Tujia’s online unit receives $300 million funding, backed by Ctrip
Chinese accommodation sharing firm Tujia announced that its online platform has closed $300 million E round funding, following the separation of Tujia’s online and offline departments.
“For this round, our online platform business raised USD 300 million, at a valuation of over USD 1.5 billion. The lead investors were Ctrip and All-Stars Investment, with China Renaissance’s New Economy Fund, Glade Brook Capital, and G Street Capital also participating in the round,” said Jun Luo, founder and CEO of Tujia.
The round came as the first independent financing since the separation of Tujia’s online and offline departments.
In his internal message, Mr. Luo revealed that Tujia has maintained steady growth in its business since the D and D+ rounds of financing in August of 2015. He said the funds raised from this round would be used both to “work towards optimizing the user experience by standardizing aspects of our alternative travel accommodations such as linen washing, cleanliness, and smart capabilities,” and to “further invest in the domestic high-end real estate market and in foreign markets.”
Ctrip’s Co-Founder and Executive Chairman of the board, James Liang, said: “The change in Chinese attitudes toward consumption has been accompanied by the continuous improvement of short-term alternative accommodation products. The domestic e-accommodation sharing market resembles Airbnb and similar enterprises in its rapid growth, becoming in just a short time an essential part of the travel accommodation industry.”
Tujia is a worldwide accommodation booking platform. Since launching on December 1, 2011, it has grown to cover 345 domestic destinations and 1,037 foreign destinations, with over 650,000 online listings, in the span of just 5 years, becoming China’s largest provider of alternative accommodations.
Tujia has integrated three accommodation booking platforms: The homestay businesses of Ctrip and Qunar, and Mayi.com. Tujia has also worked with eLong, WeChat, Baidu, Tongcheng and other partners to build a strategic, cooperative distribution network. Furthermore, Tujia has signed contracts with 218 government agencies and reached strategic cooperation agreements with a large number of domestic real estate developers, including over 1 million units of accommodation.
Since the second half of 2016, Tujia has been focusing on integrating and expanding booking platforms for various domestic mainstream online accommodation reservation platforms. In 2016, Tujia saw a breakthrough in the number of its online listings through its merger with Mayi.com. In 2017, with the integration with Ctrip Homestay and Qunar Homestay, Tujia’s online traffic, user number, and revenue made a further leap.
Tujia has achieved exponential gains in the domestic market, with transaction volumes growing over 300% year-over-year. Internationally, especially in Asia, Tujia has grown exceptionally, increasing fivefold this year.
On the eve of the 2017 National Holiday or “Golden Week,” Tujia released its “Tujia Mansion” product, which received unprecedented positive responses and saw transaction volumes during the Golden Week exceed the previous year’s by 400%. With an average nightly price for a single room exceeding RMB 3,000 and the most expensive room at RMB 45,000, “Tujia Mansion” demonstrates the growing demand for luxury offerings by high-end customers. Following the introduction of the “two-child policy,” Tujia is best positioned to capitalize on the increase in demand for family-friendly accommodation options.
As of August 2017, Tujia’s app has already been downloaded by over 180 million users, with several hundred thousand customers making booking inquiries every day. Users of Tujia’s online platform have given the app an average satisfaction rating of over 4.6 (out of 5), and 98% of users expressed in their feedback that they would return to a Tujia property in the future and would recommend it to their friends.