Transforming the aparthotel concept through technology: Turbulence interview with Sweet Inn CEO Paul Besnainou.
About Sweet Inn: Founded in 2014, Sweet Inn aims to close the gap between hotel and short-term rentals. To achieve their goal, they use a combination of tech and established hospitality management to provide travelers with unique holiday apartments with all the comforts of boutique hotels. Based in Paris and Tel Aviv, they operate in nine cities across Europe and Israel.
About Paul Besnainou: As CEO of Sweet Inn, Paul is on a personal mission to turn the company into a “hotel spread throughout the city.” Having been at the helm of the company since its founding, he continues to oversee the company’s non-stop growth.
Turbulence: How did you get into the travel sector? What was your background before founding Sweet Inn?
Paul Besnainou: I had no particular connection with the world of tourism beforehand. I’d just been lucky enough to travel all over the globe with my family and to stay at top hotels. However, despite the unique settings and comforts offered by these hotels, something about my travels felt inauthentic. That’s where the Sweet Inn concept came from: enabling travellers to enjoy a local experience while still benefiting from the standards and perks of high-end hotels.
Our customers don’t want to be seen as mere tourists anymore. Likewise, they no longer want to have to continually report to the front desk, hang out at the hotel bar or be surrounded by fellow travellers in adjacent rooms.
Getting to know and exploring the world through a local experience is the crux of what is a fully-fledged revolution. Sweet Inn and I are not the instigators of this revolution: the trailblazers were obviously Airbnb, but the options available through their platform does not cover all the bases. Indeed, if you’re accustomed to specific standards and amenities, plus a certain level of peace of mind, you may find yourself frustrated by the services on offer through private rentals, or even worried about what you’re going to encounter when you arrive.
With Sweet Inn, the local experience begins with the selection of apartments. Before our units hit the market, they are renovated and refurbished by our local interior design teams. Their mission is to infuse every room with the atmosphere and history of the surrounding neighbourhood. Thus, it replaces a standard hotel room wireplaced byth an apartment that has a unique personality. Accordingly, a villa near the Old City of Jerusalem will bear little resemblance to a loft on the Champs-Elysées in Paris.
Moreover, our Guest Relations Agents act as personal concierges and are on hand to provide the best insider tips about the city – the sort that only locals know.
Lastly, we put significant focus on the serenity and safety of our customers. For this reason, our on-site team are there to answer all our guests’ questions and to cater to any requests they might have. Also, we ensure our apartments like hotels and equip them all with safes so that valuables can be stored securely.
In a nutshell, it’s about offering the best of both worlds: a local experience with quality services guaranteed.
Airbnb initially offered accommodation in homeowners’ main residence, thereby majorly contributing to the development of the ‘sharing economy.’ Who owns Sweet Inn’s properties? The company itself, other businesses or individuals?
Like many large hotel chains worldwide, we don’t own our properties but operate them on a very long-term basis. In other words, we lease our apartments and manage them independently and exclusively. This total control over our portfolio ensures we can offer the highest quality standards and provide a hotel-like touch in all our apartments.
You are internationalising at a breakneck pace. Despite being a very young company, Sweet Inn already offers nine destinations and eight payment currencies. Is internationalisation a priority? How do you manage internationalisation when your headcount is still relatively limited?
Paul: We currently have apartments in nine cities and are in the process of launching in London, meaning we’ll end the year with ten towns under our belt. Next, in 2018, we’ll roll out in Berlin and Amsterdam. After that, we’ll have to decide as to whether to continue our growth in Europe or to take a brief break, before expanding into Asia or the United States.
Regarding this international development, we have lean operational and financial structures. On the other hand, our commercial, marketing, data and IT teams – based in Tel Aviv and Jerusalem – are starting to grow and now include some 25 engineers, plus 20 or so data analysts and data scientists. At present, we’re developing several functional technological tools for a range of purposes (from big data to yield management and apartment automation systems). All that has been made possible by the $22 million funding round we closed a few months ago.
In line with this, if we want our model to be scalable, we need technology to power our operations, sales, marketing and pricing. We’ve got to streamline and automate our processes. For instance, we’re developing technology for a keyless entry system, which works on passport verification. Payments are going to be automated, too. The idea is that our Guest Relations Agents will no longer waste time dealing with low-value-added tasks and instead will be able to focus on the local experience, which is where they can offer our customers genuine added value. This automation and the implementation of technological and digital infrastructures are essential to really enhance the guest experience.
Payments are a pain point for many OTAs, especially when they involve transactions in various currencies. How do you handle that? Do you favour a technological approach to this, too?
We would be able to operate in 20 currencies on our site if we ever wanted to. We use a highly sophisticated Israeli technology platform to manage payments, refunds and deposits. Our technology team has real pedigree: for example, our CTO is the former CTO of GetTaxi. As you know, one of the most significant challenges for transport applications is managing payment systems, so we’ve got considerable expertise in that area.
The industry’s most thriving players are either in the high-end space or offer tailor-made services. Do you feel these two subsectors alone represent the future of the travel industry? And how do you set yourselves apart from your competitors?
We don’t seek to set ourselves apart on that front. We aim to offer a unique, local experience with ultra-personalised services, but not necessarily luxury ones.
If you want a private chef, breakfast delivered to your door and a chauffeur, you can have that, and you’ll pay more for it. But if that’s not what interests you, you will find nightly rates to fit your budget.
A question about your location. You spoke before about Tel Aviv, which is renowned as a technology powerhouse. Can you give us a brief overview of [your relationship with] Tel Aviv’s tech ecosystem?
Our CTO spent four years as the CTO of GetTaxi in Tel Aviv, while our new CRO – who joined us a month ago – was the number two at Google Israel, and our VP Biz Dev filled the same position at Moovit for five years. Moovit is the world’s top transit app, with 90 million users across more than 1,500 cities. It helps people to get from A to B on public transport by showing them the fastest route. Being in Tel Aviv means that you have major tech leaders on your doorstep and allows you to attract talent that might have gone elsewhere in the past. It’s not for nothing that Israel is known as a ‘start-up nation’.
You’re growing both organisationally and culturally, and recently raised more funding. How do you go about managing that process? With offices and subsidiaries dotted across the world, how are you building a distinctive Sweet Inn culture during what is a period of major growth acceleration?
We’re entering the 2030 era and I no longer believe in companies having a national identity, nor in the idea of borders. The likes of Jerusalem, Tel Aviv, Paris and London are all melting-pot cities.
Having said that, there’s one thing I’m sure of: CEOs must surround themselves with a team of energetic and determined managers. That’s the only way to ensure that strategic decisions taken by the company gain traction throughout the different areas.
In general (and this is a question we’re asking all of our interviewees), what do you see as the biggest challenge facing tourism and the travel industry today?
In my opinion, two factors stand out. The first is the consolidation of the market, with bigger companies snapping up smaller ones. The days of ‘amateurs’ with Airbnb listings are numbered. The second is the necessary speeding up of product development and time to market through technology and the digitalisation of all processes. This outlook is spreading across the travel world. As Sébastien Bazin put it when talking about the future of tourism, “If you get left behind technologically and fail to embrace the digital, you have no future.” I agree with that sentiment.