Skift Take
Oyo made headlines for offering hotels a minimum revenue guarantee in exchange for taking control of hotel operations. Bob Diener and David Litman are doing it with a twist — trying to drive demand to select hotels to steal business from their peers in exchange for hefty margins on each sale.
Bob Diener and David Litman, the sexagenarian duo who co-founded Hotels.com and Getaroom, are back with the launch of a unique hotel distribution network in the U.S. that offers mostly 3-star hotels a minimum revenue guarantee.
Unlike Getaroom, a wholesale hotel distribution service that the two self-funded in its early days, the new Travel Funders Network, which debuted a few days ago, comes with $50-$100 million in funding from private equity firm Court Square, which teamed with a Canadian pension fund to acquire global distribution system Worldspan in 2003.
"We look to be a core base of business for the hotel," Diener told Skift exclusively Tuesday. "We help them cover their nut and then they can revenue manage the rest of their rooms at higher rates."
[caption id="attachment_302973" align="alignright" width="150"] Bob Diener[/caption]
Minimum revenue guarantees for hotels sound like shades of Oyo, which tried and eventually abandoned the practice, but the Travel Funders Network is not the Oyo model. Unlike Oyo, the Travel Funders Network doesn't operate hotels on behalf of owners, doesn't have a flag,
