Executive Conversations: Dr. Patrick Andrae, Co-founder and CEO of HomeToGo
Dr. Patrick Andrae, Co-founder and CEO of HomeToGo, joins David Peller, Managing Director, Travel and Hospitality for AWS, to discuss the company’s recent initial public offering (IPO), reflections on the past year, and what innovations born out of disruptions will last well into the future. HomeToGo successfully listed on the Frankfurt Stock Exchange on September 22, 2021 under the ticker symbol HTG.
Patrick co-founded HomeToGo in 2014 with the mission to make incredible accommodation easily accessible to everyone. HomeToGo has since grown to be a global leader in the travel and short term rental industry, managing 23 local apps & websites across Europe, North America, South America, Australia and Asia-Pacific. HomeToGo also operates brands such as Tripping.com, CASAMUNDO, and Wimdu.
This executive conversation is one in a series with industry leaders, where we seek to learn more about their resiliency, tenacity, and capacity for innovation.
David Peller (DP): While your business is recognized publicly by many, what’s one unique characteristic or feature that is either lesser known or understood about your company?
Dr. Patrick Andrae (PA): What might be unknown to others is how much HomeToGo has drastically evolved since its founding. We used to be known as the search engine for alternative accommodation, and have since grown to be the true marketplace with the world’s largest selection of vacation rentals. We’ve done a lot of work on both our tech and branding to educate partners and customers about this transition to a SaaS enabled marketplace. The HomeToGo marketplace is powered by our incredible tech team – more than 50% of our employees are working in product and tech – and our state-of-the-art data tech stack. Our engineers constantly innovate our tech offering to create a seamless experience for our consumers, while also developing new solutions to improve the platform for our partners of all sizes, from large-scale partners such as Booking.com to the micro property managers with unique, hidden gem rentals that you really can’t find anywhere else. We are always thinking about new ways to improve our product and rely on our tech team to stay nimble, develop creativity, and find the simplest solutions to the toughest problems.
DP: Let’s start with the most recent news: the IPO of HomeToGo. Some people might look at the additional complexity that a public company has, such as more transparency to stakeholders, being scrutinized by the investing public, and the expense of maintaining compliance with regulations as detracting factors. Can you please share your “why and why now” for choosing to take HomeToGo public?
PA: There are many reasons why we chose to go public this year, but they can all be encapsulated by our incredible growth and resilience throughout the pandemic. The mainstreaming of alternative accommodation was drastically accelerated with the changing effects of COVID-19 on the travel industry, and it has truly become the new zeitgeist. Travelers who traditionally reserved hotels now opt for vacation rentals. This offers them space to socially distance, remote work, and enjoy time with their families in remote, rural destinations. Now, many of these same travelers return to HomeToGo because they love the experiences they’ve had with us. There’s also been a substantial boom in domestic travel – the home turf for vacation rentals – as governments encourage holidays closer to home and people are becoming more aware of their carbon footprints. Companies are adopting remote approaches that let employees work from anywhere, thereby empowering the workation phenomenon as people realize they can complete their travel bucket lists without sacrificing their careers. These travel trends helped us achieve continuous and robust record growth up to and immediately following our listing as a public company. This was demonstrated by our recent financial results from the first nine months of 2021.
DP: I’m sure that during the process, everyone around you offered expert advice. Where and who did you turn to when you needed trusted guidance? And what is one nugget that stuck with you?
PA: Some of the best advice I receive is through the entire HomeToGo team, which is a credit to our non-hierarchical, open feedback approach where I constantly receive valuable opinions from everyone – from our Management Board with professional experience taking companies public to working students who offer fresh perspectives. Relying on one of our core HomeToGo cultural beliefs – Enabling Each Other to Succeed – we powered through the IPO process together. This also includes our investors that accompanied us throughout the different steps of our journey and the strong network in the industry and the European tech scene that we built up while creating HomeToGo.
The one nugget that really stuck out to me, and still does, is the incredible market potential in the alternative accommodation industry. Accommodation is a €1 trillion addressable market, but it’s highly fragmented and even the large online travel agencies only cover a fraction of it. We have so much opportunity ahead of us as a publicly listed company.
DP: No conversation can occur without a minor reflection on the past year. In the face of the industry disruption, we’ve observed incredible innovations. How has HomeToGo innovated through these challenging times and what are you most proud of?
PA: HomeToGo took immediate action when the COVID-19 crisis began. Almost overnight, alternative accommodation became the safer way to travel, and, after a strong but very short dip, we saw a substantial increase in demand. Our data and tech team monitored customer behavior and adapted accordingly by strongly focusing on developing new products that spoke to their needs – such as highlighting cancellation options, like free cancellation, better in-filters, and, throughout the whole user journey, providing our consumers with a quick overview and the ability to book with confidence even when future COVID-19 travel regulations were imminent. We also built a new COVID information tool to let travelers check updated regulations by country to aid with trip planning. In addition, we leveraged our existing innovative tools, such as our alternative suggestions for more flexible travelers, or our Flexible Date technology originally introduced in 2018, which we further improved to align with new usage data, resulting in a +570% uplift in usage since before the pandemic began (for example, when comparing usage uplift from Q3/2019 to Q3/2021). Despite this impressive work driven by HomeToGo tech, I am most proud of how the holistic team managed and got through the pandemic together. Now, less than two years later, we’re publicly listed on the Frankfurt Stock Exchange and hitting that milestone boils down to the talented, humble people behind this brand. Who would have thought that was possible for a travel start-up when Covid-19 unfolded?
DP: A subject that is near and dear to both of our hearts: HomeToGo has built its business on the cloud with AWS. Can you share insights into how the cloud has enabled agility and growth for your business – and why you’ve chosen to build on AWS?
PA: Before we moved the HomeToGo infrastructure to the cloud, AWS already had a reputation as a reliable and innovative technology partner for many companies. We started our partnership with the cloud by leveraging the autoscaling capabilities while significantly growing our business every year. Since working with AWS, we’ve specifically leveraged the cloud’s ability to add extra resources, as it not only helps with scaling in an economical way, but also ensures service availability during the travel-busy seasons when people tend to book their upcoming vacations. The cloud has enabled HomeToGo to build impressive architecture and helped us maintain 99.99% website uptime in the past six months.
DP: The industry has demonstrated its incredible resiliency. As you look toward recovery, what innovations born out of disruption do you see lasting well into the future?
PA: The pandemic propelled vacation rentals into the mainstream in terms of consumer demand, as many people learned how to search for and book alternative accommodations for the first time. This has resulted in long-lasting secular tailwinds for the whole sector that haven’t been there before, although alternative accommodation was already the fastest growing segment of travel prior to the crisis. Now that many travelers have tried and enjoyed the benefits of vacation rentals, this demand will last well into the future.
In addition, remote work will be the new normal. Many companies introduced remote work during the pandemic as a way to keep people safe, but this phenomenon also proved that people can be just as productive, if not more, while working remotely. As pandemic regulations ease and more offices begin to reopen, we are seeing that companies are adopting flexible approaches where people can work from offices, their home, and while traveling. This workation trend bolsters growth in the entire alternative accommodation ecosystem, as travelers book vacation rentals over hotels for privacy and safety. Workations have also resulted in longer bookings as people extend their vacations into workdays and have provided professionals with the ability to work from new and sometimes preferable environments. Why spend your winter in rainy Germany when you can work for a month or two on the sunny Portuguese coast? And this you definitely won’t do this in a hotel – you need something that feels like a home. At HomeToGo, team members are generally given the freedom to choose the best place for them to work from – whether that’s working remotely, from our state-of-the-art offices, like our biggest office in Berlin, or even while traveling to a dream destination. We believe workations are an important part of HomeToGo careers, and we love to watch our team explore new places while accomplishing their professional goals.
DP: If you can separate yourself from HomeToGo for a moment: As a traveler and guest, is there a destination that you have yet to visit and can’t wait to get to, and why?
PA: Personally, I am a big fan of more near-distance, sustainable travel and always keep my carbon footprint in mind when planning trips. I believe that many people overlook how beautiful their nearby surroundings are. There’s this mindset that people need to travel far to see amazing cities or the beauty of nature, when every place and community has incredible scenery to explore and culture to learn about. One potential silver lining of the pandemic is that people are embracing domestic travel and exploring their local surroundings, which is coincidentally better for the environment and is something that the whole planet can benefit from. However, I will admit that I would love to visit Japan one day. It is one longer trip that appeals to me because I am very interested in Japanese culture. Of course, I’d love to see what other travel technology is developed over the next few years to help make this trip as sustainable as possible.
See more of our Executive Conversations series and industry insights on the AWS Travel and Hospitality Blog.
Dr. Patrick Andrae is the Co-founder and CEO of HomeToGo. Prior to HomeToGo, Patrick was a leader at Rocket Internet and Home24. He is a member of the German Bar Association, and holds a business and law degree, as well as a PhD in Business Law from the University of Muenster. As part of his legal studies, he spent three months at the University of Oxford as a Research Associate at the Institute of European and Comparative Law.