STARTUP STAGE: Pinktada is an NFT-based hotel marketplace

Pinktada

Pinktada is a blockchain-based marketplace for hotels that turns each combination of "hotel plus room plus night" into an NFT that the owner can use, sell or swap.

Founded in 2020, the booking platform currently offers properties in the Dominican Republic, Hawaii, Mexico and San Francisco.

What is your 30-second pitch to investors?

Pinktada is a membership-based primary and secondary market for hotel rooms, architected on tokenization. Pinktada is built on blockchain technology and delivers an unparalleled user experience. Pinktada leverages the utilitarian aspects of NFTs to deliver greater value to hotels in the form of increased sales of non-refundable reservations while preserving flexibility for travelers, who can swap or sell their reservation tokens on the platform if their plans change.

Pinktada offers a fully immersive customer experience, enabling travelers to explore amenities and rooms in 3D prior to booking and giving hotels the ability to showcase their unique attributes. 

Describe both the business and technology aspects of your start-up.

Our platform aims to transform the fundamental reservation model that has existed for decades. Pinktada’s marketplace model is unique in that it brings benefits to both hotel owners and travelers. Hotel owners will get direct financial benefits, but they will now have the freedom to experiment more and create innovative new options for travelers. They will eventually have access to consumer data with a depth and precision currently unimaginable.

Travelers will also benefit with unprecedented flexibility to change their plans and explore specific rooms or room types and travel options tailored to their needs. 

Pinktada offers hotel partners and their guests the ability to transform the utilitarian NFT in a personalized, commemorative NFT at checkout. The NFT is co-branded between Pinktada and the hotel, and travelers can customize it with visual assets from their trips. These NFTs can also have utility value (e.g., a special coupon for the NFT owner to share with family and friends) and collectible value in the case of travel experiences that are iconic and unique (e.g., a historic hotel or the room where a celebrity once stayed). 

The innovation and uniqueness at Pinktada, is that each combination of "hotel plus room plus night" becomes a distinct token, called a Room-Night-token (RNT). The RNT is fully tradable on our platform - the owner can use it, sell it, or swap it for any other RNT in our marketplace. The innovation has allowed us to create a revolutionary model where any traveler searching Pinktada.com for hotel rooms can pull inventory from both primary and secondary supply. The traveler sees a blended rate for each of their hotel options, combining options from live inventory sales from hotels with options on our marketplace. 

Give us your SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis of the company.

• Strengths
  • International network in hospitality, travel, finance and technology
  • For a leisure customer, Room-Night-Token model is superior to existing reservation models
  • Will provide non-refundable income to hotels
  • Will give travelers best-in-class online hotel exploration experience
  • Strong advisory board
  • Ability to collect granular hotel room pricing data
• Weaknesses
  • We are a startup and new to the market 
  • New distribution channel in a strong competitive market with high marketing expenditures
  • Limited marketing budget, difficult to compete with larger rivals
• Opportunities
  • There is no secondary market for hotel room price discovery
  • No one else can provide flexibility to swap rooms with minimal cost
  • Possibility to book the exact room and amenities 
  • Market dominated by OTAs with high fee structures
• Threats
  • The need to raise funding to grow and develop Pinktada and become an established brand 
  • Broad variety of competitors in the distribution sector with deep pockets that could shift strategy to compete with us directly
  • A new disaster could threaten the expected growth
  • Big players growing aggressively in online booking space

What are the travel pain points you are trying to alleviate from both the customer and the industry perspective?

We are solving three major problems at Pinktada. The first one is the loss of value that occurs with an inefficient distribution model that has not evolved in 20-plus years. Take for example the binary, refundable/non-refundable pricing structure: for travelers, best pricing comes without flexibility. For hotels, best pricing comes without revenue certainty. With Pinktada, best pricing and flexibility come hand in hand. We are able to address this problem by tokenizing room nights, and those tokens are fully tradable. 

The second problem we solve is commoditization. Current booking options do not enable hotels to display their unique attributes effectively. By the same token, guests do not really know what they are getting until they arrive. Pinktada’s user interface combines experiential and transactional capabilities. Travelers can explore different properties and accommodations in 3D, and reserve rooms and amenities directly from this immersive experience. Finally, one of the largest, long-term benefits of Pinktada, is the detailed customer behavior data, that will also be available to hotel owners. Hotel owners will thus get unprecedented and highly valuable granular data, that outlines the effect price changes; room alterations; and external events have on room bookings. All of this will culminate in optimum guest personalization.

So you've got the product, now how will you get lots of customers?

On the supply side, we are focusing in the first phase on the U.S. and Caribbean key leisure markets fed by U.S. outbound traffic from concentrated U.S. source markets (East and West coasts). We have exceeded our goals for the signing of hotels to date and have signed a mix of reputable and quality hotel owners and managers in the United States and the Caribbean.

We have also presented our unique product and are in discussion with over 100 additional hotel owners and managers. The enthusiasm and sophistication of our initial hotel customers demonstrates that there are no longer questions about our ability to build the supply side of the marketplace.

On the demand side, we are focused initially on U.S. millennial and Gen Z leisure travelers. Our membership base continues to grow daily. Content creation and performance marketing are running efficiently with regular cadence and clear processes. A mix of organic social efforts and a learning phase of paid acquisition efforts, testing different offers across channels and optimizing campaigns. Direct is our top source of traffic, reflecting successful media coverage and effective presence at select events. Furthermore, we have started to focus on finding distribution partnerships with complementary consumer brands. 

Tell us what process you've gone through to establish a genuine need for your company and the size of the addressable market.

The existing travel landscape is dominated by two forms of reservation - a full-price, cancellable, fully refundable reservation and a discounted pre-paid, non-refundable and non-transferable reservation.

A full-price cancellable reservation gives travelers unlimited optionality to cancel at will, leaving hotels exposed to short-term changes in customer behavior. If a traveler changes their plans and cancels their reservation, the risk of finding a replacement traveler falls on the hotel. If they cannot find a replacement, that room is empty, and they lose all that prospective revenue. In situations of significant demand destruction, such as COVID, losses to the hotelier can be catastrophic.

A discount pre-paid non-refundable reservation assures that the hotel will generate revenue but eliminates any flexibility for the customer. Non-refundable reservations typically carry a price discount of 10 to 15% compared to refundable reservations. Leisure customers tend to be very price sensitive, and in 2019, a high percentage of leisure customers found this discount attractive enough to choose non-refundable reservations and forfeit their ability to cancel. If a customer’s plans change, whether that change means cancellation or an altered schedule or a change in the number of fellow travelers, the customer cannot change the reservation. The customer faces complete loss of their payment.

Neither of these models is optimal. When a traveler’s plans change, a potential loss is borne by either the hotel or the traveler. In a networked world, where tens of thousands of people are changing travel plans every day, a network-based solution would allow travelers to find other travelers to take over their existing reservations. 

The Pinktada tokenized room-night model is optimized to create better outcomes for both hotels and travelers. Hotels are able to sell all of their rooms on Pinktada on a non-refundable basis, guaranteeing stable and consistent revenue, regardless of changes in aggregate demand or an individual travelers plans. Travelers are able to enjoy the price discount of a non-refundable reservation, while maintaining the ability to change their reservation in a marketplace.

On the supply side, hotels are, of course, a subset of global travel. Global hotel room revenue was estimated at $550 billion in 2019. Online bookings are a subset of global hotel revenue. Every year, more bookings are made through online platforms. 

On the consumer side, our initial target of professional millennials and Gen Z travelers in key concentrated U.S. source markets is estimated at around 11 million people.

How and when will you make money?

We charge a commission on the primary market and also charge a commission on the secondary market to marketplace participants. We have started to generate revenues since we launched in May.

What are the backgrounds and previous achievements of the founding team?

Lyon Hardgrave was the founder of VAKT, the largest blockchain startup in the energy space, with a valuation above $100 million. He has over 15 years of commodities trading and risk.

Ronald Homsy was the co-founder and CEO of Utopian Hotel Collection and founder and CEO of Forte Holding, a hospitality company with $70 million turnover yearly. He has 25 years of hospitality and travel industry experience.

Rana Basu was the founder of Ondiflo, a blockchain platform for logistics. He co-founded software startups in Switzerland, India and Singapore.

Darden Bateau was the CFO of Astra Oil company with $7 billion revenue and chief risk officer of $20 billion Transcor Astra Group. Darden was a senior manager at Deloitte.

Rama Pakala has 25 years of experience delivering platforms. Rama was the chief architect of Ondiflo blockchain technology and vice-president and master architect at Amphora.

Ilana Grossman was the CEO of B2Both.com, a boutique marketing strategy consultancy. Ilana has held senior positions at BCG and Digitas and was the CMO at Gust, the leading startup financing by angel investors and Artsy, the leading global online art marketplace.

Mark Gordon is a hotel developer and investor including the Baccarat Hotel in New York City. He is the CEO of Intrinsic Hotel Capital and has over 30 years of hotel industry experience.

Jun Simmons has over 20 years of experience in design. She previously was the chief creative officer at Gust and prior to that she was the design team leader at PayPal.

How have you addressed diversity and inclusion within your business?

We are committed to diversity and inclusion as core values to our organization. We have been hiring diverse backgrounds. We also provide equal opportunities throughout each touch point of the employee experience and are big promoters of pay equity. We are big believers that cultural diversity enriches the work environment and makes us much stronger as a team, which in turn will power innovation and financial performance. We also believe a team is only effective if everyone feels included as everyone has special talents and things to share with others. We work very hard on developing relationships with employees so we can truly understand who they are as individuals and know how best to work together. We also plan to develop a strategic training program to see real lasting change within our organization. 

What's been the most difficult part of founding the business so far?

Obviously raising money is a very tough one for startups, but in this current global crisis this is even much more of a difficult one.

Generally, travel startups face a fairly tough time making an impact - so why are you going to be one of lucky ones?

We believe we have a product that will revolutionize hotel bookings and is very much needed by the market.

A year from now, what state do you think your startup will be in?

We plan to have raised Series A round a year from now.

What is your end-game? (Going public, acquisition, growing and staying private, etc.)

This will depend on many internal and external factors, though the likelihood would be an acquisition.