Following the recent announcement of an additional $110m of funding, Hospitality Investor spoke to Matthijs Welle, the CEO of hospitality cloud provider Mews.
During the interview, Welle said that Mews is currently making preparatory integrations for two global hotel brands, with rollout of Mews systems at property level expected later this year.
Hospitality Investor: What’s Mews doing in the US market?
Matthijs Welle: We entered in 2019 and Covid happened so in the last two years we’ve had to rebuild the team. We now have 75 people on the ground who are actively selling. We are seeing good success with larger independent hotels, and we just signed a good chain hotel which will give us some strong brand exposure. It’s a much earlier stage in the US because in Europe we’ve been screaming from the rooftops for 12 years and everyone is aware of us. In the US we have a lot of work to do and that’s why we need acquisitions and we just bought Frontdesk Anywhere, a US-based cloud system which is another acquisition that we need to get our brand out aggressively.
HI: Is it your goal to partner with the global hotel brands?
MW: That’s definitely the dream. Some of these brands are bigger than we are today, so we’re working hard at making sure the platform can scale to that size and that it has loyalty integrations. We’re very actively working on several loyalty integrations. We’re working with two major hotel brands right now to finish the integrations to their central reservation systems.
HI: So you’re already preparing the groundwork.
MW: Absolutely. We have to prepare the groundwork for enterprise scale because it’s such a long sales journey with these brands. We’ve been talking to them for years already and we’re waiting for the right moment to get to rollout.
HI: Two global hotel brands?
MW: Yes, we’re building already. The most important thing with the big global brands is integrating with their CRS. That gives you access to the loyalty programmes and central reservation flows, so we now have teams currently building the integrations which should complete by the end of June, most likely. And then we’ll be able to actively onboard their hotels. [The two brands we are working with] are ranked in the top twenty hotel brands in the world.
HI: You’ve said you’re at a tipping point in several markets. What kind of tipping point and which markets?
MW: What we’re starting to see is very traditional hotel brands in markets like Germany and France who wouldn’t necessarily have looked at a modern young cloud product like us, they would have always gone for the very traditional legacy platforms and suddenly – I’m at ITB Berlin right now – they are all coming to our booth.
Once you start seeing those brands coming on, that’s when we get real market penetration that we’ve seen already in Benelux, which is a much smaller market obviously. In the early days of Mews people were like: “Well you’re just a startup and we don’t know if you’re funded.” That’s why this latest funding announcement is so important. It proves we have legitimacy and investors are saying Mews is the one that clearly seems to be winning, so that legitimacy allows us to sign bigger and more mature customers.
HI: You’ve made eight acquisitions of smaller tech firms and PMS providers. Last year you bought Hotello, a PMS provider in Canada. What happens when you acquire these companies?
MW: We see this huge fragmentation in hospitality, a mix of young cloud systems that aren’t surviving or legacy platforms that are slowly dying off because they have to move into the cloud, and they have to make a big decision on whether they rebuild everything in the cloud themselves or they find a buyer for their business who will take care of the team. And that’s basically what we solved there. We found a fantastic team at the Hotello operation and basically, we took about two to three years to help move their customers onto Mews so the goal really is consolidation.
It’s part of our go-to-market strategy and what we saw in Canada - where we never actively sold before - is that since the acquisition, we have signed almost as many organic deals just from people coming onto our website.
In a market where we have strong penetration, like Benelux, where one in four rooms are managed by Mews, you see that naturally hoteliers will always consider Mews if they’re changing their PMS.
In a brand-new market, like Canada, we’re trying to fast-track our market penetration, and [acquisition] is just one of the many strategies we have.
HI: There are circa 300 PMS firms around the world. Do you anticipate more acquisitions?
MW: Oh absolutely. We’re hoping to really accelerate the migration into the cloud because it’s only when you get into the cloud that the other startups around us benefit. We’ve got a massive marketplace around us. All these young startups want access to hotels but if you want to deploy an AI chatbot in your hotel today, you can’t if you have a legacy platform. It just won’t integrate. So, through us moving all these hotels onto Mews it suddenly gives access to this whole startup community around us which is really exciting.
HI: There’s a choice of 1,000 integrations in your marketplace. That’s a lot. Is there a need for more standardisation in the industry?
MW: If you’re a small hotel, you might not want a heavy-duty RMS like IDeaS or Duetto but you might want a really nice local RMS, so the more integrations we can offer, the better we can target the different segments of customers with the right solutions. We’re not big believers in all-in-one. I think it’s important that we give the choice to hoteliers. What we need to do is to help hoteliers make the choice, so one of the things we’ve introduced this year is what we call Mews Stack. Okay, so you’re a 30-bedroom hotel in the countryside; this is the ideal tech stack you need. Or you’re a group of ten city centre hotels; this is the tech stack you are looking for. So really it’s to help and educate.