Abode (Co-founder Tobin Watkinson, Columbia General Studies) creates a hospitality experience that resonates with guests by merging the best attributes of home-sharing and hotels. Bootstrapped to $6mil ARR.
Tobin Watkinson will pitch Abode in the FIRST annual CVC London Demo “Night” at 2 PM EST on Wednesday, October 21st. Abode will be one of six teams to pitch.
The all-virtual nature allowed more teams to apply from anywhere and will also allow a larger group of attendees. While we miss the in-person events, we are excited to host all of you that might not have been able to travel to these cities. Remember to RSVP!
Tobin is a part-time student, pursuing his BA at Columbia. He is also the co-founder of Abode — a growth-stage hospitality startup — marrying his professional life with his academic goals, which include going on to business school part-time after graduating from Columbia. After a long stint in Los Angeles working in the music industry and tech, he and his wife started Abode.
“Professionally, I have a passion for entrepreneurship and business building. My business experience resides in media, music, tech and hospitality. I have helped to grow companies leading to exits, and advised platinum recording artists, creative agencies, and global brands.”
What inspired you to create Abode?
I have always been in entrepreneurial roles and worked with innovative organizations. We were excited about the opportunity to build a business and brand in a burgeoning blue ocean, disrupting a substantial addressable market, the traditional hotel.
It was clear that guests enjoyed Airbnb's whole-home aspect, but wanted a more closely curated and professionally managed experience.
Not only did the business quickly reach profitability, but we were able to grow same-store RevPar by double digits year over year, which allowed us to grow from our balance sheet with modest amounts of debt, which we quickly paid off.
Being debt free and profitable placed us in a unique position in contrast to many of our competitors coming into Covid-19.
The pandemic has increased consumer awareness and appetite for touchless check-in and larger whole-homes, like those offered by Abode.
We've seen a sea change in how people travel and what matters to consumers. Changes in school and work modality have allowed individuals and families to consider rethinking how they travel.
The average week-long vacation is being supplanted by more extended stays historically more synonymous with the "digital nomad" or travel influencer.
We're well suited to capture this opportunity. We plan to significantly grow the business over the next three to five years to expand the alternative accommodations market.
We believe we can carve out a niche as a design-forward, experience-driven alternative accommodation provider and continue to build a stable and profitable business as a long-term opportunity.
What brought your team together?
My wife, Alex, who leads our design and experience initiatives, founded Abode with my part-time support during the proof of concept.
What started as a passion project budding from her love of hospitality soon was recognized as a growing opportunity in alternative accommodations during the business segment's infancy.
My role at Flipagram came to an end, TikTok's parent company ByteDance acquired the company, and it felt like the right time to join her in exploring the venture full-time.
Alex's talent and passion for design and experience complemented by my experience building businesses and leveraging technology to automate processes - an area where hotels and short-term rental hosts struggled - led us to find product-market fit and the ability to scale profitably.
We began growing at an accelerated pace and brought on our COO, Jay Harbison, to capitalize on an opportunity to bring on our first standalone apartment hotel and to harness his hospitality operations experience to assist us in continuing to expand the business.
Our core team exhibits complementary skill sets that have allowed us to maintain a lean organization while taking a measured and profitable growth approach.
How have you tackled the challenges presented by the pandemic and what has that growing process been like for your team?
Abode has operated in a remote capacity with a small administrative infrastructure footprint since the initial stages.
Thus, we have not had to alter the way we work significantly.
We had a leg up on competitors that were scrambling to enable their employees to telecommute while also tackling falling revenues.
As a direct response to the pandemic, we've increased our distribution and length of stay minimums to target guests that would find value in our offering vs. a hotel (kitchens, ability to better social distance, touchless check-ins, etc.)
We also began targeting traveling medical professionals.
Additionally, we offered risk-free cancellations as we found most guests were booking in a close booking window. We also implemented a significant length of stay discount. We have targeted occupancy as our focus ahead of ADR.
We transitioned to a representative inventory approach with major online travel agencies (Booking.com, Expedia, and others). We also began marketing on sites geared toward the residential multifamily or corporate housing markets to elicit occupancy potential more efficiently.
We have updated our residential cleaning protocols and improved communications to address new customers in our segment from an operational standpoint.
Still, we have otherwise not had to alter the way we operate as an organization significantly. Thankfully, we were already incredibly lean and have made further internal reductions and worked with our external partners to lower both general and administrative expenses and cost of sales to make this approach less impactful on our runway.
Late last year, we decided to begin focusing on partnering with landlords in a shared success model. We started reducing our arbitrage exposure while increasing our unit count by roughly 60% and achieving a double-digit EBITDA without taking on any additional debt.
“We have grown the business in a measured manner relying on cash flow to fund the business's operations and expansion.”
We have been successful in maintaining positive cash flow since the company's inception. This approach has also allowed us to survive the pandemic, where many of our larger competitors have not.
How would you advise other founders based on abode’s experiences?
We built Abode very differently from your average startup.
We've been in business for over five years and have been EBITDA positive while growing from a single US market to ten and increasing revenues by 250% in the trailing three years (2016 - 2019).
“Abode achieved this because our team put a tremendous amount of focus on finding product-market fit and focusing on profitability, in part by choosing to headquarter outside of SF or NY and building a remote working environment.”
We've learned to solve problems, where if you had money, money would be the solution.
This method isn't for everyone, but I believe profitability is critical in this day and age. The basics still apply, however.
Find a large addressable market, ensure your product connects with consumers, and that you can make the economics work.
Build a key executive or support team in the organization's early stages with a shared vision, complementary skills, and experience, who work well together under pressure.
How has your unique building process been advantages?
Abode is a design-forward, and experience-driven hospitality product carefully curated to meet the traveler's needs.
We rely heavily on technology to create a superior guest experience, manage risk, and improve the back-end processes such as operations and supply chain -- all while lowering cost vs. the traditional hotel.
We have been in the segment longer than our national competitors. We have determined what does and does not work through our shared experience.
We have not had the luxury of a padded bank account to make big mistakes, so we have become incredibly agile.
Abode's advantages include experience, technology, design aesthetics, tested products and processes, and being nimble as our market evolves.
What city are you based out of?
Abode has offices in Nashville, TN and Los Angeles, CA. I am based in Nashville, TN.
Thank you Tobin! We look forward to hearing you pitch on October 21th. Don’t forget to RSVP!