Retail

Taking A Sharing Economy Approach To Hotel Booking

Sharing Economy Approach To Hotel Booking

Roost Co-founder and CEO Sam Tate went on an extended vacation two summers ago after his junior year of college. It was a “month-long solo 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 on his own. Due to his limited budget, he stayed in hostels in various countries and cities, and had a consistently less-than-ideal experience. Tate noted that the hostels were messy and loud – and the bathrooms were unclean.

For a couple of nights, he splurged on a hotel room, which he recalls as being much nicer, with a big bed and more amenities. But Tate noted that there always seemed to be an empty bed in the space. He realized that if he could share the room and split the cost with one other person, he could receive all of the perks of a hotel at a hostel rate.

When Tate returned to college the next year, he launched the first iteration of the idea: Room Split. It started as a simple online form: Users would fill out their destinations, the number of travelers in their group, their dates of travel and a bit of information on what they are like. After reviewing the information, Tate would pair each person with another traveler who was visiting the same destination. The concept was mainly for music festivals and events – places where lots of younger, open-minded people are traveling on the same dates. That idea gradually morphed into Roost, which allows consumers to book a hotel and find a roommate.

The Platform

Travelers start by visiting the Roost site, which displays events and cities. Consumers can enter how many people are traveling and select a category of hotel (two-star, three-star or four-star) like Hotwire. They can then choose the regions or neighborhoods in which they are comfortable staying, and pay for their room with a credit or debit card via Stripe.

Next, 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 want to stay with by tagging profiles, similar to a dating website. When a mutual match is made, 50 percent of the traveler’s payment is refunded to them. If a roommate is not found, the user pays the full room price. Travelers have until three days before check-in to be paired with someone else.

When signing up, users are prompted to create a Roost account and roommate profile and to verify their accounts, which includes uploading a photo of their government-issued ID and passing a background check. Their profiles will display a blue checkmark once they are verified.

The company’s target market includes Gen Z and millennials. The company offers rooms in markets like New York, San Francisco, Nashville, New Orleans, Chicago and Orlando.

Tate said that Roost looks for “very densely populated places” where hotel rooms can get very expensive, increasing the chance for savings. The company also offers rooms for travelers enjoying events like EDC Las Vegas, Ultra Music Festival and Hangout Music Festival, among others. To get the word out about the platform, Roost works with some 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 didn’t use Roost to book their accommodations, as the platform aims to make travel more affordable and accessible.

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PYMNTS LIVE VIRTUAL PANEL: WHY SWIFT GPI IS JUST THE BEGINNING 

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