Singapore, October 16th 2019 — ZEN Rooms (“ZEN”, “Company”), one of the leading economy and mid-range hotel franchises in Southeast Asia, today announced it had signed a definitive agreement with travel group Yanolja regarding additional investment, acquisition of early investors’ stakes and the signing of a wide strategic alliance. Yanolja is the leading travel group in South Korea, backed by Booking Holdings and GIC, among others. Yanolja was the lead strategic investor in the company’s US$15M funding round in 2018, with the right to invest further. Early investor Asia Internet Holdings (Joint Venture of Rocket Internet and Ooredoo Telecom) has agreed to exit its stake to Yanolja. RedBadge Pacific and SBI Korea remain investors, and Access Ventures join as co-investors.
The alliance of ZEN and Yanolja creates the leading economy & mid-range hospitality group in Southeast Asia. It combines ZEN’s top-rated budget hotel franchise business with Yanolja’s scale, hospitality technologies and the backing by the global leader in Online Travel, Booking Holdings (behind Booking.com, Agoda, Priceline.com, Kayak etc), thus granting ZEN unique competitive advantages in both hotel technology and sales distribution. The groups will work to heavily deploy automation technology to enhance customer experience, further reduce budget hotels’ operating costs and reinvent budget hospitality across Southeast Asia.
ZEN Rooms is today one of the largest hotel franchises in Southeast Asia, with 13,000 rooms under franchise. Since Yanolja’s investment in mid-2018, ZEN has grown revenues 400% and has become Q2 2019 the largest hotel chain in the fast-emerging Philippines, with 5,500 rooms under franchise.
Southeast Asia is today the world’s fastest-growing travel market, fueled by exponential domestic and regional demand of young travelers and millennials (e.g. the number of Chinese visitors has quadrupled in the past decade). Yet, the value-for-money proposition of its budget hotel sector has historically been defective, plagued by several issues: fragmentation, poor hygiene & safety standards, lack of training and low technology use.
ZEN was founded in 2015 to improve the state of budget hospitality and bring much needed operational and technological efficiency to the estimated 2 million independent economy rooms in the region. Thousands of hotel owners have since joined ZEN’s franchises to improve their revenue, optimize their cost base and increase the long-term value of their property. These efficiency gains ultimately benefit travelers who can enjoy safer and better value-for-money stays.
With a deep emphasis on customer satisfaction, ZEN franchisees have enjoyed the best average guest ratings on Booking.com for two years in a row.
ALSO READ: HOW TO MONITOR EMPLOYEES’ OVERTIME?
- Yanolja, Korea’s billion-dollar travel group, double down on ZEN Rooms one year after investing US$15M in 2018. Through this transaction, Yanolja is investing additional funds in the Company, purchasing stakes from early investors and announcing a wide strategic alliance between the two groups
- ZEN joins forces with one of the most technologically innovative travel groups and its backers Booking Holdings to create the first full-service budget & mid-range hospitality group in SEA
- ZEN will heavily deploy technology to continue to improve Southeast Asia’s hospitality sector, enhance customer experience and lower hotels’ operating costs
- ZEN has achieved market-leading customer satisfaction ratings in its franchise business, quadrupled revenue in the past year and became in Q4 2018 the largest hotel chain in the Philippines.
Nathan Boublil, co-founder & CEO of ZEN, comments: “We started ZEN exactly 4 years ago to make budget accommodation in Southeast Asia more affordable and safer. We have proudly built ZEN into the top-rated budget hotel franchise in the region and were honored to be Yanolja’s 1st international investment. With this strategic alliance, we are joining forces with one of the most technologically innovative travel groups and its unique backers’ Booking Holdings to create the first full-service budget & mid-range hospitality group in SEA, able to deploy world-class technology infrastructure in IoT R&D, automation, hardware, and software to all hotels in Southeast Asia. This alliance will greatly benefit our ability to serve our hotel clients and ultimately the travelers of the entire region”.
Jongyoon Kim, CEO of Online Business at Yanolja, adds: “Since first investing in ZEN, we have shared the same vision of operational excellence and customer-centricity to radically improve the SE Asian hospitality market. In the last 12 months, the ZEN team has taken major steps to fulfill this vision and has grown exponentially while displaying top inventory quality. With this exciting agreement, Yanolja plans to fully support ZEN to solidify its status as the market-leading full-stack hospitality company in the region”.
About ZEN Rooms
Founded in 2015 by entrepreneurs Kiren Tanna and Nathan Boublil, ZEN Rooms was founded to improve the state of budget hospitality in Southeast Asia, making travel more affordable and safer. ZEN is now one of the fastest-growing hospitality companies in the region, the #1 hotel chain in the Philippines and Top 3 budget hotel chain in Southeast Asia. ZEN helps budget & mid-range hotels operate more efficiently and increase the value of their property through a range of operational & technological solutions. ZEN contributes daily to democratizing access to safe and affordable travel with millions of travelers staying at ZEN’s franchised or operated properties each year. ZEN has raised US$23M equity funding from leading institutional investors Rocket Internet, Ooredoo Telecom, RedBadge Pacific, SBI Investments Korea, and Yanolja.
Yanolja is Korea’s No.1 leisure platform leading the industry in providing travelers with real-time travel –and –stay booking services connecting them to a comprehensive database of hotels, motels, private lodgings, guesthouses, and international accommodations. Yanolja is driving innovation in the travel and tourism industry by utilizing and integrating new technologies such as IoT, AI, and AR, to offer enhanced solutions for all stakeholders involved. Yanolja will continue to develop and introduce innovative solutions that enable users to enjoy leisure most efficiently and conveniently. In June 2019, Yanolja announced a capital raise of $180M funding from GIC and Booking Holdings at a valuation of over US$1bn.