Why Kenya-based HotelOnline Acquired Hospital Software Supplier HotelPlus

HotelPlus, a software supplier with clients in 22 countries, has been bought by HotelOnline, a Kenya-based Yanolja-backed travel technology scale-up that bills itself as an e-commerce and digital marketing enabler in the hotel business.

The precise details of the transaction were not released, but Eric Muliro, who created HotelPlus in Kenya 13 years ago, would get a compensation as well as $1.9 million in HotelOnline shares, which were valued at $24 million prior to the transaction. Muliro will also serve as HotelOnline’s chief technology officer.

Why The Acquisition 

HotelOnline stated that the transaction boosted its client base by over 2,200 and opened the way for new consumers and innovative capabilities such as payment solutions, AI-driven pricing, and revenue management.

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“We are significantly increasing our client base, while capitalizing on the combined strengths of both companies, creating a force to reckon with in East Africa’s hospitality industry,” HotelOnline co-founder, said. 

“Because the HotelPlus client-base currently uses on-premise software, this creates a unique integration opportunity with our cloud solutions…We are creating a massive win-win situation for the HotelPlus clients, in other words,” said Bauck, who co-founded HotelOnline with Endre Opdal in 2014.

Trond Riiber Knudsen of the TRK Group, an Oslo-based venture capital firm and an investor in HotelOnline, said in a statement, “A deal like this helps build a strong African travel-tech player, with a local and continental foothold. This is a key part of what we aim to contribute to through our stake in HotelOnline. We see great potential in the new company, and we look forward to the journey from here.”

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The transaction comes months after HotelOnline concluded a Series A fundraising round led by Yanolja earlier this year, a first in Africa for the SoftBank and Booking.com-backed South Korean travel technology startup. Yanolja, which has over 43,000 clients in 170 markets, provides cloud-based solutions for lodging, restaurants, and residences.

With Yanolja’s backing, HotelOnline now has the financial clout to strike partnerships and make investments that will help it develop and expand in its current and target countries. Tore Hofstad, Stratel AS, and a group of Nigerian angel investors are among HotelOnline’s other investors.

Kenya's HotelOnline acquires hospitality software company HotelPlus |  TechCrunch
Credits: HotelOnline

A Look At What HotelOnline Does

HotelOnline assists hotels in establishing and increasing their internet exposure in order to reach a larger consumer base. It assists its clients in deploying booking engines and increasing their visibility on distribution channels like as Booking.com, as well as arming them with the ability to manage operations on their own platforms utilising cloud-based digital tools such as property management systems. It also provides property management services to owners.

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HotelOnline stated that it intends to aggressively expand across Africa, where it presently has over 6,000 clients distributed across 27 countries, by using HotelPlus’ reseller network and the burgeoning hospitality business, which is rebounding successfully from the pandemic’s ravages. Its immediate strategy is to establish a dominant position in East Africa, as well as in Nigeria and Senegal, as it strives to become a big pan-African powerhouse.

“HotelPlus has built an impressive commercial organization, with skilled sales people, a high-performance reseller network covering more than a dozen countries across the continent. Integrating these resources, prepares the ground for our accelerated expansion in Africa,” said Bauck.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. 
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexpert

South Korean Unicorn Enters African Market, Invests In Kenya’s HotelOnline

Havar Bauck is the Co-Founder of Hotel Online. Next to him is Endre Opdal, the Co-Founder and current CEO of Hotel Online. Source: HotelOnline

Yanolja, a South Korean travel technology company valued at more than US$11 billion, has realized its ambition to enter the African market by investing in Kenya’s HotelOnline.

This is not only their first investment on the continent, but also the first investment in the travel technology business by a Korean corporation in recent years, paving the way for other Korean companies to investigate potential in Africa.

“This is a game-changing moment for HotelOnline. With our operations back in break-even after the Covid crisis, this investment puts us in a unique position to scale and expand aggressively, strengthen our position in current markets, and expand our operations into more target countries. Backed by this investment, we can seize more of the present opportunities to drive the transformation of travel and hospitality in Africa. Our partner hotels are already surfing on the recovery waves,” co-founder and CEO Endre Opdal of Yanolja said in a statement. 

Havar Bauck is the Co-Founder of Hotel Online. Next to him is Endre Opdal, the Co-Founder and current CEO of Hotel Online. Source: HotelOnline
Havar Bauck is the Co-Founder of Hotel Online. Next to him is Endre Opdal, the Co-Founder and current CEO of Hotel Online. Source: HotelOnline

Why Yanolja Invested

The acquisition of shares in HotelOnline for an unknown sum enables the Asian travel company to conduct business in Africa and implement its travel-related SaaS (Space as a service) technology. 

This investment is part of the $1.7 billion raised last year by the Korean startup from SoftBank Vision Fund 2, one of the largest technology-focused investment funds in the world.
Yanolja is slated to list on the NASDAQ in 2023 and is backed by Booking.com, the world’s largest travel company.

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Jongyoon Kim, CEO of Yanolja Cloud, has been vocal about the importance of partnering with a large African travel company, and the effort appears to have been successful.

“We decided on this investment, considering the synergy of two companies proved from the previous partnership with HotelOnline, the African hospitality leading company. As an AI-based SaaS company that offers the solutions for the spaces, we won’t stop cooperating for the digital transformation of African space (spatial) business including hospitality through marketing-leading AI and cloud technology,” he said.

A Look At What HotelOnline Does

HotelOnline, founded in 2014, is Africa’s foremost e-commerce and digital marketing facilitator for hotels, and a catalyst for the continent’s hospitality industry’s digital transformation. Through a combination of digital marketing, distribution, and simple digitization of fundamental operations, the company has assisted over 5,000 hotels in 27 African nations in increasing their revenue.

HotelOnline announced the cooperation with Yanolja, with co-founder Havar Bauck remarking that Yanolja Cloud chose to invest in HotelOnline in order to accelerate the growth of its worldwide solution business for spaces in Africa.

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“Today is a great day, not just for Yanolja and HotelOnline, but for the entire travel and hospitality industry in Africa. As travel rebounds, we are in a strong position to help our hotel partners capitalize on the recovery, by attracting more local and international travellers, increasing occupancy, and getting more revenue. We have partnered with Yanolja since we started, through their subsidiary, eZee Technosys, which is now our main technology partner, ” Havar Bauck said. 

Havar agrees that Yanolja’s investment occurred at a critical point in HotelOnline’s turnaround. “It was a lengthy and arduous procedure that lasted over ten months. By the time the process was complete, we were already on the verge of breaking even.”

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. 
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh