Vacasa | Idaho Business Review

Vacasa gets additional funding to overcome coronavirus

photo of sky view lodge in fish haven, idaho — Vacasa manages more than 600 homes in Idaho, including the Sky View Lodge in Fish Haven. Photo courtesy of Vacasa

Vacasa — which, like many vacation rental companies, was hit hard by COVID-19 — has received an additional round of funding from its investors that is intended to help it through the crisis.

The company, which has headquarters both in Portland and Boise, identifies itself as North America’s largest vacation rental management platform. In a statement, the company announced a $108 million Series D strategic investment round, led by existing investor Silver Lake with participation from other existing investors including Riverwood Capital and Level Equity.

“Like many companies in the travel industry, the pandemic has had a significant impact on Vacasa,” according to a company spokeperson who asked not to be named. “To put the company in the best position moving forward, we decided to raise additional financing. We’re in a very fortunate position as our existing investor syndicate — Silver Lake, Riverwood and Level Equity — were eager to continue to partner with us.”

The company will use the new funding to fuel its growth in the U.S., as well as invest in technology and product innovation, the company spokesperson said.

Vacasa had announced a $319 million third round of investment earlier this year, which gave the company a valuation of more than $1 billion. Hitting that $1 billion mark placed it in the “unicorn” category in startup parlance.

In March, the company had announced an unspecified number of layoffs and salary cuts after concerns about coronavirus, flight cancellations and state lockdowns had decimated the entire travel industry. For example, CEO Matt Roberts — just named in February — didn’t take any salary, and the leadership team took a 50% reduction in salary through the end of the year.

Industry already recovering

That said, however, the industry is already recovering, the company said in a statement.

“Vacasa is already experiencing strong recovery as stay-at-home restrictions lift and popular vacation destinations reopen,” the statement said. “Recent data from the company reveals a substantial increase in daily reservations in more cities and a reduced booking window.”

For example, guest reservations booked in May were six times those booked in April, indicating an increased interest in leisure travel, the company said. In addition, the company now has guest bookings in 723 U.S. cities, compared with 357 U.S. cities at what it said was the height of the crisis.

In April, Vacasa saw its booking window peak at 142 days, signaling that guests were booking trips further out. Since mid-May, Vacasa’s booking window is back down to 40 days, in-line with 2019 averages, the company said.

In addition, the company launched Vacasa Premium Clean, a new program that meets or exceeds all currently published CDC recommendations and follows the Vacation Rental Management Association’s SafeHome guidance.

“As demand for vacation rentals continues to increase, Vacasa’s goal is to provide even more protection and support to everyone in the communities it serves,” the company said.

IPO? Maybe not so much

Roberts’ appointment had led some to speculate that the company might be preparing itself for an initial public offering. He served as CFO from 2005 to 2011 and CEO from 2011 to 2015 at restaurant booking service OpenTable. As CFO, he led OpenTable through an IPO in 2009, and as CEO he negotiated the sale of the company to the Priceline Group (now Booking Holdings) for $2.6 billion in cash. He joined the Vacasa board in November 2018.

In October, Vacasa finalized the acquisition of Wyndham Vacation Rentals, which brought several brands, including ResortQuest, Kaiser Realty and Vacation Palm Springs, under its ownership. Plans for the acquisition were announced last July and are expected to be completed by this fall.

As of the acquisition, Vacasa managed 503 vacation homes in Idaho, while Wyndham managed 109 rentals in the state.

Vacasa, which identifies itself as a technology company more than as a vacation rental company, added a new chief technology officer earlier this year as well.

Vacasa grapples with fallout of COVID-19 coronavirus

photo of idaho vacasa home — Vacasa is continuing to rent out vacation homes, like this one in McCall, but recommends that customers follow CDC guidelines. Photo courtesy of Vacasa

It would be an understatement to say that times are tough for all aspects of the travel and vacation industry, and Vacasa — which maintains a headquarters in Boise as well as in Portland — is no exception.

The company said it is instituting cost-cutting measures, including layoffs.

“Over the next few days, we will be reducing hours for some employees and laying off others,” the spokesman said. “This includes valuable team members in our headquarter offices, and in locations where we care for vacation rentals around the world. Our CEO is not taking any salary, and our leadership team is taking a 50% reduction in salary through the end of the year.”

The company didn’t say how many people it expected to lay off.

Vacasa is also taking steps to respond to the unprecedented outbreak.

“Our primary objective at Vacasa has been to work with guests to amend reservations in response to health concerns, as needed,” said a company spokesman in an email message.

Maintaining safety

For reservations that are kept, “we have remained in close communication with our homeowners to ensure they understand decisions to safeguard against further spread of illness,” the spokesman said. “We employ local team members in every destination where we operate, which allows us the ability to ensure our homes are cleaned thoroughly, in line with guidelines set by the World Health Organization and Health and Safety Executive.”

To help maintain distancing, many of the company’s homes have electronic locks or lockboxes, which lets guests check-in without having to interact with people and reduces the chances of spreading illness, the spokesman said.

To maintain safety for staff, the company offers benefits, including flexible paid time off, and the ability to work autonomously and remotely, the spokesman said.

Needless to say, the company encourages customers to adhere to the Centers for Disease Control and Prevention health and safety guidelines, as well as with travel restrictions issued by federal and local governments.

Industry better off than others

According to AirDNA, a Denver-based organization that follows the short-term rental industry, short-term rentals are more resistant to the impacts of the COVID-19 coronavirus than are other travel sectors such as hotels, cruises, and airlines.

First, vacation rentals are often in more remote locations with less direct exposure to other travelers. Second, vacation rental guests often visit destinations within driving distance, which allows them to bypass the potential risks of airline travel.

In addition, because vacation rentals are booked further in advance than hotels, and in larger groups, canceling is often more cumbersome. Also, vacation rentals impose tougher cancelation policies that motivate travelers to stick with their plans, the organization said.

Chief revenue officer

Coincidentally, the company recently hired Mike Dodson, formerly of OpenTable, as chief revenue officer.

In the role, he is responsible for organic sales, corporate development, homeowner marketing, and revenue management.

“Having these areas under one leader will allow us to optimize customer acquisition efforts and increase revenue for existing Vacasa homeowners,” the spokesman said, adding that a number of other major companies, including Intel, Koan and VisitPay, also have such a position.

Dodson worked with Matt Roberts, who was named Vacasa interim CEO in February, at OpenTable, according to the spokesman.

“At OpenTable, Mike scaled the business from less than 800 restaurants in four U.S. cities to more than 40,000 restaurants around the world,” the spokesman said. “Mike was critical in the company’s 2009 IPO, and its subsequent sale to Priceline Group (now Booking Holdings) in 2014.”

Creating the new position is unrelated to the COVID-19 outbreak, according to the spokesman, who noted that the hire occurred before the pandemic.

“Bringing in an experienced chief revenue officer aligns with Vacasa’s direction and trajectory, and will help ensure our long-term success,” the spokesman said.

Could new CEO take Vacasa public?

Vacation rental company Vacasa has a new CEO, a move that might presage it’s going public.

“After 10 years as CEO of Vacasa, our founder Eric Breon has decided to step away from day-to-day operations, and focus on vision and strategy for the company by serving on its board,” said Anni Murphy, public relations manager for the company, headquartered in Portland and in Boise, in an email message. “He will lead Vacasa’s search for a new CEO. In the meantime, Matt Roberts, former OpenTable CEO and current independent director on the Vacasa board, will assume the role of interim CEO.”

Under new management

Eric Breon

Since founding Vacasa in 2009, Breon grew the organization to more than 25,000 homes under management and 6,000 employees worldwide, the company said in a statement. After its October purchase of Wyndham Vacation Rentals, Vacasa is on track to exceed $1 billion in gross bookings and $500 million in net revenue in 2020.

Roberts served as CFO from 2005 to 2011 and CEO from 2011 to 2015 at restaurant booking service OpenTable. As CFO, he led OpenTable through an IPO in 2009, and as CEO he negotiated the sale of the company to the Priceline Group (now Booking Holdings) for $2.6 billion in cash. He joined the Vacasa board in November 2018.

His expertise at OpenTable offers a possible hint about Vacasa’s plans for the future.

“Considering the significant market opportunity and our 60% year-over-year growth, going public is definitely an option,” Murphy said. “Several factors, including market conditions, will determine if and when we go public.”

Roberts was also CFO of online consumer lending group E-LOAN and a member of the digital money transfer provider XOOM board of directors as it transitioned from the private to the public markets. In addition to Vacasa, he serves on the board of Quantcast, a provider of data-driven programmatic and digital advertising, and Snag, an online staffing platform.

Busy year

In addition to its headquarters in Portland and Boise, Vacasa has technology teams in Santiago, Chile; Auckland, New Zealand; and Destin, Florida. It has about 220 employees in its Boise corporate office, about 40 of whom are in technology, with another 100 in field offices throughout the state, as well as several job openings.

As of the acquisition, Vacasa managed 503 vacation homes in Idaho, while Wyndham managed 109 rentals in the state.

Vacasa, which identifies itself as a technology company more than as a vacation rental company, added a new chief technology officer earlier this year as well.

Investment history

At the same time as the finalization, the company announced a $319 million third round of investment – larger than the $200 million Airbnb received for its third round in 2013 – which gave the company a valuation of more than $1 billion. Hitting that $1 billion mark places it in the “unicorn” category in startup parlance.

The round was led by Silver Lake, which specializes in technology investing. Existing investors Riverwood Capital, Level Equity, and NewSpring also participated in the capital raise. Financial terms were not disclosed.

With a first round funding of $103.5 million and a second round of $64 million, Vacasa has raised a total of $526.5 million in private equity funding — more than any other startup of its kind, according to industry reports.

Vacasa markets and manages vacation rental properties across the country. Property owners list their homes on Vacasa’s website and Vacasa hires management, cleaning and maintenance staffers to oversee the sites. It takes a commission on each booking. It competes against other holiday listing services such as Airbnb, HomeAway and VRBO, but operates somewhat differently because it both lists and manages properties for its clients.

Catching up with Vacasa, as it trips along with a new CTO

You may think of Vacasa as a vacation rental company, but it’s really not. It’s a technology company. Just ask the new chief technology officer (CTO).

“Our founder was passionate about technology in the early days of the company,” said Jeff Flitton, named CTO earlier this year after working at Vacasa for two years. “It’s most important now that we use technology because we are endeavoring to do property management at a scale like no other.”

More integration

Vacasa, which raised a $319 million series C round in October, uses technology to integrate its platform directly with others more than its competitors do, Flitton said.

“I feel like it’s a real differentiator for us and the owners to be able to list their properties on our own ecommerce platform,” he said. “It’s important that we get it in front of as many people as possible, so we integrate with a number of channels.”

The company considered going through a channel manager – a “middleware” integrator piece of software that would operate between Vacasa and another website – but the results weren’t as good, Flitton said.

“Direct integration yielded higher results because we were able to have higher quality and consistency in our data,” he said. “Going through a channel manager meant we had to work with the lowest common denominator.”

To have access to the richest possible dataset, the company intentionally built more direct integrations, he said.

So far, Vacasa has direct integration with Vrbo, Airbnb, Booking.com, Expedia, Google, TripAdvisor and HomeToGo. And there’s likely to be more coming down the pike, Flitton said.

“We have a bit of a pipeline out there,” he said. “At this point, we feel like we have our bases pretty well covered. The next step in channel integration is to release an open [application programming interface] for smaller, boutique travel agencies to integrate to us.”

Big companies such as Airbnb have their own website interface, Flitton said.

“It’s more of a collaborative effort, and we conform to their specs,” he said.

But the smaller, boutique websites, such as Ski.com, nonetheless drive a lot of value in their markets.

“The open API should be a force multiplier for us,” he said.

Other technology uses

Vacasa has headquarters in Portland and Boise, and also has technology teams in Santiago, Chile; Auckland, New Zealand; and Destin, Florida. Right now, it has about 40 tech people in Boise, with at least six open positions, Flitton said. The company hopes to draw from tech workers leaving larger cities for an improved quality of life, he said.

“Philosophically, we’re a real believer in opportunistic hiring,” he said. “We hire the right people when they become available. We’re fortunate that, because of growth, we can do that.”

Without technology, Vacasa couldn’t scale to the extent it has, Flitton said.

While one person can schedule 10 housekeepers, Vacasa has thousands of them, around the world, and the company not only wants to optimize their scheduling to get units ready to rent as quickly as possible, but also wants to be humane to the housekeepers and give them a consistent workload, he said.

“We have thousands of employees who make sure Vacasa homes are clean at the end of every stay,” he said. “We have to use technology to make those decisions.”

Flitton’s job is to continue the technology work that Vacasa started.

“Right now, we’re mostly about making sure we’re making the right investments” in areas such as property management, field management, online travel agencies and integrations with others, he said.

Vacasa is also looking into adding machine learning to help improve guest services, by using past activity – whether the person booked a stay or not – to infer what customers might want, without being creepy about it.

“We try to be very mindful of how often and how we interact with guests to encourage brand loyalty without overstepping,” he said.

‘Unicorn’ Vacasa completes acquisition, raises $319 million

Vacation rental company Vacasa announced the finalization of a major acquisition that could almost double the size of the company’s holdings, as well as a $319 million third round of investment.

Vacasa – based in Portland but with a Boise corporate office – finalized the acquisition of Wyndham Vacation Rentals, a move that will bring a number of brands under its ownership.

The company had announced plans for the acquisition in July. It was originally priced at $162 million, with $30 million in equity. The final amount was $156 million in cash and $10 million in Vacasa equity, said Anni Murphy, public relations manager, in an email message.

Series C funding

The $319 million investment – larger than the $200 million Airbnb received for its third round in 2013 – gives the company a valuation of more than $1 billion, which categorizes it as a “unicorn” in startup parlance.

The round was led by Silver Lake, which specializes in technology investing. It has more than $43 billion in combined assets under management and committed capital and a team of approximately 100 investment and operating professionals in Silicon Valley, New York, London and Hong Kong. Its portfolio generates more than $230 billion of revenue annually and employs 370,000 people globally.

Existing investors Riverwood Capital, Level Equity, and NewSpring also participated in the capital raise. Financial terms were not disclosed.

With this new financing, Vacasa plans to enhance its technology platform, expand into new markets and develop new offerings including Vacasa Real Estate, which has evolved from an agent network to a service model that includes brokerages in vacation rental markets throughout the country.

With a first round funding of $103.5 million and a second round of $64 million, Vacasa has now raised a total of $526.5 million in private equity funding — more than any other startup of its kind, according to industry reports.

More Idaho jobs

Vacasa has more than 3,300 employees, about 220 of which are in its Boise corporate office with another 100 in field offices throughout the state, Murphy said. The number of Idaho employees is likely to increase, though the company wasn’t able to provide specifics.

“Vacasa will be bringing on Wyndham Vacation Rentals employees throughout Idaho who will work in the field, as well as potentially in our Boise corporate office, spanning specialties such as engineering, sales, analytics and finance,” Murphy said. “Since our inventory size will nearly double from approximately 14,000 to more than 23,000, we expect there will be a demand for new roles within Vacasa in Idaho and beyond.”

With the acquisition, Vacasa will begin to migrate the Wyndham Vacation Rentals portfolio of more than 9,000 homes in 50 destinations into its platform over the next 12 months, the company said in a statement. In total, Vacasa will manage more than 23,000 homes across North America, Europe, Central and South America and Africa. Integration is expected to be complete by fall 2020.

Currently, Vacasa manages 503 vacation homes in Idaho, while Wyndham manages 109 rentals in the state, Murphy said.

Other Vacasa developments

Vacasa also said it will absorb management of 140 homeowners associations (HOAs), which will fold under Vacasa Community Association Management. Short-term rental-focused HOAs in Alabama, Colorado, Delaware, Florida, South Carolina and Utah will transition to Vacasa, bringing the total HOAs under management to 156.

The company also announced last month that it had launched a direct application programming interface (API) integration with Google, meaning that guests can now search and book vacation homes managed by Vacasa through the search engine.

Vacasa settles into new, bigger home in downtown Boise

Vacasa’s new Boise headquarters has a dining area that doubles as a meeting space and break room. Photo by Teya Vitu.

Vacation home management leader Vacasa recently had big moving days for its Portland headquarters, as well as its second headquarters in downtown Boise.

Vacasa, the largest U.S. home vacation home management company, in August moved its Portland headquarters with 400 employees across the street in the Pearl District to fill a new five-story office building at the Heartline, which includes a second, 15-story apartment tower with 218 units.

In July and August, Vacasa also moved its downtown Boise office a couple blocks into two floors of the former J.S. Simplot Co. space at One Capital Center on Main Street.

Vacasa occupies 34,000 square feet of the second and third floors with two-thirds of the company’s finance office; the recruiting arm of its human resources department; part of its corporate development/acquisitions; and information technology and technology staff that maintain the website. The Boise office also has agents in Vacasa’s newly established real estate department to work with guests looking to invest in vacation rentals or owners looking to sell vacation rentals.

Vacasa presently has 145 employees in Boise with 20 more job openings now posted and the likely addition of 50 to 80 employees in Boise in the next year, said Ryan Vestal, Vacasa’s chief financial officer, who is based in Boise and a Wendell native.

All 20 tech staff were hired from the Boise area, according to Caleb Donegan, Vacasa’s vice president of digital.

“Last year, we had zero (IT and tech in Boise),” Donegan said. “We should have close to 30 by the end of the year. There’s no sense of stopping hiring. We are able to recruit the same type of talent in Boise that we have in Portland.”

Vacasa decided to expand its headquarters to Boise because CEO Eric Breon lived in Boise on two occasions from 2001 to 2008 and from 2011 to 2015.

“Eric is a lover of Boise,” Donegan said.

“We think Boise is a good talent pool,” Vestal said. “Eric is very committed to both locations. We have a strong leadership presence in both locations.”

Vestal acknowledged that the Boise office costs about half as much to operate as the Portland office, but said that was not the reason to expand in Boise rather than Portland.

Vacasa, founded in 2009, arrived in Boise in April 2013, and until recently occupied about 16,000 square feet on four floors in the Plaza 121 building on Ninth Street, the same building that includes Bacon and the Capital City Development Corp. offices.

The Boise office resembles the Portland office with prominent use of blue and white; open work areas; large, open dining/meeting/ping-pong playing area and various nooks with seating built into walls.

Vacasa did not disclose the tenant improvement costs for the Boise office, but the building permit applications at the city of Boise lists the project valuation at $2.7 million.

Vacasa presently manages 10,600 vacation homes in 23 states and 16 countries. Idaho ranks eighth with 430 homes, 135 of them in the McCall area.

Vacasa books vacation homes but also manages and maintains the vacation properties. In contrast, Airbnb and VRBO are exclusively listing services, which Vacasa also uses to list homes.

Vacasa’s early October acquisition of the Hyatt-backed Oasis Collection allowed Vacasa to surpass Wyndham Vacation Rentals as the largest U.S. vacation rental company, Vacasa officials said.

Vacasa takes a large bite out of the vacancy left when Simplot moved its corporate headquarters a few blocks in February 2017 after being in One Cap. Vacancy at One Cap peaked at 108,904 square feet in April 2017. With Vacasa filling two floors and, by the end of the month, engineering firm Jacobs, formerly known as CH2M Hill, filling nearly two more floors, One Cap vacancies will be down to 18,842 square feet, said Jeremy Malone, vice president at Oppenheimer Development Corp, which owns One Cap.

“We don’t have a lot of space left,” Malone said.

Vacasa acquires Accommodation Services in McCall

The Lake Fork Lodge is one of 130 short-term rental homes in McCall that Vacasa manages. Image courtesy of Vacasa.

Vacasa, the Portland-based vacation property management firm, on Feb. 6 acquired Accommodation Services in McCall and its 75 short-term rental home accounts.

The acquisition more than doubles Vacasa’s presence in McCall to 130 privately owned vacation homes that it manages and provides housekeeping for. Vacasa, established in 2009, has managed vacation homes in McCall since 2013.

Vacasa also acquired Accommodation Services’ downtown McCall storefront front office. The McCall storefront is only the 30^th storefront office Vacasa maintains in 11 states, even though it manages more than 7,000 homes in 20 U.S. states, Europe; Central and South America; and South Africa, said Zac Monahan, Vacasa’s senior director of integrations.

Vacasa has other Idaho storefront offices in Boise and Sun Valley, and it has its second central office in downtown Boise, where the Vacasa’s finance office, human resources, corporate development and telephone guest services reservation center are located.

Vacasa manages 378 homes in 18 Idaho communities, including the Pioneer Condominiums at Bogus Basin.

The McCall office will allow Vacasa to centralize its housekeeping functions. Until now, employees have been picking up cleaning supplies at a storage facility, the only Vacasa facility in McCall.

“It allows us to have operations efficiency,” Monahan said. “It really allows us to have a higher level of interaction with homeowners and guests.”

Vacasa’s 30 storefront offices

Portland, Oregon

Seaside, Oregon

Mt. Hood, Oregon

Sunriver, Oregon

Chelan, Washington

Sun Valley, Idaho

Boise, Idaho

McCall, Idaho

Big Sky, Montana

Whitefish, Montana

Big Bear, California

Cayucos, California

Groveland, California

Gualala, California

Mammoth Lakes, California

Mendocino, California

North Lake Tahoe, California

Moab, Utah

Park City, Utah

Solitude, Utah

Silverthorne, Colorado

Steamboat Springs, Colorado

Davenport, Florida

Whitehead, Florida

Key West, Florida

Naples, Florida

Miami Beach, Florida

Elijay, Georgia

Fredericksburg, Texas

Lahaina, Hawaii

Vacasa manages 378 short-term rental homes in 18 Idaho communities

Boise

Ketchum

Hayden

McCall

Sun Valley

Coeur d’Alene

Harrison

Donnelly

Sandpoint

Sagle

Tamarack

Bayview

New Meadows

Worley

Cascade

Garden Valley

Post Falls

Spirit Lake

Editor’s note: A spelling correction for Mendocino was made at 12:33 p.m.

Vacasa claims a chunk of former Simplot space at One Cap Center

Vacasa, the vacation home management firm, has had a central office in Boise paired with his Portland headquarters. Photo courtesy of Vacasa. — Vacasa, the vacation home management firm, has a central office in Boise paired with Portland headquarters. Photo courtesy of Vacasa.

Vacasa will fill part of the former J.R. Simplot Co. office space at One Capital Center as the nation’s second largest vacation home management company doubles the size of its Boise office.

Vacasa is headquartered in Portland but has a second central office in downtown Boise, where the company’s finance office, human resources, corporate development and telephone guest services reservation center are located.

Vacasa will occupy 34,308 square feet on the second and third floors of One Capital Center with a right of first refusal on the first floor, said Amber Knight, senior director of corporate development at Vacasa.

Vacasa has had an office in the Plaza 121 building in downtown Boise since 2011, but next year Vacasa will double its space in the One Cap Center. Photo courtesy of Vacasa.

Vacasa’s Boise office now occupies about 16,000 square feet on four floors in the Plaza 121 building on Ninth Street, the building that houses the restaurant Bacon and the offices of the Capital City Development Corp. Vacasa, founded in 2009, has had a Boise office since 2011 and now has 108 employees in Boise.

“It’s pretty safe to say we would have 200 (employees) by the end of next year,” Knight said.

Vacasa books vacation homes and also manages and maintains the vacation home properties, unlike Airbnb and VRBO, which are just listing services that Vacasa also uses to list homes, Knight said.

Vacasa lists 7,000 vacation homes in 18 states and 15 countries.

Boise was selected as a central office because Vacasa CEO Eric Breon has lived in Boise on two occasions from 2001 to 2008 and from 2011 to 2015.

OA+D of Boise is the architect. RRC Contractors of Nampa is the general contractor.

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