Proxce, a Silicon Valley startup, sells technology that enables hotels to automatically check in their guests by installing sensors that communicate with the guests' smartphones once they arrive at a property.
The primary cause for long lines at hotel lobbies is verifying a guest's identity, assigning a room, and issuing keys. Proxce aims to automate the process.
If a guest downloads Proxce's app and registers their smartphone, the sensors will recognize the guest on arrival.
If a hotel installs wireless door locks that are compatible with Proxce's systems, the guest can walk straight to their room and unlock the door with their smartphone. (Proxce's app tells them the room number.)
Otherwise the guest still needs to talk to a front desk representative to pick up a key. But that process could still be a shorter because the guest has already been checked in, says the startup.
Proxce can handle a reservation whether it was made directly with the hotel or through a third-party agency. But it will probably be hotels that will be the key marketing partner that informs a guest prior to a stay that he or she should download the Proxce app for additional services.
A Q&A with CEO and founder Madhu Madhusudhanan:
Tell us how you founded the company, why and what made you decide to jump in and create the business.
As a business traveller myself, I have always longed for a seamless travel experience.
Today’s traveller, like me, is opting for Uber over a traditional taxi, TSA pre check-in over regular security check, and picking up rental car from the aisle rather than standing in line.
The last piece of the puzzle was hotels. That’s why we created Proxce – to complete the prefect trip by providing a seamless hotel check-in experience.
Size of the team, names of founders, management roles and key personnel?
5 full-time, 2 part-time
Madhu Madhusudhanan – Founder and CEO
Mimi Mortezai – Design, Sales, and Marketing
Hiren Mowji – Resident Growth Hacker
Lucky Thanvi – Lead IOS Developer,
Costin Rizan – Software Developer/Architect
Srinivas Bhat – Founder, CMO (Part-Time)
Elu Thinagaran – Sr. System Architect (Part-Time)
Funding arrangements?
Current Round – Raised $150K so far in 1 week. TARGET $750,000
Estimation of market size?
12 billon check-ins a year, $6 billion per year potential revenue opportunity.
Competition?
Hotels are our biggest competitors with in-house development (Starwood, Marriott etc.). Checkmate.io provides web-based check-in.
Revenue model and strategy for profitability?
The initial revenue will come from our Starter Kits. They will be sold to hotels for a flat fee of $3,000 – $8,000. These kits will allow hotels to offer simple mobile check-in and key pick up service.
After an evaluation period, the revenue drivers are a fixed implementation cost that run between $5,000 – $50,000, along with monthly subscription for full integration after evaluation period.
What problem does the business solve?
The check-in process in hotels has not changed in decades and it is time for a change. Proxce makes real world identification simple. Lines: everyone hates them -- especially check-in lines at hotels. We solve that pain point.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
The initial plan was to deploy end-to-end check-in experience, i.e check-in and keyless entry.
After discovering challenges in working with lock manufacturers, Proxce is focusing on mobile check-in and key pickup as a product offering, and we offer keyless entry as a custom development.
Proxce - Hotel check-in experience redefined from Proxce on Vimeo.
Why should people or companies use the business?
From the Hotel Perspective:
It simplifies the check-in process by offering mobile check-in.
They can:
• Elevate guest experience
• Improve their pricing power
• Improve direct room sales
• Reduce operating cost
• Get futuristic – Wow factor
• Differentiate their hotel
From the Traveller/Guest Perspective:
• Convenience at your finger tips
• No more waiting in lines – go straight to your assigned room when you arrive.
• Register once and be done with it. Book from anywhere and we will check you in.
What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?
We are a B2B2C company – we sell our product to hotels. Our primary channels are online (through our website) and trade shows.
Hotels reach out to their guests to download the app through a confirmation email with room details during the reservation process.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?
In three years, Proxce should be deployed in most of the major hotel chains across the world. The biggest challenge will be working with legacy systems in a few hotels.
What is wrong with the travel, tourism and hospitality industry that it requires a startup like yours to help it out?
Travel industry relies heavily on marketing, asking the travellers to do all the work like launching the app and taking action and learning new things.
Proxce is built on background modes and requires no action from the user once they register. It could be easily scalable and allows someone who not tech-savvy to use it the same way as millennials.
What other technology company (in or outside of travel) would you consider yourselves most closely aligned to in terms of culture and style... and why?
Uber – I know it’s a cliché by now as everyone wants to be Uber, however, we truly believe that the success of Uber is because you can go from one place to another with 2-3 taps on your phone.
At Proxce, we are trying to achieve entire hotel check-in experience in less than that.
Which company would be the best fit to buy your startup?
Major OTAs like Priceline, Expedia etc.
Other potential buyers from travel: Disney, Carlson Wagonlit Travel.
Outside of travel – MasterCard, Visa (identity management)
Describe your startup in three words?
Future of Identification.
Proxce has created a Vine for its elevator pitch:
Tnooz view:
Proxce has hit on a clear pain point for consumers. A recent IHG survey found that 42.2% of customers would like the opportunity to check in via mobile.
Hotels like mobile check-in because it becomes an interaction opportunity for upsells. But they may balk at changing their rhythm and pace for assigning a room number to a guest from a manual system to something involving Proxce's automation.
Proxce may also face stiff competition.
As it notes, hotel chains themselves are investing in this space. Most prominently, Hilton will let you pick a room and unlock its door with your mobile device, using some in-house technology.
Starwood and Disney are each doing trials, too.
Multiple companies are attempting to help hotels offer seamless check-in. One startup that has made significant inroads with hotel brands is Checkmate, which Tnooz recently profiled.
Another startup is GTRIIP, which uses biometric identification to facilitate guest check-in.
HotelTonight has also made noises suggesting it is interested in participating in this space.
Proxce may struggle to dominate. But it could become a standby for independents and regional chains that don’t have the resources to create proprietary technology or pay for more expensive alternatives.