Summer vacation is around the corner and thousands of college students are dusting off their backpacks and planning their next adventure. Spots, a home-sharing app to help you find a spot to crash, is there to help them find lodging along the way.
Aiming to fill the low-cost gap left by bigger sharing companies such as Airbnb and Homeaway, Spots wants students to party hard, see the world and have a safe space to crash without the need for reservations. The app provides the user with an interactive map, profile pages and a secure way to pay — all necessary things for traveling on a whim. Better yet, you can list your spot and make some extra cash as well.
We recently caught up with CEO Yanni Barghouty, currently pursuing his Biomedical Engineering degree at Georgia Tech, on how Spots is disrupting the sharing economy to benefit the often-empty pockets of college students and breaking into the industry.
Are you funded or bootstrapped?
Spots Development Group LLC remains a privately funded company, operating on personal investments from the founding members.
Spots is a home-sharing application designed to give college students an immediate, social, and low-cost alternative to hotels wherever there are other students. In addition, it gives students the opportunity to make some cash on the side by offering up their own Spot, be it a spare room or sofa, to their travelling colleagues. Whether Spots is used for a night out on the town, a concert or sporting event, or visiting a prospective university, the app is suited for a global student market. The app allows fast booking times through an easy-to-navigate map interface, intuitive profile pages, and a swift and reliable payment method.
What problem are you solving?
Spots is the answer to affordable and instantaneous social housing for students, users who are regularly out priced by hotels and services like HomeAway and Airbnb.
Why go after college students as your demographic?
College students represent a majority demographic of consumers who are turning to a sharing economy, which is best described as, “what’s mine is yours, for a fee.” Over 55 million students worldwide are in need for low-end high-volume products and services. Spots is here to provide just that when it comes to housing and accommodate a user base that Airbnb has yet to attract. While we assure users security, through safe payment as well as verification of .edu emails, the experience has to be friendly. Social media accounts are linked so you know who you’re staying with.
Please describe the market/industry impact:
Spots is uniquely positioned to target a young (18-24 years) audience with an active social life, less disposable income, and more interested in on demand single night stays, with more emphasis placed on the lister themselves rather than on the room itself. Essentially, Spots is designed to fill in the gap left unfilled by Airbnb and its clones and to pick up the market Couchsurfing left behind in its decline. The addressable population (college students) in the US and Europe, which will be the markets with the highest uptake, is 21 million and 32.8 million respectively. Due to the fact that the college audience has a tendency to have significantly more active social lives than any other age group on average, it is reasonable to expect that a faster adoption rate and a higher usage rate when compared to those who use the services of competitors such as Airbnb. Furthermore, due to the focus of the app on connecting people to people rather than just to places to stay, it has the potential to make headway into the markets of Tinder and Friendsy, which collectively have over 50 million monthly active users. This far exceeds the collective total of the Social Housing market.
The current revenue model for Spots involves a 10% commission per transaction, both on the buyer and seller’s side an amount in-line with the current standard amongst our competitors.
How’d you get the idea for it?
The idea came to mind when riding in an Uber, but in the general sense, a continued exposure to the sharing economy led founder Yanni to find a solution the problems that travelling college students face regularly.
Who are your competitors and how do you stand out?
The current social housing market is predominately focused on ‘home sharing’, which is the concept of leasing out one’s home/apartment for a profit while the owner/tenant is away. Of all the companies in the industry, only Airbnb and Homeaway have a notable presence in the mobile sector, while the rest (9Flats, Wimdu, Couchsurfing) predominantly rely on bookings through a website. Both Airbnb and Homeaway enjoy the same critical perk that allows for extremely rapid growth; bringing internet and more importantly networking companies, they enjoy extremely low overheads and operating costs when compared to the traditional players in the travel accommodation market, and thus attain previously unreachable profit margins. However, these all the companies mentioned above focus primarily on extended stays (80% of bookings, on average, that last between 8-14 days) and a medium-low cost target (average price of bookings per night ≈ $100-$150). It is thus reasonable to infer that the target audience has some readily disposable income as well as occasional small stretches of time for travel. This points to a target audience ranging from 30-49 years of age (based on US census data); essentially individuals active in a white collar workforce.How does Atlanta weave into your story?
Atlanta is where we all met. We come from 5 different countries (U.S., Italy, India, UAE, and Iran) and different backgrounds, most of us moved to the U.S. for college. We’ve all known each other since our freshman year at Georgia Tech.
Are you hiring right now?
Spots is currently looking to hire summer interns to assist with development and marketing tasks.