HN Explorer

Apply HN: Siris Rooms – African Hotel Chain

20 points by wamboga ↗ HN
Millions of Africans travel everyday, most of whom are on a budget. The average expenditure per head is between US $5 and $15, which makes even Airbnb's listings in Nairobi, an expensive choice for most. The budget hotels they are forced to stay in, however lack facilities required for basic comfort; some have dirty linen and mosquito nets (we're in the tropics), difficult check in/out and payment processes, insects and at times no water for your morning shower. ( www.booking.com/hotel/ke/sentrim-680.en-gb.html)

Then Comes Siris, a tech based hotel chain developing in partnership with hotel owners, in a uber-like model. We partner with hotels to offer us exclusively, a percentage of their inventory, which we brand and sell as Siris Rooms through offline and online channels. We offer these hotels guests their first predictable hotel experience, while helping hotels sell unused inventory, in Kenya hotel occupancy is at 45%.

About Us.

We are friends and students of CS and engineering at University of Nairobi, and we are building Africa's largest hotel chain out of the iHub ( https://en.m.wikipedia.org/wiki/IHub )

27 comments

[ 3.2 ms ] story [ 79.6 ms ] thread
afrancis
I am not sure how your model differs from online Hotel companies in North America? By "Uberlike" do you mean surge pricing? More questions. Do you know if Airbnb have problems booking rooms in Africa? What is the vacancy rate of a "good" hotel? I suspect answering these questions give insights into viability (if I am a good hotel and have low vacancy, why should I deal with you?)

A comment about title: don't equate largest with best, or most profitable (also this hotel chain does not seem to exist yet).

dang
We took "largest" out of the title, in keeping with HN's usual practice.
brudgers
The idea of a hotel network to move unused inventory has formed the basis of several "dotcom" era companies in more affluent markets, e.g. Priceline.

Reading about the Uber aspect of the project reminded me of something similar I'd read about in India, and a quick Google landed on OYO Rooms https://en.wikipedia.org/wiki/OYO_Rooms. [I'm not sure OYO is what I read about but it's the general idea]

There seem to be two orthogonal goals: resell excess inventory and sell only "high quality" rooms. One is oriented toward hotel operators, the other toward travelers. Presumably the surplus of rooms will tend to be lower quality relative to their price. Travellers want the rooms that are least likely to be surplus (high quality relative to price).

How do you see this set of competing interests being resolved in the interest of both groups to create a two sided marketplace?

wamboga
With priceline, the issues were simple, the hotels were of good quality but for our case we must standardize. On oyo,I read about them but they have focused on scale amidst issues with customers www.socialsamosa.com/2016/02/oyo-rooms-viral-consumer-rant-pandoras-box/. So we plan to launch leveraging on surplus but standardizing experience. We will derive revenue from a 10% referral fee and also charge 5% service charge for standardizing the stay
wamboga
Siris is built around my pain points and those of people close to me.It dates back 2009, when my mum got an on job promotion that increased her travels, she wanted to save something for us; a shirt for me, a dress for my little sister and occasionally shoes for my dad, we enjoyed it but she had to sleep in "good" hotels which derailed her mornings since they had no water for a morning bath. Last year, my father lost a laptop with loads of data, in a tier 2_town in western Kenya. I also travelled to Kampala, Uganda and encountered similar issues, the linen was good but their was no mosquito net, I contracted malaria. A friend of mine also had to host his dad while drunk, since his dad could not find a predictable hotel,the issues are that serious.
wehadfun
Sounds like this is a hotel quality problem not a tech issue. Siris needs to grade hotels. Lets say a hotel does not have water that is a Siris grade F. Lets say it has water but no misquito nets its Siris Grade D. Hotels must pay to be graded by Siris. In return they get a sign that states their grade and Siris markets their hotel to potential guest.
wamboga
We're using technology to build a virtual hotel chain, and will distribute inventory through our portals or through partner travel agencies. We'll partner with hotels, standardizing experience and branding them under our banner. All our hotels will give a promise of a uniform experience, so no grading is required
wehadfun
Assuming water will be part of this virtual hotel experience. How are you going to provide water in hotels that currently do not have it?
wamboga
We will ensure that hotels we partner with always have water, in Nairobi, for instance, water from local authorities is unreliable, so some hotels have boreholes, but many don't know those with these. We will standardize / ensure 5 main issues are met at partner hotels: water availability, clean rooms, diversified payment, good breakfast and access to basic amenities such as mosquito nets
astrange
Do you not plan to have ratings at all? If the maintenance is being done by the hotel staff it won't always be the same quality, and people must care about things like location as well.
wamboga
Hotel categories will surely vary because certain places are primer. We intend to have alpha rooms for backpacking, flagship and elite rooms
wehadfun
How do you control the quality of the hotel rooms?
wamboga
We intend to conduct routine checks, have a fleet on the street, and through reviews by our customers
wamboga
On the tech issue, we are developing technology around booking, Africans accessing the net over mobile is on the increase (Kenya has more mobile phones than toilets) and with hotels around inventory management via an extranet app
SherlockeHolmes
I think the idea is promising and needed. There should be a vast amount of space in the African market for this. If this is done properly, it can help generate economic activity in active regions by increasing the quality and ease of experience of people using hotels through Siris Rooms.

How long will it take you to become Ramen profitable? The traffic in Nairobi (compared to SF, for example) may not be heavy enough, requiring you to spend and expand.

wamboga
If we got to 50 guests daily, we would be ramen profitable, life in Nairobi is much cheaper than in SF. We can live in hostels at our uni, for so long as our 4 year study program is still on, it costs US $50, a year. We can also live on $2, a day for three of us' meals.
SherlockeHolmes
Ok, so you guys will be hard to kill. That's a very good quality to have for a start-up.

How will you convince the first hotel owners to start using your service? How will you find and convince the first users (you will have to choose one or two mediums in the beginning)?

wamboga
We intend to leverage on the fact that Kenya's hospitality market has had some issues the past two years and occupancy levels have dipped to about 20%. For customers we will use mainly townhalls and referrals
rom16384
How will payment work? Who will the customers pay, Siri Rooms or the hotel directly (or both)?

If the customers pay you, there's the question of payment methods or the use of payment processors.

If the customers pay the hotel, how do you collect your fees?

wamboga
We are considering both. At hotels payment has already been used across Africa. we'll just implement with modification perhaps
kumarski
What was the result of your conversations with hotels/hotel chains?
wamboga
Hotels are willing to sign up as long as we deliver on our promise. In exchange, we are getting six months to try.
alex_winters
The thought behind the idea is astounding! Quite a promising idea . what typically differentiates SIRI ROOMS from well-established and similar business models like OYO is the business strategy that we intend to use: Create an astounding hotel experience for our clientele while at the same time controlling surplus hotel inventories and selling high quality services- A business model that seeks to cut back on any arising conflicts of interest like quality room service, and the cost of providing such an experience.
wamboga
It's a great experience having Alex as part of our team. In. testimony of our pedigree, he has been admitted to UC Berkeley for a EECS degree, complete your time as a MasterCard scholar, and join us in building Africa's largest hotel chain. Fastest
wamboga
Kenya has 6million smartphones against 37 million phones. ICT cabinet secretary, yesterday announced that in order to increase uptake, there's a planned reduction on the import tax on smartphones. This is an advantage to many with a business model, Siris type. Given that most of Kenya's internet is accessed through phones, an increase in quality of it, means rosier times COOL