Impact of the pandemic on business too much to bear for US upmarket curated-rentals startup
Short term rental operator Domio is to cease operations as it failed to raise the necessary capital to stave off the effects of the global pandemic on its curated rentals business. Launched on a wave of optimism for the short term, high-end rentals business model back in 2016, the company has faced one grueling decision after another as it was forced to let go most of its staff earlier this month and was reportedly forced to put an apartment block for which it had a 10-year lease for up for sale at a firesale price in October.
Hopes were high for Domio and many other startups in the space back in August 2019 as the New York-based firm raised $100 million in a Series B round participated in by GGV Capital and Softbank NY having tripled its revenues since its previous funding round. The money was destined to secure leases of city center apartment complexes which were refurbished and made into curated rental spaces aimed at affluent digital-nomad millennials.
The bad news for Domio follows similarly catastrophic news for fellow upmarket short term rentals companies Lyric, which also announced its shuttering this week, and HubHaus, which was forced to close in September. Despite Airbnb, the big brother of these companies, being about to debut on the open market to much fanfare and speculation, the reality is that there seems to be little appetite for living in managed and often shared accommodation at a time of airborne pandemic and little room for error for companies offering short term rentals full stop.