Roomstorm travel disruption
8 months ago
 

Startup pitch: Roomstorm is literally a travel disruption startup

Many startups claim to be experts at disrupting the travel industry, but Roomstorm is one of the rare startups focusing on helping the industry handle old-fashioned disruption in flight and hotel operations with the latest software solutions.

The problem is large: Millions of passengers in the US alone get stuck at airports at night because their flights have been cancelled or postponed. Similarly, more than 12,000 travelers were “walked” from US hotels last year due to overbooking.

Enter, Roomstorm. The startup tries to address the “irregular operations” problem. It aims to save airlines and hotels hassle and heartache by providing instant access to extra hotel rooms.

Perhaps the startup’s most robust credential is that in 2014 it was accepted by Y Combinator, a firm that invests in startups and helps them to expand and that — in travel — has leveled-up Airbnb, Hipmunk, and GetGoing.

Here’s a one-minute video pitch by Roomstorm’s founder Maksim Izmaylov

And here’s a brief Q&A with Izmaylov:

What problem does your business solve?

Roomstorm has a few tiers of customers.

Airlines benefit from our products, because in case of an IROP (flight cancellation, delay) they no longer need to call each hotel individually and request rates and availability from them. Instead, they have all that information on the dashboard and they can book a room within 30 seconds.

We’ve also created a patent-pending feature that allows airlines to accommodate hundreds of passengers within five minutes, at the same time allowing the passengers to have the highest level of control in terms of the choice of hotels.

Hotels also have the ability to buy accommodation from other hotels in the area when they need it. With Roomstorm, both airline and hotel customers no longer have to deal with invoicing and paying hundreds of hotels individually.

Instead, they can reconcile all the bookings on our platform and get paid by Roomstorm automatically or submit their payment for the bookings they have made.

Most importantly, we are helping travelers. We’ve all been on delayed and cancelled flights. Have your flight ever been rerouted? Perhaps you’ve missed your connection and now you need a hotel room. You would be surprised, but many airlines still use phone, pen and paper to book accommodation for their passengers.

Hotels’ process for finding accommodation for their guests is exactly the same: pick up the phone, call around, etc. For the passenger it sometimes mean that you have to wait for hours before they are able to check in and get some much needed sleep after all the stress that accompanies situations like that.

At Roomstorm we’ve already helped thousands of airline passengers and hotel guests to save time and, of course, their sanity.

Names of founders, their management roles, and number of full-time paid staff?

Maksim Izmaylov – CEO
Jakub Vysoky – CTO

Number of full-time paid staff: 5

Funding arrangements?

We’ve raised $1.1M in 2015, after going through Y Combinator.

Revenue model?

We charge the buyer a 7-10% fee. There are no other costs: no onboarding fees and no monthly recurring fees.

Why do you think the pain point you’re solving is painful enough that customers are willing to pay for your solution?

Each airline or hotel agent knows the pain of trying to find accommodation for their guests, when things don’t go according to the plan.

Imagine a cancelled flight and two airline agents calling hotels around the airport at 10pm. Looks of the passengers impatiently waiting to finally get some rest.

For airlines, it’s also hard to find a solution for IROPs that would work anywhere in the world. At Roomstorm we’ve solved that problem. We have access more than 300,000 hotels across the globe.

Roomstorm also eliminates a whole range of problems around booking reconciliation and accounting.

External validation?

We went through the prestigious Y Combinator program in 2014 and we have a few high-profile customers (more information on roomstorm.com).

Tnooz view:

When travel goes wrong, it can go spectacularly wrong.

Technology can help make it smoother for airlines and hotels to recover by automating the information-sharing, the manual data-re-entry as part of rebooking, and the paperwork and faxing (faxing!).

Roomstorm isn’t alone in trying to tackle this category of problem. But it has a significant head start on its competitors (such as one effort being mentored at Travelport Labs) and Boston-based Freebird.

A potential paradox that Roomstorm faces is that the airlines and hotels most motivated to address this problem may want to build in-house solutions instead, while the rest may not be willing to spend the money on a solution and prefer the cheapskate approach of complacency.

In other words, while the problem is real, airlines and hotels may not be motivated to solve it.

Roomstrom is testing a thesis. For its sake, we hope it’s right and that there is sufficient demand by travel brands for tools like the ones it offers.

We have confidence in its team. We first met Roomstorm founder Izmaylov when he was part of a team that won one of our travel hackathons at San Francisco Airport in 2014. We’ve been impressed by his knowledge, both technical and business-wise. We’re eager to see what’s next for his company.

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Sean O'Neill

About the Writer :: Sean O'Neill

Sean O’Neill had roles as a reporter and editor-in-chief at Tnooz between July 2012 and January 2017.

 

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