A Q&A with Love Home Swap co-founder and CEO Debbie Wosskow. The London-based startup, a global home exchange club for travelers, closed a £1 million Series A funding round from MMC Ventures at the end of September. It brings the company’s total funding to £2.65 million, all from MMC. Love Home Swap was founded in 2009 by Debbie Wosskow, Ben Wosskow and Simon Walker.
SUB: Please describe Love Home Swap and your primary innovation.
Wosskow: Love Home is the world’s largest home exchange club, with 46,000+ inspiring homes available to swap or rent in 150 countries around the world. The site launched in 2011 with only 250 properties—mainly friends and family—and has rapidly grown in size as more-and-more holiday-makers look to stay in homes, not hotels. Our main innovation has been to shake up the sleepy home exchange sector—and quickly build a business of significant scale and value.
SUB: Who are your target markets and users?
Wosskow: We have three main target audiences: families, empty nesters, and second home owners. Our users are generally based in big cities and popular holiday destinations around the world, where you’d want to go on vacation. So we score highly in the likes of New York, London, and Paris, and vacation destinations such as Tuscany, Bali, and Nantucket.
SUB: Who do you consider to be your competition, and what differentiates Love Home Swap from the competition?
Wosskow: Other home exchange sites are definitely part of our competition. We feel that the scale of our ambition and the way we’ve looked to innovate on product, brand and marketing helps differentiate us here. We firmly see ourselves as part of the wider travel mix too. So, we’re competing for people’s vacation time with hotels, vacation rental sites like HomeAway, and peer-to-peer rental services such as Airbnb and HouseTrip.
SUB: You just announced that you’ve raised £1 million in Series A funding. Why was this a particularly good time to raise additional funding?
Wosskow: We’re definitely benefiting from wider investor interest in the non-hotel travel sector at the moment, as this fast becomes a multi-billion dollar industry. The fact that we’re taking a different spin on this model from other businesses that are out there has definitely helped on the fundraising side—as well as the traction we’ve been able to achieve so far in terms of revenue and portfolio growth.
SUB: How do you plan to use the funds?
Wosskow: We’re planning to use the funds to roll out our new ‘Swap Points’ scheme—a first for the social travel sector. Swap Points will make arranging trips even easier for holiday-makers through our site. Love Home Swap members will no longer need to match exact dates and destinations with each other. They can now pledge time in their property to a central bank. In exchange, they receive points that they can redeem to stay in other members’ homes or vacation homes around the world for free—without the cost of hotel bills to worry about.
SUB: What was the inspiration behind the idea for Love Home Swap? Was there an ‘aha’ moment, or was the idea more gradual in developing?
Wosskow: The site was inspired by personal experience. I’ve always loved to travel and used to be a boutique hotel addict. However, that all changed when I had kids—hotels no longer made sense, and cost a fortune. What I really wanted to do instead was take my own home and transplant it somewhere else where I wanted to travel. I’d seen the film The Holiday—the home swap rom com with Kate Winslet and Cameron Diaz—and thought this must exist in real life. But I was surprised to see that the sites that were out there weren’t very inspiring. Hence Love Home Swap—I was convinced that we could quickly innovate and build the biggest business within this category, which is what we’ve been able to do.
SUB: What were the first steps you took in establishing the company?
Wosskow: We Seed funded the business ourselves to get the company started until we reached sufficient scale to raise VC funding. I’d always recommend this as the route to go for other entrepreneurs looking to start up their own business.
SUB: How did you come up with the name? What is the story or meaning behind it?
Wosskow: We wanted to come up with a brand that was descriptive but also warm and engaging—which is what I hope we’ve been able to do as Love Home Swap.
SUB: Do you have plans to seek additional outside funding in the near future?
Wosskow: We’re not actively looking to do this at the moment, but we’re always open to having interesting conversations at any time.
SUB: What have the most significant challenges been so far to building the company?
Wosskow: Building critical mass is always a challenge with a marketplace business like Love Home Swap. Things become a lot easier with scale.
SUB: How do you generate revenue or plan to generate revenue?
Wosskow: We have four main ways of making money on Love Home Swap: swap, rent, points, and selling extra travel services such as insurance and concierge. We generate revenue from both subscriptions and transactions as part of our model.
SUB: What are your goals for Love Home Swap over the next year or so?
Wosskow: We’re planning to double revenues and members over the next 12 months; and we’re seeing our new Swap Points scheme as a game-changer for the business and the way people travel.
Love Home Swap – www.lovehomeswap.com