Vietnam Business Channel

Vietnamese Airbnb startup raises $3 million USD from venture capitalists

Vietnamese homestay platform Luxstay has raised $3 million USD from CyberAgent Ventures and other foreign investors in its bridge round. Representatives of Luxstay said the total capital raised could rise to $5 million USD, as negotiations are still ongoing with interested investment funds.

CyberAgent Ventures (CAV), a Japan based investment firm specializing in incubation and investment in early-stage companies, played a leading role in directing the structure and execution of this funding round, the third for the firm after the seed and pre- Series A rounds. This is also the second time the firm has injected capital in Luxstay, after its initial investment in the company’s pre-Series A round in early 2018.

Dzung Nguyen, Managing Director for CyberAgent Vietnam and Thailand, believes that the "sharing economy" is a development trend in many business areas, and it will impact both tourism and real estate markets.

Nguyen said: "We believe the Luxstay model capitalizes on this trend, and will create a major impact on the market in the coming time."

Luxstay was launched in 2016 and is a short-term rental-booking platform for apartments, villas and other homestay accommodations positioned in the mid and high-end segments of Vietnam’s real estate market. The company says that it currently has a network of nearly 10,000 properties across Vietnam

The company is a pioneer in building a platform allowing Vietnamese homeowners to participate in the rental market and has created new accommodation options for both business and consumer travelers.

According to Luxstay, there may be millions of apartments, condominiums, holiday villas and townhouse that are willing to participate in the short-term accommodation market. Therefore, the company has targeted having 200,000 ~ 300,000 individual properties participating in its home-sharing platform over the next 5 years.

Nguyen Van Dung, the founder of Luxstay said that with the current development speed and market potential, Luxstay will focus on accumulating resources to speed up technological development towards building an ecosystem for this new industry.

Luxstay had received attention from foreign funds in its previous venture rounds. According to Crunchbase, an online database on investment activity, Luxstay raised $500,000 in its seed round in June 2017 from Vietnam-based ESP Capital and Japanese Genesia Ventures and another $2.5 million was raised in May 2018 in its pre-Series A round from CyberAgent Ventures (Japan), Genesia Ventures (Japan), ESP Capital (Vietnam) and Nextrans (South Korea).

In September 2018, the startup became a Vietnamese strategic partner of Rakuten Travel, the tourism branch of Japanese e-commerce giant Rakuten. Y1 Venture and other firms were also involved in the bridge round. Luxstay has said that it plans to continue its expansion and will seek new investors for its next Series A round in mid-2019, with a potential scale of $10 million USD.