US: Furnished flexible rental operator Blueground has announced that it has raised $45 million in a Series D funding round to continue its expansion strategy.
The funding round was led by private growth equity firm Susquehanna Private Equity Investments, with participation from other backers, including WestCap, whose managing partner, Laurence Tosi, is a former CFO of Airbnb and an investor in Sonder. Blueground has also secured a debt facility from Barclays with participation from Morgan Stanley, Deutsche Bank and HSBC, which replaces and upsizes the $40 million debt facility which the company obtained from Silicon Valley Bank [prior to its collapse last year] three years ago.
As the company defies the current challenges in the fundraising environment, Blueground aims to use the funding to accelerate the development of its technology and strategic initiatives, as well as to integrate its most recent acquisitions, as it targets a potential initial public offering [IPO] in the future.
Alex Chatzieleftheriou, co-founder and CEO of Blueground, said: “We’re thrilled to welcome new strategic investors who share Blueground’s vision of enabling flexible living on a global scale. The trust from leading investors like Susquehanna and reputable banking institutions like Barclays, and the syndicate banks, is a testament to Blueground’s financial performance and global leadership.”
Dean Carlson, head of digital assets at Susquehanna, said: “Blueground has emerged as the global leader in furnished, flexible apartments for 30+ day stays with its ability to operate profitably in this market and continuously improve financial performance.”
Flexible lifestyles remain highly sought-after worldwide, catering to the needs of both individuals and corporate travellers in their professional and personal endeavours. As global citizens seek greater control over their living arrangements, the demand for consistent and convenient housing options has surged, and Blueground aims to play a pivotal role in meeting those flexible living needs seamlessly.
Blueground closed its $180 million Series C funding round in September 2021, which included $140 million in equity funding and gave the company a reported valuation of $750 million. For the time being, the company is not disclosing its current valuation, but Chatzieleftheriou told TechCrunch that it has increased since the previous round.
Since then, Blueground has made a number of notable acquisitions to increase its global and domestic footprint, including Brazilian furnished apartment rental operator Tabas in November 2022, Denver-based on-demand housing provider Travelers Haven last February, and monthly furnished housing provider Nestpick in May last year. Further purchases in the future are expected as industry consolidation continues.
In the meantime, competing urban operators such as Zeus Living, Frontdesk and WanderJaunt have also ceased operations due to funding concerns and challenges with rising interest rates.
Founded in 2013, Blueground claims to operate the largest curated global network of furnished rentals for 30+ day stays for individuals and corporate clients alike. Chatzieleftheriou established the business after experiencing first-hand the pain points of living out of hotels while travelling for work for months at a time.
The company has now expanded its portfolio to managing 15,000 units in 32 cities across 17 countries, catering to both individuals and over 4,000 businesses, including a number of Fortune 500 companies. In addition, Blueground has signed major franchise deals over the last 12 months, including partnering with Mitsubishi Estate to launch Blueground Japan last March, and expanding into Thailand through an agreement with Chic Republic Public Company Limited, as well as other agreements in Cairo [Egypt] and Prague [Czechia].
Last year, the New-York based operator generated $560 million in revenue – a 70 per cent uptick on 2022 – and it adds that it is on track to achieve $1 billion in revenue within the next two years.
