STR Global Unlocked with Simon Lehmann: Unfiltered knowledge for the short term rental industry

032: How HomeToGo Shifted Beyond Its Marketplace | Dr. Patrick Andrae

• Powered by AJL Atelier • Season 1 • Episode 32

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0:00 | 52:14

Marketplaces were built to aggregate supply. Not to own it. That assumption is breaking faster than most operators expected.

Dr. Patrick Andrae is the Co-Founder and CEO of HomeToGo, one of the world’s leading vacation rental marketplaces, aggregating millions of listings across platforms and property managers. Since founding the company, he has expanded it into software, services, and property management, including the acquisition of Interhome, one of Europe’s largest rental operators. The combined group generates nearly $400 million in revenue, with more than 60% coming from its B2B segment, and over 200,000 properties connected through software and services.

This is not a conversation about marketplace growth. It is a breakdown of what changes when platforms move closer to supply, and how that reshapes control, margins, and competitive advantage.

In this conversation, we discuss:

  • Why owning supply is no longer seen as a margin tradeoff, and what changes when platforms move closer to operations and the last mile
  • How HomeToGo’s shift from marketplace to B2B changes where value is captured, and why that redefines the role of distribution platforms
  • What most operators underestimate about direct bookings, and why having traffic does not translate into control without conversion infrastructure
  • How AI is changing travel discovery behavior, and why vacation rentals present a fundamentally harder decision layer than flights or hotels
  • Why Europe’s fragmented supply remains largely unconsolidated, and what that reveals about the limits of traditional marketplace-driven growth
  • What changes when a company operates across marketplace, software, and services, and how that creates optionality in uncertain distribution environments

Resources and links:

Connect with Dr. Patrick Andrae on LinkedIn and learn more about HomeToGo.

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SPEAKER_00

We started home to go because we saw that the vacation rental market to a certain extent was broken. Very fragmented, to a certain extent, also unprofessional.

SPEAKER_02

Does AI reinforce the large platforms or does it create opportunities for the operators to regain control?

SPEAKER_00

Potentially in a world where all like mid layers of marketplaces or OTAs wouldn't exist anymore. It would be like something where you need someone that has the direct access or the last mile.

SPEAKER_02

Why has a direct booking remained so difficult to achieve?

SPEAKER_00

The problem is simply a front end is not a front end. You can build a copy of a front end of Home2Go. You won't have the same conversion because you don't know the underlying topics that we tested now over more than 12 years and on scale. For instance, in the German market, where you look, we probably are after booking number two. Because we're definitely sometimes bigger than Airbnb and also than Verbo.

SPEAKER_02

You are listening to STR Global Unlocked, brought to you by AJL Optelier, the show where I speak with the leaders shaping short-term rentals worldwide. I am Simon Lehman, and after two decades buying, selling, advising, and investing, I've built a network that spans continents and categories. This podcast brings that network to you. Real conversations, global insight, no PR fluff. Let's get started. Home2Go just reported its latest results. The strategy is evolving because this is no longer just about being a marketplace. With the integration of Intrahome, Home2Go is moving deeper into supply, operations, and economics. And that raises a bigger question. Are we entering a phase where distribution platforms start to own more of the value chain again? Or is it simply the next step in making fragmented supply more controllable? Today I'm joined by Patrick Andre, co-founder and CEO of Home2Go. Home2Go has built one of the leading global marketplaces for vacation rentals, aggregating millions of listings across platforms and property managers. But more recently, the company has taken a strategic step deeper into the value chain with the acquisition and integration of Interhome, one of the former Europeans' most established rental operators. That shift makes this a particularly interesting moment to talk not just about marketplaces, but about where the industry is heading next. Patrick, it's fantastic to have you on the show.

SPEAKER_00

Thank you for having me, Simon.

SPEAKER_02

It's a great pleasure and congratulations on your numbers yesterday. Before we dive into those and many other topics, I would like to start our conversation with a quick rapid fire of all the topics that we are thinking about within the short-term rental industry across the globe, because STR Global Unlocked is the listening base is international, and we have people from Australia, Southeast Asia, Europe, the US, and Latin America. And they would love to hear your thoughts on our rapid fire today. Before we dive in, so let's do this. Short answers, whatever comes to mind, Patrick.

SPEAKER_01

Sure.

SPEAKER_02

Marketplaces, scale game or margin game?

SPEAKER_01

Both.

SPEAKER_02

Direct booking, opportunity or distraction?

SPEAKER_01

Opportunity.

SPEAKER_02

AI and travel, overhyped or underestimated?

SPEAKER_01

Both.

SPEAKER_02

Owning supply, strategic advantage or operational burden? Strategic advantage. And one prediction: what changes most in travel distribution over the next five years?

SPEAKER_00

I think the influence of AI, although it's uncertain, but we will probably touch on that. So not a short answer possible.

SPEAKER_02

Absolutely. And we'll definitely get onto that. Thank you for uh for jumping in on those. So you've just released your latest results from the outside. What's interesting, it's not just the growth, but it's the direction that you're making very clear that was announced yesterday. So maybe starting there, what are the key takeaways from the latest numbers from your perspective?

SPEAKER_00

We published our financial year number for last year for 2025. And as you might have seen, we basically reported on two ways, right? One was this what we call statutory numbers, and the other is pro forma. Why is that? Because as you mentioned in your introduction, we acquired Interhome, Europe's second largest vacation rental management company for Micro last year. And so they were only partially reflected from the day of the closing on, which was at the end of August last year, in our statutory numbers. So what you officially need to publish, and therefore to also guide people on how the combined company really looks, they also showed like performer combined numbers. So is as if Interhome would have been part of Home2Go already from the 1st of January last year to give a sense of size and magnitude of the group. Yeah, and there you can see that the Home2Go group, including Interhome last year, um, did um 394 million in revenues, so almost 400 million in revenues. And um together we did 442 million of adjusted EBITDA. Um, that's as a performer number, as a combined group, is what we did. And we also said that we will um we are aiming what we are aiming for this year, so for financial year 26, as a guidance to the markets. Yeah. And there you can see that we expect more than 400 million, actually 400 to 410 million in revenues and uh 45 to 47 million in adjusted ebada for 26.

SPEAKER_02

Absolutely. So that makes a ton of sense. But more importantly, what you just alluded to, Patrick, and I I sense that. Where is where is home to go heading strategically? I mean, besides the macroeconomical impact that we're having right now and the challenge that we're facing with all the disruption that we're seeing on a global basis, but where is home to go heading strategically as a next step? I mean, Interhome was a pretty massive strategic move, and obviously there is more to come.

SPEAKER_00

I think we started home to go because we we saw that the vacation rental market to a certain extent was broken, very fragmented, to a certain extent, also unprofessional in terms of especially um at tech adoption and these types of things. And we saw it was basically very hard for people to get an overview over the market. So that's why we started home to go in the very first place with the MetaSearch engine. We knew though, and realized also very quickly that actually like the the um the amount um of people or partners on our platform that might still lack the technological abilities when you send them traffic to convert that traffic was something where we where we saw that we can help them if the transaction happens directly on our platform. That's how the home2go meta search evolved to the marketplace that still has this hybrid, what we call today advertising, where you still have partners that we link out to. With that, actually, we saw that if we can help partners that easy on our on our platform, why not also do that outside of the home2go marketplace? And that was where the idea, although the name was there at that time, of Home2Go Pro, what today is our B2B segment, was born. And first we started like utilizing our marketplace technology. So we have a product that's called Home2Go Doppelganger, which is our white label and API solutions, so that third parties that also want vacation rentals can use it. And that's basically what today the TUI is using. It's uh it's used by DereTour. It's recently we we also announced that Amadeus is now using it in their Bistro system, which is very much two operator or and travel agency topics, but you can see that people that want an uh an easy access to this vertical are using our products. And when we saw that this is working, we thought, okay, why not also expanding our offering into topics we are not can direct or we are not directly supplying from the marketplace? That's when we started, while we were going public in 2021 on the German stock exchange in Frankfurt. Shortly before we started acquiring uh uh we acquired Smoobu, which is like many people probably know, a very lean but also very cheap software for basically doing PMS as a host or smaller host with maybe up to 10 properties. We have also people that use it with 100, but it's built for rather smaller um inventory. Nonetheless, this was uh our start, then also like enlarging basically the offering of Home2Go Pro with software, and now we come to services in a second, that are not like part of the initial marketplace offering. And this was actually working very successfully because combined also with our knowledge from from the marketplace and the technology power that we have as a as a big um marketplace, we could build something smooth, faster, and bigger and more robust. And then we enlarged Home2Go Pro over the time to when we went to the stock market. Um, we said until 23, we want to have it like 20%, that Home2Go Pro is 20% of our oil business that we achieved in 23. In um 24, it was already small than 30%, and then last year it was already uh at 35%. Prior, we acquired Interhome, which now adds to software and services, especially the service full property management. And with that, the complete group basically shifted. Prior, roughly one-third was pro, two-thirds was the B2C marketplace, and now it's the other way around that we basically have almost two-thirds being Home2Go Pro, so B2B, including Interhom, and one third is the remaining marketplace. So actually it's 63 and 37%. But just to give that idea, and that obviously shifts also the gravity and the focus of the group to be now a B2B focused and more like the topics around what we do are centered around our B2B offering.

SPEAKER_02

Which obviously had an impact on margin as well. You know, I remember um the first call I had from Brian Sharpers and Carl Shepard in 2006. They called me from Austin and said, Simon, can we acquire Interhome? And um, so I sat down with them and uh they looked at our margins, and and and home away at the time had a 35% gross margin on advertising listings on Home Away, right? And when they realized that Interhome was actually an operational business, cleaning toilets and having local offices and massive overheads and with a with a significant lower margin contribution, they decided, hey, this doesn't make sense. And and said we we continued being a marketplace. And at the time it was only listings, obviously not bookable inventory, et cetera, et cetera. It's a long story. But anyway, you've made that decision very consciously while you said, hey, we can add more value to the B2B business with this acquisition, and then ultimately drive not just margin eventually, but also drive services for your long tail business at the same time.

SPEAKER_00

Yeah, I think the um the the question, what probably is behind that, if I get you right, right, like is why have we done it? Again, why we are not like uh like Home Away. I think like the interesting thing if you look back, right? Homeway for for those that don't know is now VRBO because Expedia decided to utilize the the second brand that Home Away also acquired, right? But the interesting part back then, the Home Away business, from a gross merchant perspective, it probably made sense as long as SEO was that lucrative as a as a topic. But if you looked at it from a margin in terms of take rate perspective, or commission, however you want to call it, there were always these rumors that with the listing, they roughly do 3%, maybe 4% or something like this on the actual GBV, so the gross booking value, if you would translate it into a commission or take rate. So that's when they realized when Airbnb and booking came to came into the market that you can have a higher margin. And fast forward today, VRBO also mostly runs on commission. And there obviously commission is much nearer to the model that an interhome was running, though you are deeper in the value chain, which means you also have more margin, from which, as you rightly alluded to, right, like you have to pay also more services parts. But in the end, it's not so different because you simply have a different starting level. And uh, in the end, you want to look what's left once you have all your costs, right? So, like that's probably also a little bit the the reason why back then listing and um I wouldn't call it free ride, but obviously like having uh free uh a lot of free SEO traffic was was really a good uh thing back then for Homeware Burble.

SPEAKER_02

Yeah, I mean that was the investment rationale. I never forget that calculation when Brian was standing in my office and said, Simon, we can just get rid of all your marketing costs and we just drive your demand, and then we can push your margin another 15%. So in a nutshell of the back of the envelope or the Rafan and Biotech, that's the conversation that we had. Ultimately, that was obviously the margin has shifted, the marketplaces have shifted, cost of distribution has shifted, uh, many things have shifted. But let's quickly, before we move on, let's last question about the interim integration. I mean, at the end of the day, it's a it's an asset, it's a it's a different business. It's ops heavy, it's not a marketplace. Uh so compared to your business, it's asset heavy even more, um, much closer to the actual guest experience. So that must have been definitely so the rationale behind it you already alluded to, but that integration from a home-to-go DNA was definitely not an easy one.

SPEAKER_00

And to be fair, right, we started the integration end of August last year. So basically in September, right? We are just like roughly half a year in, yeah, into that. We made great progress already. I think one of the key ingredients is that we know the interhome team that we haven't changed, basically, mainly since uh the beginning of Home2Go. Because they were one of the first partners that signed a contract with us, even before Home2Go was even in the commercial register or like fully registered. And so that's obviously a big advantage in such an acquisition if you know um the the people prior, also in a partner relation, right? Because there you learn it differently than maybe if someone wants to be bored or it gets gets sold to you. And and so I think that's from an inter-home um perspective, also nice to now be part of a group that is fully focused on vacation rentals. Yeah, because prior they were part of hotel plan, and hotel plan was part of Migro, and that's travel hotel plan in general, but there are different parts of it, and one part was vacation rentals with with interhome. Here at home to go, everything, everyone talks vacation rentals, may it be in the marketplace, may it be on the software side, or may it be on the service side. And that's I think also an advantage for us as a higher and also helps in integrating, yeah, because you you talk the same language, yeah. That's that helps you uh a lot in the first place. And it is an older company than home to go is. But I'm super actually amazed, I must say, yeah, the positive energy that this uh company brought to the combination or to the acquisition uh through us. Really like people welcoming our people with home to go, inter-home logos in the local offices when we went, they're all wearing home to go merge that we gave them and so on, which is not needed, but shows you how positive this combination was reflected. And you alluded a little bit in into the direction of integration. So for home to go, it's also very important. We're not rolling over simply how how we do things and so on, because for us, there are some things that we can do well, and I think that's demand creation, that is direct to consumer, sending things, CRM, all these data technology topics. I think we've proven that that we are very good in that. But we've never done ourselves, except for the small acquisition of CALSA on the Baltic Sea, but we've never done on scale property management ourselves. And what we always do also when we acquire companies, what we are good at and where we think we can leverage our technology stacks, so the home to go marketplace technology stack into home after two months, or already after two months, rent on it because that is something if we can build it for Tui, we can very easily build it for our own subsidiaries. Whereas the direct connection to the homeowner, how to run a local service office, we obviously want the expertise from the people that have done it for a long time. And also the inter-home business was due to the fact that they were part of a larger travel group, if you want to phrase it like this, couldn't maybe do everything that they wanted. So if you look, for instance, um Migro, right, they don't allow bonuses for salespeople or for people in the total for the whole organization. It's a simple decision that the MIGO has somehow taken at some point, which is something that the the Interhome team now changed for the sales team because they said we always wanted to do it, but we couldn't. And so there is also a lot of initiatives that not necessarily has to be brought in by us. Nonetheless, we also have ideas when we looked into during the due diligence phase and what we what we thought, what could be things that can be done better. The management structure, as I said, broadly is in place as it was before, because we also want to treat these companies with their expertise as an own part and not fully absorb them. But for sure, we give them our technology, we infuse also personnel from home to go for certain positions or help finding personnel that you might need, because also this carving out of this tour-tier organization with Hotel Plan and Migro means that there's new personnel needed that might stay with Hotel Plan or Migro. And so far, that's my summary, basically. Yeah, so obviously the integration isn't yet fully done, but it's I'm pretty amazed by the culture in Interhome and how these like changes and new opportunities, especially are being seen, which is not the easiest. We have done a lot of acquisitions, and I must say, especially for the size, but generally, Interhome is super um uh uh super positive, what you hear from the teams and and and the people there, and that's uh very nice to see and obviously helps in such a combination.

SPEAKER_02

Obviously, it resonates for me very strongly, uh especially the STR language within within a group that helps. If you don't have the STR language within a TO and a food retailer that sells food across Switzerland, that's uh that's definitely a different language and different DNA. And then the incentivization of salespeople resonates very strongly. That's just not part of the Migro DNA. And uh, and and therefore there's a lot of opportunities and leverage for you to maximize the acquisition and and infuse it with the home-to-go technology approach and distribution approach, which is which is obviously key. So you can reduce your distribution costs ultimately, have potentially higher margins, and they operate a lean operation in destination, and then that's a good combination. Plus, with the business that you have on the marketplace, as well as the B2B business, but on the marketplace, you have now the leverage to even offer services to individual homeowners and small property managers as well going forward. So the opportunity is definitely massive, and I'm glad to hear that this is going according to your uh plans and everything else.

SPEAKER_00

Even faster in some regards. Yeah. So we we exited also some of the transition. You always have in MA these transition service agreements. Some of them we already exited prior we we initially thought. And so actually, so far, I have nothing to complain, I would say.

SPEAKER_02

That's fantastic to know. And yes, there is some local insights. I've done two carve outs out of Migros, so I know how you can potentially accelerate certain agreements as well. Ultimately, it's uh it's about what is there and and and the value being kept going forward. So that's that's great news. This episode is supported by Pickle. One of the more important shifts in short term rentals right now is how operators are starting to think differently about flexibility. For a long time, the industry framed the question too narrowly. Do we offer more flexibility to improve quality? Conversion and match the flexibility guests have come to expect on OTAs. Or do we keep stricter policies in place to protect revenue? That is where pickle comes in. Pickle is helping short-term rental operators build insurance-enabled solutions into the booking journey, making flexibility work better for guests, operators, and owners alike. More importantly, pickle solutions shift the conversation from a single booking conversion to the economics of the booking window as a whole, shaping booking confidence, pricing power, and broader revenue opportunities around each day. The next phase of growth in this sector will not just come from adding more inventory, it will come from designing better economics around the inventory you already have. Visit pickle.com slash str Global Unlocked to learn more. Let's continue with the show. So let's talk about economics and control. You know, one of the core questions in our industry is always where is value created and who captures it at the end of the day? Marketplaces traditionally capture demand side value, right? Operators capture supply side economics. Now, with interhome, now you see it on both sides. So you've got the you've got the demand and the supply. Does that change how you think about margins and pricing power and control over supply in general?

SPEAKER_00

No, I wouldn't say. Because in the end, as I've said, we really make sure that the different businesses within the group operate to their own benefit in the first place, obviously utilizing synergy effects over the group because data platform can be built by our data platform teams, marketing to consumers can be done via our demand generation teams and so on. But it's very important that we have two customers. Also in the marketplace, we have the partners, obviously, and the travelers, but the product itself is focused on the traveler that wants to book, right? On the interhome side, the main customer in the first place, obviously is also the traveler, but the main customer in the first place is the owner, the host, however you want to call it. But and that is something that we want to make sure, not only from a commercial perspective, but also like from a mindset perspective persists, right? So we are also not fans of weighing I build this feature for the demand side versus building this feature for the owner side. That's why the owner product is an own organization and not like mingling around with the um demand or marketplace kind of product organization. Fun fact that's also why you see that Interhome and Home2Go are actually a very good combination, is if you if if home to go speaks of product, we obviously speak of the tech product. If we speak of product, we speak of the tech product as home to go. When Interhome speaks about the product, they speak about the vacation rental, the short-term rental. So in the end, and that's uh already shows you what I said earlier, they are the experts for the actual rental. We are the experts to getting it sold. And that's a good combination, and you should benefit from the from the strengths of each other. And so that's why the commercial models for me are not like getting one, but they still are having their right to exist on both sides, but they anyway work together prior because the the property manager may it be Interhome or another property manager has to use distribution channels like the home to go marketplace to also get demand. So they anyway were connected um prior. So I don't see that becoming one model in the end.

SPEAKER_02

Yeah, without a doubt. I can see that say that from the outside. Fun fact my parents own a property in the Swiss Alps for over 30 years, never used Interhome for distribution, used Edomitzel, Edomitzel went at Traveo, Atraveo became Interhome. And now my property in in the Swiss Alps has been managed by so many different platforms, and I came full circle. So I'm now a customer of Interhome and Home2Go, funny enough, where I started with uh Detlef Chef Riohan first and then moved over to Atraveo. I've seen that transition and see what happens on the supply side, even though I'm still operating the property on my own. So it's it's definitely it strongly resonates. And I guess that's where the strength comes from ultimately as well. Let's go a little bit deeper on the distribution power shift here. Distribution has always been one of the biggest tensions in hospitality, regardless.com. We there's so much going on out there. Operators at the end one independence, hotels or property managers or individual hosts, platforms provide scale. And now with with AI entering the picture, Discovery itself might change fundamentally, right? And and how do you see the balance of power evolving going forward?

SPEAKER_00

Yeah. So for AI, let's maybe open it around that because I think that's that's anyway the the topic that most people probably currently think about. Generally, what we believe, and and what I believe, is that AI in travel, as you just said, right, will in the first place, and we already see that, be super helpful in the discovery phase. What prior was you do a Google search and you try to collect all these things together. Now you can say, lick me a travel plan, and you have it, like in in seconds. It already worked basically uh uh two or three years ago, and now the the the models have made more advancements, and even in the last three months, massive advancements if you look at coding and so on. But uh this is very clear. I think that that discovery is different and uh also shortened by that. I think that's that's the first thing. When it comes to how do people in the end book, and interestingly, there was already this fear that booking XVIDIA and so on get directly disseminated, and you saw stock prices falling because of this and and and so on and so on, shortly after OpenAI said maybe booking and buying directly in the um in the chat is is maybe not what we what we uh will see so soon, yeah, because maybe they also or probably they also realized it's harder than you think with a lot of these things. That's that's the macro, yeah. If I if I look myself into how what what, although everything is uncertain, but how what we see as likely, right? And then we say in the end, commodity, and it's not only for travel, that's in any vertical, but especially commodity will be hit. So I give you an example. If I go, let's say, to Frankfurt or so Om to go is headquartered in Berlin, but if I go to Frankfurt or to Amsterdam or wherever for a business trip, and the AI for one night probably it already knows what I like or can tell it. And then even if it does a mistake for one night, it's only me. It's anyway, uh I'm not going there for leisure. Like so I'm just needing a place to sleep, and I don't care where I sit in the train, because I usually uh try to take the train, but maybe also a flight. If it's just like for one or two hours you sit on the wrong place, fine. Yeah. So this is what people will probably try out first, like these easy, more commodity kind of travel. And then if this works, they might enlarge that to another level. But you know as well, or maybe even uh better than me, probably, I assume, how hard it is to um find the vacation rental. Because usually the traveler, when they do the vacation rental search, what they do is they have a budget in mind. And for this budget, they want to get the best property for their use case. And it's not, I want a four or five-star hotel with a rating above uh 4.5 or 9 or whatever. It is more complicated. You go with a family, you maybe have a dog, you have small children, so you maybe want a fancy pool. So a lot of information that you need to digest. And then you might, the style might be completely different, yeah, because if you go uh uh their one house to the other can have a completely different interior. So people want to look at it. On top comes the fact, what I think a lot of tech people also underestimate, that some people simply love to browse around. And you might not love to browse around for a business hotel because you just search for a place to stay. Yeah, that's not the same. Yeah. But if you spend two weeks there, you might want to browse around. And in the end, you also, it's not a decision of Patrick, but maybe the decision of the whole family. And if it goes wrong, yeah, if the AI confuses square feet with square meter, then you have like for two weeks a problem because uh you might have chosen not the right thing. So that's why I believe we will see definitely adoption with everything like this. First, we will see it in in uh these more commoditized travel arrangements like uh flights and and then train and hotels. And then it you will also see it for vacation renters, but it will simply take some time, and there will always be a large portion of people that still want to look at it. We also see that in home to go data, where people might use the app extensively, but they book on a desktop. And we have two beliefs in that. First, it's a bigger basket-sized thing. Secondly, it's because it's easier to sit in front of a desktop or laptop with your family than just on a mobile phone to look at uh the properties that you might have put in your wish list or um uh uh whatsoever. And generally, we anyway believe that um if you look and travel, so there are still travel uh offline travel agencies around, although people told us for 30 years that offline stores will disappear. There are not so many there, but there are still. And then mobile came, and people were saying, Oh, everything will be mobile. You just heard my example. Still, people use desktop, laptop also to browse, but especially to book and and so on. And so we will see that that adoption. But that's how I see a look at the world from that side. But obviously, for the supply side of our business, um, so the pro business may it be software or may it be like the inter-home business, it also opens up new demand channels. That's completely clear. And in a world that I actually don't believe in, but potentially in a world where all like mid-layers of marketplaces or OTAs wouldn't exist anymore. As I said, I don't believe in that, but yeah, even there, that would be like something where you need someone that has the direct access or the last mile to the property. And this is exactly where Interhome with its exclusive contractual like kind of structure, obviously is very well protected. But also on the software side, you basically give the people in the last mile the opportunity by your PNS. And so you have a certain like kind of way, but it will definitely open up more people coming directly to um uh to of the owner if you look at software, or of the exclusive property manager if you look on the full property manager, uh full service property management side like Pinterho. So that's how I see this whole uh this whole thing. And that is for us as home-to-go group, for sure, good. That even if I said a scenario I don't believe in, but even in a scenario where everyone books everything via agents, um, we have a very good uh mode with software and services that does now 63% of our revenues. Yeah.

SPEAKER_02

Well, you already gave a great segue, Patrick, to to basically my next question because you know it actually the question is does AI reinforce the large platforms or does it create opportunities for the operators to regain control? And basically what you're saying with your hybrid model that Ontogo is claiming to have, you can do both.

SPEAKER_00

I honestly believe that. So my short answer is always if you would have fired that in uh in the questions, it's uh a threat or opportunity, definitely opportunity. And I see it for us in any scenario as a net positive. So even in a scenario where parts of our business might suffer from it, what I don't believe in, but even in that scenario, it means automatically that the other part might gain because people get more directly to the interhome inventory, for instance. Yeah. So that's why we believe that besides all that, like how the traveler is doing it, anyway, AI poses a lot of opportunity to do things better, to test more, especially as you believe also when you look at Home2Go, we are compared, especially on the marketplace side, to the bigger brands out there. We are super lean and super small organizations. So utilizing AI for things that we maybe have done, wouldn't have done in the past because of resource constraints now gives you the chance to do more, much more with the same amount of people and also quicker because the smaller the organization, the easier it is also like to get that kind of um cultural change in it. And also, by the way, for integration projects, suddenly you have um a helper that can help you with some of these topics where you prior might needed to do certain things manually or so on, because it's one-time efforts maybe to move something from one system to another and so on. So there are a lot of opportunities also on the efficiency side that arise with AI and where we see actually as a smaller company even a bigger chance for us because you suddenly are not limited by maybe resources to that extent.

SPEAKER_02

So direct versus platform, I mean, that's what we talked about, and we talked about it for years within the industry. But in reality, especially when you think of the broader, fragmented vacation rental space, many operators still struggle to scale that. And from your vantage point, why has a direct booking remained so difficult to achieve? And and do you believe that changes meaningfully with new technology, just to your point that you just made?

SPEAKER_00

Yes, I actually agree with, and this is a little bit what what I said about why we actually came to the idea of Home2Go Pro. Because internalizing the booking flow from changing home2go initial model metasearch into marketplace, we saw sometimes extreme uplifts in terms of amount of bookings, simply conversion, way before AI. Yeah. Or where before AI was a buzzword. We as home2go used machine learning for a long time. And everyone knows that LLMs are basically machine learning, and but they got so good that they got this new buzzword AI, and now suddenly everything changed. So it's still machine learning, right? Exactly. It's probability of what is the next uh the next uh word, basically. But the thing is nonetheless that with AI getting so much better, it's also easier to use it without having for use cases where you prior would have said, ah, maybe it's not good enough. Nonetheless, we already used a lot of machine learning in the past to actually make things better on scale, because we um agglomerated so much inventory that it was needed to make it consistent. So, but taking this to your question, like why this was a problem, and we see that again now when we took over Interrom, the problem is simply a front end is not a front end. You can build, you can build a copy of a front end of Home2Go, you won't have the same conversion because you don't know the underlying uh topics that we tested now over more than 12 years and on scale. A small operator has the big problem that you can't test your website on scale. And that, by the way, it doesn't change with AI. You can maybe have a nicer website and Claude tells you that this is converting, but it takes you ages to understand is the button sitting uh above this information or below better. And maybe it's also tied to your own brand and not necessarily what works for Airbnb or booking or home2go works on your website. Yeah. And so I think that is one of the things which held operators back. So you need to have a website that has the chance to well convert, because if you want to get direct traffic and maybe if you even want to spend on performance marketing, you are competing with the big demand platforms that have more inventory. So by that already, by definition, higher conversion likelihood. And secondly, and I don't mean that mean, because it's simply because if you don't have so much traffic, it's hard for you to test a product that is probably not that well converting. And that's exactly the thing why we built Home2Go Pro, because the Home2Go marketplace software, as I said, now runs on Interhome and obviously that is a positive effect for them. Although Interhome is already a big company and had some traffic, some infrastructure. Now scale that down on a property manager that has maybe 1,000 properties or only 100. How should you build a website? Usually they are built by an agency, local agency, and never changed, right? How should you build a nice website with good payment where you need a lot of infrastructure in the back? And this is something where for home2go, it helps that we have this like big marketplace where we can build it centrally, where it also makes sense to build it, and then we can reuse it for our own direct operators, like Interhome, but also, for instance, uh Krausa. They both run on home to go marketplace technology. And that means they can use home to go payment, they get automatic updates, they don't have to care about certain things if legal topics change and so on, because it's automatically coming over from the marketplace and and and so on and so on. And that's um that's very helpful then for the conversion in the end. And that's where an operator gets at least then competitive to a certain extent. And I think that is one of the big things that stands against operators being efficient in by acquiring traffic because of converting traffic, product and selection is a topic.

SPEAKER_02

Does that also mean that you're going to acquire more property management companies?

SPEAKER_00

As we said, right? Like so our we have been very acquisitive in the past. And when something works, we usually try to continue it. And that's also why we why we said yesterday, so for sure, we will further acquire companies on the especially on the B2B side, or only on the B2B side. That's our clear focus now. And that's also mainly we see it for Interhome as a um as a good like kind of exit opportunity, also for people that might can't give their very well-run business into the next generation. So we have a lot of these cases or had in the past already these cases where people like simply don't want to see their what they built over a long time, but maybe the children don't want to take that over. That Interhome is a very nice home to give uh the inventory into. And obviously, Interholm has like these more than 200 local service offices around Europe, which means usually there is also a service office that is uh near, so where these like companies can be also locally be integrated into. And so this is definitely something that that we will continue. Um, and also um are interested in if people are interested to talk to us, obviously, because we have also different models also with the LSOs, like it dom has this kind of franchise model also for some of the LSOs. So there is obviously a lot of opportunity um on that side, and we are always open to talk, and we will continue definitely to acquire companies.

SPEAKER_02

So before we wrap this up, um, I would like to talk about your competition. And if we call our your earlier competition or pre-supply acquisition called Airbnb, booking.com, Expedia, maybe even Holy Doo and others. While you've made quite a pivot strategically from your into your B2B side of things, where does Home2Go win, do you think? And where do you deliberately not to choose not to compete? Because, you know, Airbnb has made acquisitions in Paris for PMCs, you know, that didn't go anywhere. Obviously, booking has played around, but never acquired supply. Uh, Expedia bought uh VRBO in 2015, but that was a marketplace in itself as well, and and never played around with it. So coming back, where does Home2Go win next to your competitors? Is that now your pivot towards the more focused on the B2B business?

SPEAKER_00

If you look in into the marketplace world, right? Like, and you said it in the beginning, it also depends a little bit on the market. But for instance, in the German market, where you look, we probably are after booking number two. Because we're definitely sometimes bigger than Airbnb and also than than Verbo uh Favor Direct for like on the traveler side, but it's obviously not the case on a global scale. And the global scale is a completely different kind of topic on the marketplace side. So that's why on the marketplace side, we also decided for this year um to focus more or even more on profitability. Because we have a good basis of organic brand and retention traffic, like in combination, and to actually lower the marketing spend and increase by that marketing efficiency and by that also like the bottom line for the marketplace segment and not necessarily investing into fighting for market share at this point. Resetting a little bit, you can say, like the profit level of the marketplace. And so far it works, seems to work out. Our focus is the B2B side. If you look at the last year's performer numbers, is B2B. That means also like there we we we are actively aiming to further consolidate the market. Because even if you look at the European serviceable market for property management, you can see that even the biggest three companies, including us, are roughly only like covering 10%, because it's such a fragmented and non-consolidated market where there is a large opportunity to actually do that. While in Europe, home to the home to go group, with all the businesses together, we are the leading vacation rental group here by now with all the things together. On the supply side, if you look at software and services, we are probably one of the biggest clusters also for the other OTAs, by the way, right? Like as a um as a supplier of um of vacation rentals in total. If you take, yeah, if you take all of our businesses together, we are way above uh uh 200,000 properties where either home to go software or service management is like the last mile to the property. And so I think that's where we definitely see that in the um on the B2B side, we are one of the really big guys, whereas on the marketplace size, we are big, but the distance obviously to Airbnb, booking, or even Exvidia Verbo on a global scale is a little bit farther than uh the size of ourselves in the B2B size.

SPEAKER_02

Yeah, I I love that combination. Let's see what comes about. You know, maybe soon you will acquire a ways from Platinum Equity and then Sykes from Vitruvian as well, and then you can wrap up the UK market because at the end of the day, it's it's it's pretty questionable what is the next level. And I think before we close, I want to ask you about the future and the future of the model and look a little bit into the crystal ball where things are heading. But I think you've you've created yourself a strategic advantage, which uh makes a ton of sense. What do you think what the next generation of hospitality companies actually look like? We end up with hybrid models. I mean, we've seen even a even a forge going hybrid will with owning assets and not just managing assets, or even going deeper in owning supply. Or do you think will the industry separate again into distinct layers?

SPEAKER_00

Interestingly, that's a general uh cycle of business, right? So the general cycle of business is often like combining things, then breaking them up again, then combining that a little bit like the cycle of life of businesses or like also categories or verticals. Yeah. I would answer it like this for this time, and that's also what is a little bit connected to the to the big unknown, where AI will really lead in these days and how fast, because the acceleration is simply is is crazy. Like so I usually say internally, if you have tried something with AI and it didn't work half a year ago, have you tried it yesterday? Yeah, and it's not me being annoying, I hope, but like it's it is unfortunately, or fortunately, however you want to look at it, the thing that experience of what works and what doesn't work for AI is simply not something that you can uh call. Because if you think like one year ago, Claude code was just like released and was okay-ish, maybe, and some people tried in the first place and it didn't run. And since basically February, um, a lot of people like do crazy stuff with it. Like even the acceleration from last December to February is brutal. And if you look at also like these metrics for the AI models and you see like Claude from 4.5 or Opus 4.5 to 4.6, it sounds like a small step up in versioning. But in the end, if you look at the what it means in performance, it's huge. And I think that's something that we obviously have to keep in mind because if you look into uh software or if you look into like these super cycles, like we had one when Microsoft, Apple, and so on came. The next one was the internet, and now we have, from my perspective, and I think not only from my, but probably a lot of people think that way, the next super cycle, which means a lot of cards get new remixed, like you say in German, I think, or reshuffle the deck or something like this in English. And that gives a lot of opportunity to a lot of people that have um uh that may not have had like the chance before, as I said, even on the marketplace side, we with a smaller team can now do things that we wouldn't have done maybe without AI because we wouldn't have resources like bigger marketplace players. But it also means that all the stuff we talked about, opportunities for operators, for supply holders, and so on, like are there. And that's from my personal perspective and uh from the home to go perspective, our advantage is that we are active in all parts of the market. So, like if there's opportunity, we have at least a chance to participate there. So, what I mean with that is that currently the model of having being active in and on all fronts, we at least see it as a strategic advantage because we can on one hand leverage that, but on the other hand, it may be also, if we think in extreme scenarios, as I said, that I don't believe in that only agents books, it's also a hedge against being disseminated as a as a marketplace. And so I think like currently having this integrated end-to-end model where we can theoretically like help the full value chain, nonetheless being focused with the organizational-wise on the customer group. So over-obsessed about the traveler on the marketplace side, over-obsessed about the owner on the pro software and services side is for us the right model for this time.

SPEAKER_02

Yeah, without a doubt. And that's become very, very clear. And I would strongly agree that the cars are definitely being reshuffled, and it's a super cycle, without a doubt, um, that still needs to boil out. We have no clue how this is gonna end up, and we've had many interesting voices on the podcast who talk about those as well. So, Patrick, it has been a particularly interesting moment for me to talk with you, and also an interesting moment for home to go. So, only wish you the best. You're moving from a pure aggregation into a more integrated model. Distribution and consumer behavior are all shifting. We talked about those as well, and that combination makes the next few years in the industry incredibly dynamic and remains very interesting. So, I want to thank you for joining us today, and and I wish you and and your entire team uh the best of success. Thank you for joining STR Global Unlock, Patrick, today.

SPEAKER_00

Thank you for having me. It has been a real pleasure. Um, and I'm really happy to come back. Thank you very much.

SPEAKER_02

That was STR Global Unlock, where we say what others want. If you got value from today's episode, send it to someone who is still playing it safe. Follow the show and get more global insight at ajlartelier.com. The globally recognized STR consultancy, I founded and that proudly brings to you this show. More bold conversations are on the way, so stay tuned.