figure out, you know, how am I gonna make this thing happen?
• 5:24
  SPEAKER_02: I've got zero employees, just a cleaner that I use.
• 5:27
  SPEAKER_02: And uh um, so when I'm gonna be travel at the same time when I'm gonna be backpacking and traveling across Asia.
• 5:34
  SPEAKER_02: And uh, you know, I figured out, okay, six months of soap in the closet, good-to-do list for the cleaners, chat-based customer service, a couple of good backup plans for the keys, um, and in general, backup plan, which was my at the time broke brother that would do anything for 40 bucks.
• 5:51
  SPEAKER_02: Uh, and so he was he was the the helper there.
• 5:54
  SPEAKER_02: And uh I figured, yeah, I can make this happen.
• 5:57
  SPEAKER_02: I can be traveling in Asia and I can make this thing happen.
• 6:00
  SPEAKER_02: Uh, and it's got enough fail-saves to keep keep these great ratings and and this this great financial performance happen.
• 6:07
  SPEAKER_02: But at the same time, this started me thinking, like, man, this whole Airbnb world is such an amateur show that uh if we were actually in control of uh the technology, the hardware, the IoT devices, and we'd had the commercial resources of a hotel conglomerate or a hotel chain or a real estate developer to actually develop the space for its purposes, you could actually create something that wouldn't just match the expectation of a hotel.
• 6:36
  SPEAKER_02: But for the modern traveler that ain't looking for a hotel, that's factually spending a longer time on the road, just like me, and is mixing with business with pleasure, just like me, would you would actually create something that could exceed the expectation uh of a hotel?
• 6:52
  SPEAKER_02: And that was the backdrop.
• 6:53
  SPEAKER_02: And then I went to Asia, and then of course, there I felt this fatigue towards these uh short stay rental platforms because it was always the same problems.
• 7:02
  SPEAKER_02: Do you trust the host?
• 7:04
  SPEAKER_02: Do you trust the pictures?
• 7:05
  SPEAKER_02: What about what about key pickup?
• 7:07
  SPEAKER_02: Yeah, it's real pictures, isn't the ghetto?
• 7:10
  SPEAKER_02: Will the washing machine work this time?
• 7:11
  SPEAKER_02: Last time it was listed but didn't work, etc.
• 7:13
  SPEAKER_02: All these issues that are inherent with this mom and pop fragmentation uh and the lack of maturity in the short stay rental platform.
• 7:22
  SPEAKER_02: Then, of course, there's the questions about legality, you know, you don't want that Barcelona vibe where the local tourists hate you and all that stuff.
• 7:29
  SPEAKER_02: And uh so that was the the thinking background, and that that you know pushed me back towards the hotels, even though that wasn't what I was looking for, you know, it wasn't it wasn't what I was going for.
• 7:40
  SPEAKER_02: Uh I wanted that independent travel, I wanted the washing machines, I wanted, I wanted uh, you know, none of the frills I'm paying for, anyways, but I wanted to like satisfy this modern independent traveler's needs that I represented.
• 7:54
  SPEAKER_02: So, you know, you end up washing your drawers at the Hilton's uh uh bathroom because you don't want to spend 12 bucks just the same amount of price as the actual underwear cost to do it again.
• 8:04
  SPEAKER_02: So so uh um that that was really the backdrop.
• 8:08
  SPEAKER_02: And then I started talking with my German co-founder who I met studying abroad ages ago, and and we started understanding the Oxy massively fragmented market.
• 8:16
  SPEAKER_02: You know, on the one hand, you've got hotels, which are you know, in Europe 7 million plus hotels, uh consolidated, uh they're they're one place, uh, sorry, sorry, they're 50% plus branded or brand affiliated.
• 8:29
  SPEAKER_02: Uh, there's clear standards, five-star, four-star, three-star, where consumers, operators, and developers know what to build.
• 8:36
  SPEAKER_02: Now, contrast that with the shortstay space.
• 8:39
  SPEAKER_02: You know, a couple of percent are professionally branded, completely mom and pop.
• 8:44
  SPEAKER_02: There is no big players, there's no standards, there's no such thing as a four-star, one-bedroom shortstay apartment.
• 8:50
  SPEAKER_02: There's not even a name for it.
• 8:51
  SPEAKER_02: Shortstay rentals, short-term rentals, vacation rentals, extended stay, apart hotels, apartment hotels, or as consumers say, Airbnbs, but Airbnb doesn't own or manage or rent the apartment.
• 9:02
  SPEAKER_02: So this, this, you know, this was really that was the lead up to this aha moment that we are going to create uh, you know, the most loved hospitality product for that next generation of traveler, that independent traveler, uh, that uh that that traveler that mixes business with pleasure factually spends an average longer time on the road, is digitally savvy.
• 9:25
  SPEAKER_02: And uh what we thought was probably a bit of a niche product has you know really proved itself that it's mainstream as today.
• 9:32
  SPEAKER_02: We're across 11 countries in Europe, uh, 19 cities, just in Helsinki alone, which is the capital of Finland, 1.32 million people in the metropolitan region.
• 9:42
  SPEAKER_02: We've got six live properties and more in the pipeline.
• 9:45
  SPEAKER_01: Well yeah, you know, we're talking about here uh is an ecosystem.
• 9:52
  SPEAKER_01: I keep coming back to this word ecosystem because your experience is the micro of the macro being this rise of hybrid travelers and people who now that Airbnb has been around for over 10 years and there's a bunch of other short-term rental platforms like Verbo, they know that their options exist.
• 10:13
  SPEAKER_01: They know they have the ability to work remote, uh, whether there's return to work policies or hybrid, but them knowing about this now propels this market forward for more and more hybrid travel, people just like you mixing work and pleasure.
• 10:32
  SPEAKER_01: So, on that note, I'm wondering if you could talk about just very briefly about Bob W, where you see it fitting into this rapidly pro proliferating hybrid work status and some of the ways that you, your brand specifically meets the needs of this cutting-edge traveler.
• 10:54
  SPEAKER_02: Yeah, yeah.
• 10:55
  SPEAKER_02: So maybe, maybe just to add to the earlier point is that we operate in commercial properties in under the right legal framework and hotel licensing and what have you.
• 11:06
  SPEAKER_02: So it's important for probably the listener to understand that we do this at scale.
• 11:10
  SPEAKER_02: So we're not a platform of random apartments.
• 11:13
  SPEAKER_02: We are, from a legal perspective, an apart hotel operator and a tech company that operates hospitality.
• 11:20
  SPEAKER_02: Um, but to to get to that point in terms of what space do we occupy in this in this changing environment is well, first of all, let's look at the very clear facts.
• 11:36
  SPEAKER_02: Is again we have this proliferation of of uh of people spending a longer time on the road uh with a more varied set of use cases.
• 11:46
  SPEAKER_02: Um so family alone, uh with friends, uh come for the meeting, stay for the weekend.
• 11:55
  SPEAKER_02: Um, hey, I'm gonna do uh uh one month to live closer to my mom's hometown for for you know to change get a change of scenery, etc.
• 12:04
  SPEAKER_02: The use cases are broadening, and there are plenty of options to fit into this sort of hybrid hospitality area from that are somewhere between traditional hotel, which is few nights of uh, and to one year plus lease or rental contracts of an empty apartment that you got to furniture yourself, furnish yourself.
• 12:26
  SPEAKER_02: So there is this massive proliferation in between.
• 12:29
  SPEAKER_02: Now, of course, on the longer end, you've got co-living, which is months and years that people spend time.
• 12:35
  SPEAKER_02: It is in place of your home for the most part.
• 12:39
  SPEAKER_02: Uh, then you've got, of course, you've got the uh sort of one month plus corporate, usually the corporate stays and what have you, um, which is traditionally being called, even though of course the use cases are broadening.
• 12:52
  SPEAKER_02: And then there's this thing where we don't have to show up Monday morning to the office and leave Friday at 5 p.m.
• 12:59
  SPEAKER_02: You know, when I was starting corporate career, that was your only choice for a weekend trip was grabbing the last fright on a flight on Friday evening and coming back Sunday night to make it to the office on Monday morning.
• 13:09
  SPEAKER_02: I mean, you had a desktop too, so it wasn't an option.
• 13:13
  SPEAKER_02: Um, so we occupy that still, you know, our average length of stay is just shy of four nights.
• 13:19
  SPEAKER_02: Now, of course, there's a lot of one-nighters uh week visitors, there's corporate relocation travel, um, etc.
• 13:28
  SPEAKER_02: So we that bell curve has a lot of different uh length of stays and use cases, but we average four nights, which if you compare it to European capitals, it's 1.5 nights on average.
• 13:38
  SPEAKER_02: So that's where we are from a length of stay perspective.
• 13:41
  SPEAKER_02: So we've got the kitchens, we've got uh we we we've got breakfast, we're full service offering all this, but actually not in the building, but through technology in the marketplace in the neighborhood.
• 13:51
  SPEAKER_02: We've got washaterias, we've got uh uh luggage storage rooms, we've got pantries, so you can grab a new towel if you if you need one, et cetera, and we've got periodical clean.
• 14:02
  SPEAKER_02: So we we we we cater to that days and weeks gang.
• 14:07
  SPEAKER_02: That's our sweet spot, but of course we offer a broader set.
• 14:11
  SPEAKER_02: So that's where the the physical product stands.
• 14:13
  SPEAKER_02: Now uh and the second part is of course related to these use cases.
• 14:18
  SPEAKER_02: The modern traveler wants to be independent, so we don't have front desks because for the same as your every damn other app knows your uh you know, your ID and your credit card information.
• 14:28
  SPEAKER_02: We remember it too, unlike your favorite hotel.
• 14:30
  SPEAKER_02: Um, so we have that convenience of arrival uh of the you know the the tech savvy generation, which you don't even need to be that tech savvy.
• 14:37
  SPEAKER_02: I mean, we've got 80-year-old customers that are really happy with us.
• 14:41
  SPEAKER_02: Uh and it's the utilities and amenities allow you to travel independently, but continue the routine and the basics going on in your journey.
• 14:51
  SPEAKER_02: If you travel enough, you want to go to the gym during your travels.
• 14:55
  SPEAKER_02: You want to have a night in, you want to watch Netflix, you want to have the occasional porridge that you make yourself instead of having that, you know, uh the more unhealthy stuff in the restaurants and all that stuff.
• 15:05
  SPEAKER_02: So those are I think the the three areas that we're really occupying from that perspective, from a consumer standpoint.
• 15:13
  SPEAKER_01: Yeah, and uh, I guess as a segue here, now we're talking about segmentation and how all your different segments are combining to build out your distribution.
• 15:25
  SPEAKER_01: So therein, um, if we could drill down to one specific segment you talked about, the corporate relocations or uh you know, executives that need a place for a month before they find a permanent place or maybe two months.
• 15:40
  SPEAKER_01: How do you go about putting yourself front and center in front of these various segments to then draw them in and make sure that they know that Bob W is a brand they can trust for these types of travel purposes?
• 15:57
  SPEAKER_01: That's a that's a good question.
• 15:59
  SPEAKER_02: There is, you know, uh corporate travel historically is a pretty fragmented market, particularly in Europe.
• 16:07
  SPEAKER_02: Uh extended stay has more maturity in North America, but historically it's a complete mishmash.
• 16:14
  SPEAKER_02: Um then you combine that.
• 16:17
  SPEAKER_02: So let's start from the product, which is always a great place to start, is you don't have a brand, therefore, you brands, therefore, you don't have consistency.
• 16:26
  SPEAKER_02: Which consistency, anyways, in a short stay rental, is the big problem.
• 16:30
  SPEAKER_02: If you don't have standards and you don't have brands that represent standards, you don't have the consistency.
• 16:35
  SPEAKER_02: And obviously, Bob brings that.
• 16:36
  SPEAKER_02: So you have to have consistency though.
• 16:38
  SPEAKER_02: So quality is equivalent, same guest experience upon arrival, the booker can trust that you're gonna you know what you get every time you arrive.
• 16:46
  SPEAKER_02: Um, and that's that's something that we you know uh that we can we can deliver on and what that that that crowd is looking for.
• 16:56
  SPEAKER_02: Then the other aspect of it is they've got they're looking for solutions to their travel problems.
• 17:03
  SPEAKER_02: Um and historically, you know, hotel, sorry, the the corporate operators and HR teams would have to reach out to corporate elite relocations for that exec who's coming in uh you know with their family in one month.
• 17:20
  SPEAKER_02: They would need another to get their junior employees to stay at one hotel, they would need another for the fancy hotel, and and then uh for other purposes, they would, you know, they would Airbnb or they would do uh find another solution.
• 17:35
  SPEAKER_02: Now, when you're able to cater to the short-term and the mid-term needs, we're actually able to be a one-stop shop answer.
• 17:44
  SPEAKER_02: And I think that's really the the answer there is we've got enough design and boutique hotel credentials that mid-managements and top management's happy to stay with us.
• 17:53
  SPEAKER_02: You've got the utilities and amenities to allow for people to stay longer for their needs, and you've got enough room mix to have some of the bigger apartments so that you can relocate the whole family.
• 18:05
  SPEAKER_02: So all of a sudden you're a one-stop shop.
• 18:07
  SPEAKER_02: So I think that that combination of brand standards, um catering to a broad set enough of needs, and then being able to uh you know uh uh really serve the different use cases.
• 18:23
  SPEAKER_02: I think that combination is is what uh how how we have managed to successfully really take a part of that market.
• 18:31
  SPEAKER_02: It represents roughly speaking 40% of our business, uh which is the B2B um uh segment.
• 18:36
  SPEAKER_02: And it's a great leg, particularly in the off-seasons.
• 18:40
  SPEAKER_02: Um and we've invested in that, you know, we've built systems for it, then we've got a B2B team that works across Europe, and we work with some of the largest global brands to relocate people, but also to bring their executives in for one night.
• 18:54
  SPEAKER_01: Yeah, you know, that was uh one thing uh I always ask uh hoteliers is particularly in Europe, anyone can fill a hotel in summer, but who is your guest on a rainy, snowy, dark night uh a Wednesday in February?
• 19:13
  SPEAKER_01: And it's probably those corporate guests, I guess, right, to build out your base.
• 19:18
  SPEAKER_02: Yeah, that that's exactly it.
• 19:19
  SPEAKER_02: Um, and uh and that's so we we play historically a hotel's obviously very ADR and RevPAR focused, not so much length of stay, but because of our utilities and amenities that we offer, we can play the length of stay card, and of course, the attractiveness of that differs to different seasons, and through that the different use cases are different.
• 19:40
  SPEAKER_02: So, in short, uh, you know, we're we're very happy to have that B2B leg to stand on.
• 19:46
  SPEAKER_02: And another, which is not strictly leisure travel, is we call it uh uh we call it need-based travel.
• 19:53
  SPEAKER_02: So that's basically, you know, we do a lot of insurance temporary homes when people, I don't know, have some kind of accident at their apartment and they need to leave.
• 20:02
  SPEAKER_02: Uh, we do, you know, people have pipe renovations in their buildings, like which happens a lot in uh every 50 years in Nordic countries, they'll stay at our properties and this kind of thing.
• 20:12
  SPEAKER_02: So, so to have a essentially that means a broader, uh uh broader set of distribution channels, which you can then you know lever differently during the different seasons and uh different demand periods.
• 20:29
  SPEAKER_01: Yeah, yeah.
• 20:30
  SPEAKER_01: Without uh going directly into the technology, I still want to talk about where you're placed, but to talk about those levers and do you offer any length of stay incentives to drive this longer stay?
• 20:45
  SPEAKER_02: Yeah, so we've got length of stay incentives on a daily, weekly, monthly basis.
• 20:51
  SPEAKER_02: But of course, uh our revenue management, which is done done in-house, in-house for for the most part, um we uh it's a lot more nuanced than that.
• 21:03
  SPEAKER_02: And that allows, of course, for us to really find the right customer at the right time and to to really um you know be able to optimize our gross operating profit across the business.
• 21:16
  SPEAKER_02: So we really really are focused on that uh is let's use that to our advantage since we have got utilities and amenities to support that.
• 21:23
  SPEAKER_01: Awesome.
• 21:24
  SPEAKER_01: So just for full context here, uh you mentioned you're in 19 cities across 11 countries.
• 21:33
  SPEAKER_01: Uh are there any particular ones you want to discuss in terms of those markets that you're very happy to be placed in?
• 21:40
  SPEAKER_01: And also any uh any competitive markets that you're especially proud of to be to be fighting tooth and nail with uh with the big boys, the big chains?
• 21:51
  SPEAKER_02: I I guess I guess uh uh for us it's the flexibility of the product.
• 21:58
  SPEAKER_02: Um That we're very proud of.
• 22:01
  SPEAKER_02: So we are we are from Madrid to located in Madrid to London, has over 10 properties, to Athens, Greece, to uh some you know, Munich, Germany, to smaller towns like Lübeck, Germany, to Turku, Finland, uh, to Parnu, Finland.
• 22:19
  SPEAKER_02: Um and we are also also because of the flexibility of our real estate, as we are full service, but we don't have need the shared spaces or the operational spaces associated with a full service, we're able to be a bit more flexible.
• 22:35
  SPEAKER_02: So our units vary from 10 units to 200 units in a in a per property.
• 22:41
  SPEAKER_02: So that flexibility is actually the thing that we are very proud of.
• 22:46
  SPEAKER_02: And because we're a technology company operating hospitality and we've got one-seventh of the employees of a comparable hotel making comparable RevP car, um we're able to expand a lot more nimbly.
• 22:58
  SPEAKER_02: So we just opened within the span of three weeks our first two properties in Stockholm, Sweden, which now is where we're in all the Nordic capitals.
• 23:07
  SPEAKER_02: Um, and we hired three people.
• 23:10
  SPEAKER_02: And uh uh hired three people and and and operating almost 100 units.
• 23:15
  SPEAKER_02: So so we we're able to keep that, thanks to the technology, extremely high quality, as we're the best-ranked international hotel operator in Europe, but still at a fraction of the cost, which on the one hand you're saying cost, but actually it's about having a great experience.
• 23:33
  SPEAKER_02: Um, and uh we can use technology to actually reduce human error, but still deliver that amazing signature Bob W experience.
• 23:42
  SPEAKER_01: Wow.
• 23:42
  SPEAKER_01: So average key count can't really be estimated because you mentioned 10 to 200 keys per per uh per hotel or per uh hotel.
• 23:52
  SPEAKER_02: Yeah, so if you look at our existing portfolio, we're about 60 to 70 keys.
• 23:56
  SPEAKER_02: And if you look at our uh uh upcoming portfolio, it exceeds 100 keys, and the biggest property, I think, is 200 something units, uh closer to 250, if I recall.
• 24:08
  SPEAKER_02: Um and that is more of flexibility, of course.
• 24:12
  SPEAKER_02: That means because we can go to office conversions, we can do uh old sub-sized hotels that are too small for uh the the marriage of the world, uh, but still very economically feasible, particularly for us, because we've got such low overhead uh cost associated with that.
• 24:30
  SPEAKER_01: Yeah, and uh you talk about that you mentioned um being more efficient and not having to devote spaces like the full service hotels.
• 24:40
  SPEAKER_01: Are you able to put a number on it in terms of uh uh floor area efficiency in terms of where you're able to meet versus other hotels?
• 24:51
  SPEAKER_02: Yeah, I mean, the I don't have the exact number for you, but what I can tell you is uh, you know, we have uh what the only thing that we need, uh whether whether it's our Copenhagen 165 units or this, an old hotel convert hotel to a part hotel conversion, 55 units here in Helsinki, is the only space we need are of course the minimal operational spaces.
• 25:17
  SPEAKER_02: And I'm I'm not talking front desks, obviously, or or big staffing areas, but I'm talking linen and and and cleaning and cleaning uh cleaning staff, which we generally use a third party using our technology AKR app to control them.
• 25:31
  SPEAKER_02: Um uh we we just need on top of that pantry, washaturia, unless the washing machines are in the rooms, which depends on the property, and uh uh uh luggage room, washateria, pantry.
• 25:44
  SPEAKER_02: And pantry is of course a very nicely curated self-service.
• 25:48
  SPEAKER_02: Um pick it up, pick it up your your yourself.
• 25:51
  SPEAKER_02: And of course, Bob can sort it out for you, but that's usually what our customers prefer.
• 25:55
  SPEAKER_02: Uh so if then you can start thinking seeing is okay, so we don't need any of the shared spaces.
• 26:00
  SPEAKER_02: We of course do a great job with the lobbies, but ideally, from an efficiency perspective, the lobbies of just a hallway into an elevator.
• 26:09
  SPEAKER_02: Um uh because from a business model we don't need it.
• 26:12
  SPEAKER_02: Now, in this case, we had blind areas where you can't put a room because of legislation reason.
• 26:17
  SPEAKER_02: We've got a lovely winter garden that I'm here in Helsinki with a nice uh social kitchen and a hangout, which got co-working credentials.
• 26:25
  SPEAKER_02: Um, and it's a great place to be at.
• 26:27
  SPEAKER_02: And we the bigger the buildings get, you generally have some of that inefficient space that you can't turn into units.
• 26:32
  SPEAKER_02: But basically, we try to turn every single space into units because that's how our how our business model operates, and we find the customers are very happy with that regardless.
• 26:41
  SPEAKER_01: Yeah, and then and then you have partnerships as well.
• 26:46
  SPEAKER_01: So, for instance, you don't have an on-site gym, but you'll offer partnerships with a local gym just down the street, or uh what how do you develop those partnerships to round out the amenities for Bob W?
• 26:58
  SPEAKER_02: Yeah, so maybe a short look back.
• 27:00
  SPEAKER_02: So, again, my last startup was a fitness activities marketplace.
• 27:03
  SPEAKER_02: So thousands of gyms, yoga studios, rock climbing arenas in one app, and you could use our app and show up anywhere.
• 27:10
  SPEAKER_02: Now, of course, all of those have got different systems, just like the breakfast spots and gyms do these days as well.
• 27:15
  SPEAKER_02: Uh, so we we created this in the last startup, this amazingly seamless experience with an app and a third-party service where it feels like it's a natural part of that.
• 27:24
  SPEAKER_02: Now, we've taken those same learnings into Bob W.
• 27:27
  SPEAKER_02: So we are a full service operator, but we don't have any of the operational complexity uh related to it.
• 27:33
  SPEAKER_02: So, yes, breakfast is never almost never in the building.
• 27:36
  SPEAKER_02: Um, and but it's available through the app.
• 27:39
  SPEAKER_02: You can have a bed and breakfast rate or purchase it separately, and it's within a few hundred yards.
• 27:43
  SPEAKER_02: It's always two options at least.
• 27:46
  SPEAKER_02: Uh, and uh it's I can guarantee you more authentic, more amazing, better value for money, and better vibes than most of us can create.
• 27:54
  SPEAKER_02: You know, good restaurateurs are very different business to a hotelier, of course.
• 27:59
  SPEAKER_02: Um, and then we've got gyms are always included in the price, and we all know what you know the mid-market, mid-scale hotel gym looks like.
• 28:09
  SPEAKER_02: It's a for lack of bird, piece of shit uh on the under a lower ground floor with eight weights uh and you know two treadmills.
• 28:18
  SPEAKER_02: And uh uh I can guarantee you that again, that modern independent travel, we've got complimentary free gym for you to use as much as you want, but it's a real local gym, uh reputable, usually reputable gym chains that you just show up, punch the code in through the door, and you're in.
• 28:36
  SPEAKER_02: And uh and and you get to it's where locals hang out.
• 28:39
  SPEAKER_02: So again, modern travelers want to live like locals and get that local vibe.
• 28:43
  SPEAKER_02: It's a real gym, it's a big gym.
• 28:45
  SPEAKER_02: They've got classes, uh, they've got changing rooms, they've got saunas, they've got all this stuff.
• 28:50
  SPEAKER_02: So our approach was really is modern traveler wants to live like a local.
• 28:55
  SPEAKER_02: We want to embed them into the neighborhood.
• 28:57
  SPEAKER_02: So let's use those services and really embed them beautifully, seamlessly into our guest experience, into our guest app, where it isn't just a recommendation, it is a seamless part of the Bob W experience allowing you to live like a local.
• 29:12
  SPEAKER_01: And and yeah, I love that you segue back into the app because all this is app enabled where the guests can have access the local gym, get their one-time access punch code to get into there, and it's all seamless to them, but then behind the scenes things are daisy chained together in the tech stack.
• 29:32
  SPEAKER_01: So I'm wondering if you could give us some more details on the actual IT systems architecture of Bob W and how that's created uh a value for the brand overall by both driving down OpEx and also acting as intellectual property to propel the brand forward further forward.
• 29:53
  SPEAKER_02: Yeah, so I guess our background was, and my background, I was a tech entrepreneur, right?
• 29:57
  SPEAKER_02: So I was just uh what you'd call an amateur host, right?
• 30:00
  SPEAKER_02: And uh um which sometimes serves well when you're an outsider to the industry because you don't have the, oh, it's always been like that, and for these reasons, so it should always be like that in the future, kind of thinking.
• 30:14
  SPEAKER_02: Uh, which of course the hotel industry's success, but also probably the reason why there's been challenges really renewing itself is because it's so heavily standardized and has big brands that have their own effectively universities and management programs that then in a way are have a lot of interchangeability in their approach.
• 30:36
  SPEAKER_02: Um so so so for us, we always saw ourselves from the get-go as a tech company that operates hospitality.
• 30:45
  SPEAKER_02: That we are unchaining ourselves from the conventions of what a three-star hotel should be to instead solving problems uh for the modern traveler.
• 30:56
  SPEAKER_02: That that you know, that Airbnb generation that's grown up and growing up.
• 31:02
  SPEAKER_02: And uh so we from the get-go started building our own tech, and today that's of course uh the back end, consumer apps, uh, cleaner apps, operational apps, uh, our own customized uh guest communicating platform, uh, which is which is AI-based.
• 31:19
  SPEAKER_02: Um again, that might sound like, oh, nobody's talking to you.
• 31:21
  SPEAKER_02: It's uh co-piloting methodology.
• 31:23
  SPEAKER_02: So we're you're still talking to a real person, but we can find that information about the microwave.
• 31:28
  SPEAKER_02: You can't get to work a heck of a lot faster than manually scrounging for it.
• 31:32
  SPEAKER_02: Um uh, and of course, it speaks in all a Bob W tone, which is this amazingly warm guy and uh, etc.
• 31:40
  SPEAKER_02: So um so uh we've we've built this whole stack ourselves.
• 31:45
  SPEAKER_02: Of course, in the modern day, there is always a question about buy and build, and this is getting a bit murkier with AI, but you know, buy versus build, I could argue that no company should ever build anything that you can buy better off the shelf.
• 32:02
  SPEAKER_02: You know, pick pick your USPs, pick your competitive advantages, uh, pick your differentiators, and do whatever the as little as you do 10 times better than everybody else.
• 32:15
  SPEAKER_02: And for us, it really is guest experience, it's autonomous hospitality.
• 32:20
  SPEAKER_02: That doesn't feel like autonomous hospitality, and it's full, full service offering.
• 32:26
  SPEAKER_02: Uh, so it is that marketplace effectively.
• 32:28
  SPEAKER_02: So we realities we're no service offering, but to the consumers, we are a full service offering, and believably so.
• 32:35
  SPEAKER_02: Um, and uh uh so uh so and that's the thing, and that's what we've really built on.
• 32:42
  SPEAKER_02: And I think the end result is the customers, and again, we're at at at you know clo closing in almost on 80, 80 NPS, 76, I recall, uh, was the latest latest quarter, uh, and uh uh hovering between 4.6 and 4.7 on uh customer service based on all public ratings across these 11 countries that we operate in.
• 33:05
  SPEAKER_02: We are the best ranked.
• 33:07
  SPEAKER_02: And I think that there, you know, that is that really is what the technology allows us to do, which we're actually even more proud of than reducing the people.
• 33:16
  SPEAKER_02: The reducing of the people is a function of the platform working.
• 33:21
  SPEAKER_02: Um, and again, we're in the most labor-intensive industry in the world, which is prone to human error.
• 33:26
  SPEAKER_02: And the more people you have, the better teams you need to build.
• 33:29
  SPEAKER_02: You got to manage those teams.
• 33:31
  SPEAKER_02: There's churn, all that stuff.
• 33:32
  SPEAKER_02: The less you have of that and you allow for the technology, you also reduce human error, and therefore, on average, you have happier customers.
• 33:40
  SPEAKER_02: And I think those are the outcomes of the technology.
• 33:44
  SPEAKER_02: And we have had several unsolicited offers to to license or or or actually purchase the whole company as well, with the technology being a big part of that, where they want to roll it out to their uh portfolio of of brands.
• 33:59
  SPEAKER_02: Um, we we're we're not at that stage yet that we would we would probably probably entertain that seriously, um, because we have been selfish in building it for ourselves and really see it as a competitive advantage as we go forward.
• 34:15
  SPEAKER_01: Uh and I'm still drawn back to this word consistency.
• 34:19
  SPEAKER_01: And what you're essentially saying is the technology and the tech stack that you have is at the core of this consistency, which is the brand promise and the brand trust.
• 34:31
  SPEAKER_01: And then that propels Bob W forward to be a trusted brand for all these various segments that rely on a trusted product because you're not just uh you know in and out of there in 1.5 nights like you are at a standard hotel.
• 34:46
  SPEAKER_01: You're trusting this place for a seven-night stay where you're also working and attending meetings, where you need to do laundry, where you want to have a quiet night in and expect the casting technology to work so you can get Netflix.
• 34:59
  SPEAKER_01: And that's essentially what you're saying is the technology is at the core of this entire ecosystem that you've built.
• 35:06
  SPEAKER_02: Yeah, uh so exactly that.
• 35:08
  SPEAKER_02: So again, Coca-Cola ain't worth the label it's printed on if it would taste different every time, right?
• 35:14
  SPEAKER_02: Yeah.
• 35:14
  SPEAKER_02: And uh or if you couldn't trust it to be, you know, not contaminated.
• 35:18
  SPEAKER_02: I mean, uh whole side so side story.
• 35:21
  SPEAKER_02: But I I used to I grew up grew up with with the son of the CEO of Coca-Cola Africa, and and you know, people chose coke in towns where they were not familiar with it because it was more trusted than drinking the tap water.
• 35:33
  SPEAKER_02: Uh so so um so it's only you have to have consistency.
• 35:38
  SPEAKER_02: We're in the sector of hospitality that doesn't have standards.
• 35:42
  SPEAKER_02: So we have the responsibility as a brand to really be stringent about creating our own standards.
• 35:47
  SPEAKER_02: Now, what's the hard part about a hospitality standard uh or hospitality companies or hospitality operators or brand standard is the fact that you've got a lot of legacy as well to your product inherently.
• 36:00
  SPEAKER_02: You know, we've got 48 or 49 live properties across Europe.
• 36:04
  SPEAKER_02: You know, the way we thought of things six years ago is very different and a lot less professional than it is today.
• 36:10
  SPEAKER_02: Um, we've we've managed to keep it particularly, but you know, we're happy with the consistency considering the massive growth that we've gone through.
• 36:18
  SPEAKER_02: And we have we're more flexible than your average hotel operator in terms of the standards, uh, but we have a lot of consistency uh in it, and certainly I would say just about the most consistent player in our markets.
• 36:34
  SPEAKER_02: But surprisingly, and we didn't really maybe see it this way.
• 36:38
  SPEAKER_02: Of course, we had high aspirations for the tech, but the tech really brings a surprising layer of consistency as perceived by the guests.
• 36:48
  SPEAKER_02: Now, why?
• 36:50
  SPEAKER_02: Well, first of all, you know, you know that when you arrive with a Bob, you have trust you're gonna get in through the door, whether it's 2 a.m.
• 36:57
  SPEAKER_02: or 11 p.m.
• 36:59
  SPEAKER_02: The entry experience is always the same.
• 37:01
  SPEAKER_02: The lock systems work always the same.
• 37:03
  SPEAKER_02: The check-in has been done once, so there's more trust already saying, Oh, Adam, hey, nice to see you again.
• 37:08
  SPEAKER_02: Looking forward to see you staying in London in two weeks.
• 37:11
  SPEAKER_02: That already brings trust that you, you know, hey, this technology, these guys know who I am.
• 37:15
  SPEAKER_02: Then that combined with how breakfast works, how gyms work, which is by the way, extremely simple, which is a big part of user experiences, actually, just to make things work, be simple.
• 37:26
  SPEAKER_02: And uh, and then there's always, you know, always access to the same extras from the pantries to the to the uh early check-ins, late checkouts, which we're the first one to bring into the market.
• 37:36
  SPEAKER_02: So you can get in at 6 a.m.
• 37:38
  SPEAKER_02: in the morning if it's feasibly uh possible, and we can promise it already in most cases, months in advance.
• 37:45
  SPEAKER_02: Um uh because we can we we we drive the the from algorithmically and and machine learning, so we can we can decipher that.
• 37:53
  SPEAKER_02: So actually, this lay, and then it's got you know, Bob is always there for you through that technology layer.
• 38:00
  SPEAKER_02: So that particularly builds that trust.
• 38:02
  SPEAKER_02: Bob answers your message in less than two minutes, he's always there for you.
• 38:05
  SPEAKER_02: So you never feel like, oh, this is alone, some cold hotel where I gotta call a customer service number that maybe somebody will answer, and then I gotta tell them my booking code.
• 38:16
  SPEAKER_02: You call Bob, he knows who you are.
• 38:18
  SPEAKER_02: We've got all that tied in.
• 38:19
  SPEAKER_02: We almost never ever do not know who you are when you message or call, uh, unless you you picked up your wife's phone number and it's not listed, or picks up your wife's phone.
• 38:28
  SPEAKER_02: So all of this, surprisingly, this brings, even with the slight, slack, slight inconsistency of our older portfolio, from the customer's perspective, it brings that consistency and trust of what you're getting.
• 38:44
  SPEAKER_02: Um and I I believe it's a big part of our high NPS and public rating score, and the fact that customers are so trigger-happy to return is that the trust that they know it's gonna work and it works like ABC.
• 39:01
  SPEAKER_01: Wow.
• 39:02
  SPEAKER_01: Uh okay, so you mentioned something important here, which is the idea of legacy and how you did things uh six years ago is different than how you do things now.
• 39:13
  SPEAKER_01: And what I'm drawn to think about here is the idea of business processes, of which uh technology is a business process.
• 39:23
  SPEAKER_01: And uh one of the things that I see is a lot of legacy hotel brands, not Bob W, but other ones, get mired down in that they don't make decisions fast enough about technology in order to enable technology to enable the automation and the seamless uh guest experience.
• 39:43
  SPEAKER_01: So I'm wondering if you could detail uh not only the technology as intellectual property and a brand value for Bob W, but what other uh softer uh innovations have you made uh for your business processes so that way as you as you add more Bob W's, all your legacy properties are all brought up and the rising tide lifts all ships.
• 40:08
  SPEAKER_02: Yeah, yeah.
• 40:09
  SPEAKER_02: The opportunity and the challenge for in the hospitality space has been in the last 15 years, like for every segment is technology.
• 40:19
  SPEAKER_02: Um but if you're just have a static brand that does things statically, it's very hard to reopen that book and then say, okay, well, we're gonna start doing things differently.
• 40:30
  SPEAKER_02: So for Bob W, it was always that next product is gonna be better than this one.
• 40:36
  SPEAKER_02: Obviously, tech keeps chucking along constantly, and then even the physical product.
• 40:42
  SPEAKER_02: I mean, our brand standards have I don't think they've stayed static for a single property, they're always improving, always altering, taking the learnings in um uh for for the next property, which is really this sort of tech world, like let's think iteratively process, which has even more value in the physical product because you're stuck with this stuff for 20 years, so you better make the damn learnings for the next building because you're stuck with those decisions for 20 years.
• 41:07
  SPEAKER_02: And if you were too lazy to make the learnings, well, you got another building with with the wrong kind of legacy, yeah.
• 41:15
  SPEAKER_02: Um, so so uh for us, the backdrop has always been is we keep improving things, and of course, when we started, uh you know, a couple of those uh innovations was the fact that you know, like the front desk getting rid of it thing, that was not obvious from the get-go.
• 41:34
  SPEAKER_02: I mean, when we started in 2019, that was not obvious.
• 41:38
  SPEAKER_02: And the challenge is that you have hotel brands who kind of give this option, but they're scared to even offer it to their guests, where we're like, we're just not gonna offer front desk.
• 41:49
  SPEAKER_02: We're gonna tell you in the email if you don't check in online, you don't get in.
• 41:53
  SPEAKER_02: We love you, but you got to do this because we don't have a front desk.
• 41:56
  SPEAKER_02: Uh, and uh uh so so I think for us, like from a cultural perspective, it's constantly just evolving.
• 42:06
  SPEAKER_02: The status quo product ain't ready today, and as a result of that, we have done these early check-ins, late checkouts, which are algorithmically promised, and we monetize it by the way, and it's pretty good margins because it's 0%, it's just operational efficiency, Tetris games.
• 42:21
  SPEAKER_02: Um, it's it is the check-ins.
• 42:26
  SPEAKER_02: We we also, because we're selling hours in a day, now don't get me wrong, we we're selling you a day, we're not in that kind of business.
• 42:33
  SPEAKER_02: Uh, but uh uh effectively you are trying to you know make maximum use of your time and you got to turn over the property as well.
• 42:42
  SPEAKER_02: So we basically did this whole concept where we don't do a fixed check-in time and a fixed checkout time.
• 42:50
  SPEAKER_02: We ask the guest what time are you coming?
• 42:52
  SPEAKER_02: And your answer can be, dude, I don't know.
• 42:55
  SPEAKER_02: Um and uh and but most people do know when they're coming and when they're leaving.
• 43:00
  SPEAKER_02: We incentivize you to tell that to us.
• 43:04
  SPEAKER_02: Uh and we have self-checkouts, so we have uh two kinds of tech checkouts.
• 43:09
  SPEAKER_02: We have IoT devices in each one of our proper apartments, uh GDPR compliant and all that, um, where we can tell from patterns that you've likely left, or you in the app at right times it asks you, hey, you checked out, please let us know so we can get the place cleaned up.
• 43:26
  SPEAKER_02: So through that, we probably on average two to three hours create extra time, which puts a lot of pressure away from the ops um and and the customer service team, which means that also we can then do better customizations.
• 43:42
  SPEAKER_02: We can have maybe two cleaners working uh, you know, the shifts through a longer period of time as opposed to needing three cleaners during one given time.
• 43:51
  SPEAKER_02: So we kind of again, these were like status quo things, like, you know, yeah, of course people are gonna arrive at three and leave at eleven.
• 43:57
  SPEAKER_02: Like, why?
• 43:58
  SPEAKER_02: Because nobody you They're coming at different times.
• 44:01
  SPEAKER_02: So we started playing that Tetris game and realizing we can get our guests to play that Tetris game, and it all ends up being a lot more efficient and ends up being better outcomes for guests as well.
• 44:14
  SPEAKER_02: So I I think I think there's a cultural aspect at play which has then turned into these sort of just re like not bog bogging down to the legacy of things.
• 44:25
  SPEAKER_02: Now, of course, there's also stuff that the hotel industry does really well.
• 44:29
  SPEAKER_02: And I think first we were allergic to taking best practices that we probably should have taken from the hotel industry.
• 44:35
  SPEAKER_02: And we've slowly learned that uh that path as well.
• 44:38
  SPEAKER_02: Uh, but but really it's a mindset of we're trying to solve a customer problem.
• 44:42
  SPEAKER_02: And as a result of that, I think we've started taking things, you know, a very different approach and done some pretty serious innovations.
• 44:53
  SPEAKER_01: I love that you call it a Tetris game because I I remember my days of basically using the availability calendar and you're dragging and dropping, but everything's sort of locked around these uh, I guess a parallelogram of half day segments where it's 3 p.m.
• 45:10
  SPEAKER_01: till 11 and it's just locked in.
• 45:12
  SPEAKER_01: And you can't actually change the object architecture to be anything on a 24-hour basis where uh it's no longer one night's day as a 24-hour block, uh, 24-hour block.
• 45:24
  SPEAKER_01: It's 24 different segments that are combined to be could to form a room night.
• 45:30
  SPEAKER_01: And just that basic change enables you to ask things like, okay, uh, you know, without plugging into uh a flight data center, just tell us what flight you're arriving on, and we'll sort of rationalize that you're going to be at the property within within an hour and a half uh of that of that landing, right?
• 45:48
  SPEAKER_01: And just something very basic and simple like that then allows you to reconstruct that Tetris and really get much more granular about the check-in and checkouts.
• 45:59
  SPEAKER_02: Yep.
• 45:59
  SPEAKER_02: And and and that again allows for us to have a better experience for you and uh and make sure that when you arrive, you the place is ready.
• 46:09
  SPEAKER_01: Wow.
• 46:10
  SPEAKER_01: Okay, and now all this together, the softer innovations that make you think differently, that allow you to make decisions faster, combine with the technology that allows you to play the Tetris game with much more granularity, all that adds up to a much sharper margin in GOP.
• 46:30
  SPEAKER_01: Um, and can you talk a little bit about the OpEx that uh the OPEX savings that you've realized from all these uh innovations?
• 46:38
  SPEAKER_02: I I can't give you the specific number, but we we have I mean we we can operate uh we basically we can operate a hundred units with uh with two to uh uh uh headcount two.
• 46:52
  SPEAKER_02: And those are of course quite junior.
• 46:55
  SPEAKER_02: We are we treat markets uh like uh like Hotel Street have a GM for a property, we treat we have a GM for a market, sometimes city, sometimes region, because we're able to control that.
• 47:08
  SPEAKER_02: So from a cost perspective, that has pretty massive savings and and uh compared to the averages in in Europe in terms of GOP, we are we are comfortably over double that um uh uh on a European city city hotel context.
• 47:26
  SPEAKER_02: Um we are able to of course not have a customer-facing layer.
• 47:32
  SPEAKER_02: Um we are uh we have a centralized customer service.
• 47:36
  SPEAKER_02: So again, it's a customer service team based out of Estonia, along with uh the tooling in terms of AI and and and other systems, which allows us uh increasingly to have a better experience, but with it doesn't scale the same way as our properties do, or or or that we we see financial benefits out of that.
• 48:00
  SPEAKER_02: Then from a perspective of property operations, because we you know we cleaned once per week, we're able to do it in a lot more optimized way.
• 48:10
  SPEAKER_02: We use we have our own cleaner apps that we use.
• 48:13
  SPEAKER_02: Um we're actually able to run cleaning a lot more efficiently, um, where we're able to see pretty substantial savings.
• 48:23
  SPEAKER_02: That's before we actually go into the fact that we clean once per once per uh week.
• 48:28
  SPEAKER_02: Uh in the average westerner changes their sheets, uh, guess how often?
• 48:35
  SPEAKER_02: Male or female?
• 48:37
  SPEAKER_02: Uh I've just got the average.
• 48:40
  SPEAKER_02: Uh I'd say once every six nights.
• 48:44
  SPEAKER_02: 21 days.
• 48:45
  SPEAKER_02: So so uh so then then uh if we look at uh seven, seven once every seven nights.
• 48:52
  SPEAKER_02: And again, you can always ask Bob for for new linen or or new uh new uh new towels Bob will bring or pantry will bring, but again, there's a question, it's like there's this obsession of hey, we're gonna clean the rooms every day because that's how it's always been and that's how it's always done.
• 49:08
  SPEAKER_02: I mean, at home, people don't clean the room or change the sheets every day either.
• 49:13
  SPEAKER_02: So why does that from a pragmatic approach, why does that need to happen?
• 49:17
  SPEAKER_02: Now, of course, if it's a special family holiday and you're in a resort, then maybe you maybe that that's important to you, and that's great, and you can do that through our app by booking additional cleanings or what have you.
• 49:27
  SPEAKER_02: Um and they're they're all decently priced.
• 49:30
  SPEAKER_02: But that's again an example of how we are able to um just rethink the model and as a result bring in the savings.
• 49:38
  SPEAKER_02: And that means also that we can go into real estate that's not as competitively bidded for, which means that again we can drive better margins through from that perspective and drive a lot of efficiencies.
• 49:50
  SPEAKER_02: Uh so um, and of course, technologies throughout the company, so you know, whether that's uh whether that's uh real estate underwriting or or uh or or finance or what have you.
• 50:03
  SPEAKER_02: So just if you're very switched on to the newest technologies um and that's your that's your modus operandi, you can just drive a team very efficiently.
• 50:12
  SPEAKER_02: And that's you know, we're we're we're we're profitable despite you know growing almost doubling our size last year.
• 50:20
  SPEAKER_02: Wow.
• 50:21
  SPEAKER_01: So let's talk about one more brand advantage, and it relates back to NPS, but also perhaps there's something that ties in to technology here, which is the idea of sustainability as a as a core brand pillar uh to develop that trust.
• 50:38
  SPEAKER_01: Can you talk about what you do to ensure that sustainability is part of the brand DNA and how you really you really push that out from a marketing perspective?
• 50:51
  SPEAKER_02: Yeah, uh it's uh it's a subject close to heart.
• 50:56
  SPEAKER_02: I think the background story is you know, me and Sebastian, the other co-founder, as regular consumers, were had our own journeys of getting worried about like, man, we're really screwing over this planet and uh you know, uh, and tried to make better decisions.
• 51:11
  SPEAKER_02: And then when we started this uh uh you know, Bob W, we were like, oh man, we're buying 40 couches.
• 51:18
  SPEAKER_02: Uh we should probably buy couches that aren't going to screw up the ecosystem less, or the ones that screw it up less than more.
• 51:26
  SPEAKER_02: And uh, hey, we're buying electrical contracts.
• 51:29
  SPEAKER_02: Uh, should we buy the renewable one instead?
• 51:31
  SPEAKER_02: It's 10% more, but you know, it'll probably be the right thing to do.
• 51:34
  SPEAKER_02: And we started realizing that as a business, particularly an operating business, you've got a lot of responsibility.
• 51:41
  SPEAKER_02: And obviously, that put us on a journey of just like a very pragmatic approach to everything that we do, and that's in the corporate culture of just you know making the right choices, and that's down to you know, we we have a target of two pieces of used furniture per every property, you know, we want to support circular economy.
• 51:59
  SPEAKER_02: Plus, by the way, it tails a better story when you've got nice vintage stuff than new things.
• 52:03
  SPEAKER_02: Yeah, uh, it's a pain in the ass, let's be real.
• 52:07
  SPEAKER_02: But uh, so we've taken this from step by step.
• 52:10
  SPEAKER_02: So we've got everything from recycling to renewable electricity on all the properties.
• 52:14
  SPEAKER_02: Um, uh and we've got uh over 30 plus initiatives at the property um or or in our in our organizations that have been active from the get-go.
• 52:24
  SPEAKER_02: But actually, the biggest thing is, you know, um the consumers, particularly the younger generation, again, that emerging generation of traveler, um you know, they're tired of the greenwashing BS.
• 52:40
  SPEAKER_02: They see past it.
• 52:41
  SPEAKER_02: They've heard this, they've heard the slogans, they've you know, they've they've heard the adjectives, and you know, they want facts and they deserve facts.
• 52:52
  SPEAKER_02: And for us, it was like, oh man, like like you know, let's put all the facts on the table.
• 52:58
  SPEAKER_02: So we actually publicize all of our emissions, uh, we down to each apartment type, not just the building, but down to each apartment type.
• 53:08
  SPEAKER_02: So you can make apples to apples comparison of that studio versus that two-bedroom versus that other studio in the other building.
• 53:14
  SPEAKER_02: Why?
• 53:15
  SPEAKER_02: Because if you care about calories and I give you two chocolate bars, all identical, but the other one's 80 calories and the other one's 200 calories, you're gonna pick the 80 calorie one.
• 53:25
  SPEAKER_02: Now, you can't make that educated decision on sustainability in in uh when you're picking hospitality choices.
• 53:33
  SPEAKER_02: Um, so as a result of that, you know, we want to look, you know, we're gonna we're gonna put this front, we're gonna be the most honest.
• 53:40
  SPEAKER_02: This we said this in 2020, we're gonna be the most honest player in hospitality, warts and all, as Oliver Cromwell uh in Britain once put it.
• 53:49
  SPEAKER_02: Um and uh and that's that's to say that we're gonna show what we're good at, what we're bad at, what we figured out, what we haven't.
• 53:57
  SPEAKER_02: And uh uh so we've been publishing the numbers since 2021 and offsetting the stay, which we became the first uh international climate neutral hospitality operator.
• 54:07
  SPEAKER_02: Now uh it's uh climate neutral is probably uh a term that's going away and probably should be going away as we learn more, because you're still paying for your sins, but you're paying for the offset.
• 54:18
  SPEAKER_02: So let's let's say it how it is.
• 54:20
  SPEAKER_02: It's paying for your sins, but also offset.
• 54:22
  SPEAKER_02: So ours again, so you asked your to your initial question is to be the most honest player in hospitality, show the numbers, which by the way, then then the the standards that we're using across the industry ain't given the full picture.
• 54:37
  SPEAKER_02: Um and as a result of that, we actually created our own standard, which which uh which which we have we uh which it we call the uh legit standard, which actually incorporates scope two, scope three, etc.
• 54:52
  SPEAKER_02: And the full uh you know emissions of a pro of a hospitality operator, not just the cherry-picked ones.
• 55:00
  SPEAKER_02: Now, if we use this cherry-picked standard, which is which is very much used in the industry, um it's uh uh we are on per unit four times less emissions um than an average hotel um in the Western world.
• 55:17
  SPEAKER_02: So we are a very efficient operator from that perspective, but that doesn't give a full picture, and that's why we are advocating this push for it.
• 55:26
  SPEAKER_02: And so I think our consumers really appreciate that we are giving them the facts, even though you could say, well, hey, I don't know if this is less or more than that Hilton down the road or what have you.
• 55:39
  SPEAKER_02: But somebody's got to show the way, and we're really advocating the industry to start following suit that we come up with a per night metric, an apples to apples metric that we can share.
• 55:50
  SPEAKER_02: Because nobody's perfect, including us.
• 55:52
  SPEAKER_02: And this is one race that uh, you know, we all want to win, and and we hope that our competitive advantage diminishes and we all hit net zero.
• 56:01
  SPEAKER_02: So I think, you know, there's particularly, I think there's more skepticism in the states towards it, but if you look at the data, it's clear, and you see this from recent SKIF reports is the younger generation is willing to dish out cash to stay its credibly sustainable options, and they want the facts.
• 56:20
  SPEAKER_02: So we can, as an industry, either, you know, as a hospitality industry, go head first and and be pragmatic, self-regulate, you know, help get that uh uh the facts out there and make it a positive race to the bottom, or lose that trust and risk being the next flight shaming kind of you know uh uh you know that's that's the other side of the ball.
• 56:46
  SPEAKER_02: So so we we want to encourage all sorts of hospitality apps.
• 56:49
  SPEAKER_02: We're more than happy to help out.
• 56:52
  SPEAKER_02: Uh, we can also suggest different uh consultants to use, what have you.
• 56:56
  SPEAKER_02: The the only way you're gonna improve your emissions is to measure it first.
• 57:00
  SPEAKER_02: Then you know if you've your lever is moving.
• 57:03
  SPEAKER_02: Before that, it's all just here saying fancy adjectives.
• 57:05
  SPEAKER_02: So that's that's our approach to it.
• 57:07
  SPEAKER_02: And I think the customers have really, really appreciated that.
• 57:10
  SPEAKER_02: Uh which I think we did it to sleep our nights better, but it really turns out that it's it's an it's uh it, you know, the brand loyalty is through the roof.
• 57:20
  SPEAKER_02: I think big part thanks to that.
• 57:23
  SPEAKER_01: Yeah, you know, I love that you you mentioned that you have to measure it first off, which draws us back to the technology in terms of uh, you know, water submeters, and then if you're in the rooms you have passive infrared to have a shutoff for when people check out uh and and other things.
• 57:42
  SPEAKER_01: But then part of that measurement, I think where a lot of brands might get hold up, and this is part of your your IP, is then taking all those measurements and computing them all into a centralized energy management system.
• 57:56
  SPEAKER_01: So have you set that up as part of your intellectual property to have all that all those measurements come in for some form of unified reporting?
• 58:07
  SPEAKER_02: I think data is an interesting thing that goes beyond not just uh being able to run the properties more efficiently, but it's also actually a way to know more of your customer and then being able to tie that into the profiles and then in our case automate that customization uh back.
• 58:26
  SPEAKER_02: But that's slightly a different story.
• 58:28
  SPEAKER_02: The the other the other part from a data perspective, we have um we have IoT devices in every property, which is humidity, temperature, um uh Bluetooth, count, movement, uh decibels.
• 58:46
  SPEAKER_02: Um so we use it for a variety of things.
• 58:50
  SPEAKER_02: We call it the our autonomous hospitality.
• 58:54
  SPEAKER_02: So, again, how do we create hospitality that feels warm and empathetic and there for you, but it's actually autonomous?
• 59:01
  SPEAKER_02: Uh, so that allows us to be in control of the property remotely.
• 59:06
  SPEAKER_02: Um and in in in some instances, in many instances, we can tie that into the building systems, which we're now doing more and more with our landlords, um where you're able to actually you're able to actually drive the uh understand where the the energy what is driving energy usage, what is uh when is it occupied, when it's not occupied, etc.
• 59:34
  SPEAKER_02: So that you can run the building efficiently, which also does translate to the less emissions, plus of course, uh you know, less costs, which often go hand in hand.
• 59:44
  SPEAKER_02: Uh so we, for example, in our Helsinki city center property, uh run on remote-controlled uh um uh optimization of heating, cooling based on occupancy, uh, based on long-term occupancy.
• 1:00:02
  SPEAKER_02: So basically we can tell if the apartment's gonna be uh closed for another two days as of now, we'll let it go, uh, we'll slow down the cooling or the heating even further.
• 1:00:12
  SPEAKER_02: Um, and we're able to bring about an 11% reduction um on uh on the the heating and cooling and energy costs uh to the property, which is something that uh you know we we are working to develop further, but it's something that we you know we see a lot of opportunities in.
• 1:00:33
  SPEAKER_02: But one thing which is clear from an operator perspective is the best, most long-term sustained way of reducing your emissions is to be able to operate very efficient properties.
• 1:00:48
  SPEAKER_02: And I think sometimes us as operators wash our hands, well, hey, we're stuck with this, and so be it.
• 1:00:52
  SPEAKER_02: And that's why we work on all these different fronts.
• 1:00:55
  SPEAKER_02: But those efficiencies, man, they are just incredibly important.
• 1:01:00
  SPEAKER_02: And that's why we work with some of the biggest landlords across Europe and and the globe uh who share this view that in the long term it brings their you know uh value to their asset if they're you know choosing lead or BREAM standard or passive house or one of the other uh you know high-quality, um high-quality um certifications that can help us operate more efficiently, but actually have a have a lesser impact on the environment.
• 1:01:29
  SPEAKER_01: Yeah, and and I love that you're treating it as an ongoing process.
• 1:01:32
  SPEAKER_01: So you have those that 11% savings, and now you keep saying we can do better, we can do better.
• 1:01:38
  SPEAKER_01: Well, how do you do that?
• 1:01:40
  SPEAKER_01: Well, it's it's a business process, you're tackling it, and you know, where you have a series of quick wins that are all 1% improvements, but you string enough of those together, and now you have something that is a serious draw for the next generation of consumers that really does care about the environment.
• 1:01:59
  SPEAKER_01: And you know, I'm I'm filming here in Toronto, we're filming beginning of August.
• 1:02:04
  SPEAKER_01: Uh July in Toronto here was one of the hottest, driest Julys on record.
• 1:02:13
  SPEAKER_01: Meanwhile, in New York City, a week ago, which is a one-hour flight, they had within 24 hours they had flash floods that shut down the city.
• 1:02:23
  SPEAKER_01: This is weird weather where you have normalization that breaks down.
• 1:02:28
  SPEAKER_01: And this is what we're talking about with climate change and eventually that translates into the next generation of flight shame.
• 1:02:36
  SPEAKER_01: And we're trying to prevent that by getting ahead of it, by being climate neutral, however bad a term or greenwashing a term is for that, but getting ahead of it any which way we can.
• 1:02:47
  SPEAKER_01: So I I really love that, and I really see that as a huge advantage going forward for literally the next 30 years as we're tackling this problem.
• 1:02:55
  SPEAKER_02: Yeah, and I think I think here the if we look at the the hybrid hospitality operators who benefit from not having the legacy of the big hotel chains, um we've got an opportunity to differentiate the heck out of ourselves.
• 1:03:10
  SPEAKER_02: So so like again, I look, I'm I'm I'm I'm all for capitalistic views, and I I think you know, we it needs things need to be viable business decisions.
• 1:03:22
  SPEAKER_02: But you know, to me and to us, it's been clear for a while that this is a great business decision.
• 1:03:28
  SPEAKER_02: So that's always good to keep in mind.
• 1:03:30
  SPEAKER_02: So don't don't just do it to sleep your nights better.
• 1:03:33
  SPEAKER_02: I mean, do it with a you know, with with a financial long-term business gains in mind, because there is a business case for that already today.
• 1:03:44
  SPEAKER_01: Wow.
• 1:03:44
  SPEAKER_01: And you know, being forward-looking, um, now we can segue to the future.
• 1:03:50
  SPEAKER_01: So what does the future hold for Bob W?
• 1:03:52
  SPEAKER_01: What's on the forefront?
• 1:03:53
  SPEAKER_01: Expansions, new features, interesting micro-segments that uh that you want to attract?
• 1:04:00
  SPEAKER_02: Yeah, so what does the future hold?
• 1:04:03
  SPEAKER_02: Um I mean, we're gonna continue to grow.
• 1:04:06
  SPEAKER_02: This is a massive mom and pop fragmented space, and there's room for the next Hilton's and the next Marriott's.
• 1:04:16
  SPEAKER_02: And uh, we our company's vision is to be the most loved hospitality brand for the next generation of travelers.
• 1:04:23
  SPEAKER_02: And so for that, we want the geographic coverage, we want depth, we want increasing commercial liability, we want to be the household name that Adam, should we grab a hotel or an Airbnb or a Bob?
• 1:04:37
  SPEAKER_02: And Bob represents that you know what you get.
• 1:04:40
  SPEAKER_02: Next generation standard for the short stay rental space for that next generation of traveler that's not looking for a hotel.
• 1:04:47
  SPEAKER_02: And uh so so in in the short and medium term, it's it's growing.
• 1:04:54
  SPEAKER_02: So, I mean, just we just last month opened two properties in Stockholm, capital of Sweden.
• 1:05:00
  SPEAKER_02: Um Helsinki, we and uh we announced uh a massive flagship in uh Copenhagen, which is one of the one of the fastest growing markets in Europe.
• 1:05:12
  SPEAKER_02: Uh we will have a pile of announcements coming shortly again across the Europe.
• 1:05:17
  SPEAKER_02: Question is when do we start going beyond Europe?
• 1:05:20
  SPEAKER_02: Uh there's a lot of space here, but of course, uh, you know, we we we have take over the world plans.
• 1:05:27
  SPEAKER_02: Um so so that's that's one area.
• 1:05:30
  SPEAKER_02: And we'll be very happy with the performance uh of in general of the entire portfolio.
• 1:05:35
  SPEAKER_02: Um so that gives us trust that even though there's been some economic headwind, that's not translating into us and uh the price position that we're representing and the value we're bringing.
• 1:05:46
  SPEAKER_02: Uh, we've recruited a bunch of senior uh brass into the company.
• 1:05:51
  SPEAKER_02: So we're gonna, and particularly focusing on southern Europe, Italy, Portugal, Spain, um, and also further beyond as well.
• 1:05:59
  SPEAKER_02: And One one thing which I'm particularly excited about is us continuing to develop uh you know our technologies.
• 1:06:07
  SPEAKER_02: Uh again, I'm gonna use that current hype word uh AI.
• 1:06:11
  SPEAKER_02: There's a lot of opportunity we can uh we you know we can create a better experience for guests, uh get more efficiencies.
• 1:06:21
  SPEAKER_02: And uh and I I fear that the hospitality industry as a whole is quite behind in this space.
• 1:06:27
  SPEAKER_02: Uh, but there's a lot of opportunity there um to capture, and we we certainly our approach is always to be and be an early adopter on that front.
• 1:06:36
  SPEAKER_02: We are not an AI business, let's not fake it either.
• 1:06:39
  SPEAKER_02: But the applications and the benefits are clear as day.
• 1:06:42
  SPEAKER_02: You just got to search for them.
• 1:06:44
  SPEAKER_01: Yeah, it's a it's a tool like any other.
• 1:06:46
  SPEAKER_01: So I I'm wondering, you mentioned expansion into southern Europe and the Mediterranean.
• 1:06:52
  SPEAKER_01: And one trend I'm seeing, and I'm looking ahead now through till 2035, is the growth of uh destinations as uh for retirees and people that want to get in on the on the slow travel life in the Mediterranean that's really made a name for itself as a blue zone, a place that promotes longevity and has uh la dolce vida.
• 1:07:16
  SPEAKER_01: Do you see your stuff?
• 1:07:17
  SPEAKER_01: Do you see Bob W uh accessing that market and that travel niche?
• 1:07:25
  SPEAKER_02: I think we're we're in a very fortunate position that our our brand product and operating model and technology allows us to go to different segments.
• 1:07:35
  SPEAKER_02: I can totally see us having a more student uh proposition, a more luxury proposition, uh, a more managed home proposition as well.
• 1:07:47
  SPEAKER_02: The question is always about focus, and I think inevitably we will get into one or some or all of these segments.
• 1:07:55
  SPEAKER_02: But the question is is how does one keep their focus?
• 1:07:59
  SPEAKER_02: We talked about early in this episode to do one thing, uh do as little things as possible and do it 10 times better than the competition.
• 1:08:06
  SPEAKER_02: Yeah, so so um uh I think there's opportunities there.
• 1:08:14
  SPEAKER_02: Um and uh uh there will be a time when we expand, but now if we can keep our ship tight currently, that's probably a good good place to focus on um as long as as that's feasible.
• 1:08:28
  SPEAKER_01: Yeah.
• 1:08:30
  SPEAKER_01: So Nico, to wrap up your uh is there anything important that we haven't touched upon about Bob W that you want to mention?
• 1:08:39
  SPEAKER_02: Um I think we've I think we've covered most of it.
• 1:08:43
  SPEAKER_02: Would love love the the you know the listeners listeners on this show to give it a try.
• 1:08:49
  SPEAKER_02: And uh uh, you know, we are a big believers in being part of the hospitality community, so feel free to reach out on LinkedIn or or wherever else.
• 1:08:58
  SPEAKER_02: And uh uh if if you've got ideas uh uh for expansion or partnership or anything else, uh we're an open book and would be happy to have that chat.
• 1:09:08
  SPEAKER_01: Awesome.
• 1:09:10
  SPEAKER_01: Nico, thanks so much.
• 1:09:11
  SPEAKER_01: It's been a fantastic conversation.
• 1:09:13
  SPEAKER_01: I love I love hearing about how you're innovating hospitality.
• 1:09:17
  SPEAKER_01: Thank you.
• 1:09:18
  SPEAKER_01: Thank you, Adam.
• 1:09:19
  SPEAKER_01: Thanks for keeping the show.