A start-up that uses machine learning and dynamic pricing to maximise hotels’ revenues and occupancy has secured £2.5 million in seed investment.
The cash injection into London-based Pace was led by InterGlobe, with participation from Seedcamp, Speedinvest and Amadeus Capital Partners.
Pace, founded last year, claims to be the first company to fully automate pricing so that it responds to demand and price sensitivity, and ensures that every room is consistently sold at the optimum price.
Its dynamic pricing software means that hotels can respond immediately to changes in consumer demand and price elasticity.
Pace changes hotels’ prices at least 500,000 times a year through automated, real-time market intelligence, helping them to increase revenues by more than 10% on average.
Targeting boutique and independent hotels, the company is working with 20 properties across five markets, including innovative brands such as Prague’s Emblem Hotel and Teleport Hotels in Amsterdam and The Hague.
Pace was co-founded by Jens Munch, John-Paul Clarke and Jason Pinto, who share deep experience optimising airlines and financial systems through machine learning.
CEO Munch said: “Static and inefficient pricing has held hotels back for too long.
“Drawing on research from finance and aerospace, we want to raise the bar for revenue management and help hotels sell every room at the optimum price. We’re excited to announce this investment, which lets us expand our science and engineering team and give hotels the solution they deserve.”
Neena Gupta, executive director – strategy at InterGlobe, said:
“Businesses across the travel industry have been constantly seeking smarter technological solutions to enable robust price management.
“The talented team at Pace has demonstrated that a tech-enabled automated approach has the potential to revolutionise the industry. Pace will lead the way in transforming revenue management not only for the hospitality industry but also for other relevant industries.”
Seedcamp managing partner Carlos Espinal said: “Waste in any industry is a bad thing, particularly in the travel industry where it involves many services that are interdependent and where customers end up footing the bill for poorly optimised travel and hospitality options.
“By backing Pace, we hope that the industry will have a new tool to take a step in the right direction and reduce the friction of over and underbooking and the negative impact it has to us all.”