Sharing economy approach to hotel reservations
Perch Co-founder and CEO Sam Tate took an extended vacation two summers ago after his freshman year of college. It was a “month-long backpacking trip to Europe,” he told PYMNTS in an interview. Tate visited many cities on the excursion, which was also the first trip he had to pay for himself. Due to his limited budget, he has stayed in hostels in various countries and cities and has always had a less than ideal experience. Tate noted that the hostels were messy and noisy – and the bathrooms were dirty.
For a few nights, he splurged in a hotel room, which he remembers as being much nicer, with a big bed and more amenities. But Tate noted that there always seemed to be an empty bed in space. He realized that if he could share the room and share the cost with another person, he could receive all the perks of a hotel at a hostel rate.
When Tate returned to college the following year, he launched the first iteration of the idea: Room Split. It started as a simple online form: users filled in their destinations, the number of travelers in their party, their travel dates, and some info about who they are. After reviewing the information, Tate matched each person with another traveler who was visiting the same destination. The concept was primarily aimed at music festivals and events – places where a lot of younger, open-minded people travel on the same dates. This idea gradually morphed into Roost, which allows consumers to book a hotel and find a roommate.
Travelers start by visiting the Roost site, which displays events and cities. Consumers can enter the number of people traveling and select a hotel category (two-star, three-star, or four-star) such as Hotwire. They can then choose which regions or neighborhoods they feel comfortable staying in and pay for their room with a credit or debit card through Stripe.
Then, users can access a list of all the other people who are going to their target area on the same dates. They can indicate which people they would like to stay with by tagging profiles, like a dating site. When a mutual connection is established, 50 percent of the traveller’s payment is refunded. If a roommate is not found, the user pays the full price of the room. Travelers have up to three days before check-in to match with someone else.
During registration, users are guest to create a Roost account and roommate profile and verify their accounts, which includes uploading a photo of their government-issued ID and passing a background check. Their profiles will display a blue check mark when verified.
The company’s target market includes Generation Z and Generation Y. The company offers accommodations in markets such as New York, San Francisco, Nashville, New Orleans, Chicago and Orlando.
Tate said Roost looks for “very densely populated places” where hotel rooms can get very expensive, increasing the chances of saving money. The company also offers accommodations for travelers enjoying events such as EDC Las Vegas, Ultra Music Festival, and Hangout Music Festival, among others. To promote the platform, Roost works with influencers in the festival space.
Beyond hotel rooms, the company is rolling out a ‘List Your Stay’ feature that will allow consumers to fill empty beds in their hotel rooms or vacation rentals, even if they haven’t used Roost to book their accommodation, as the platform aims to make travel more affordable and accessible.