I first met Aahan, founder and CEO of Silkhaus, in 2020 during the COVID lockdown and we developed a relationship that grew from a lockdown Zoom call to regular coffee catch ups to brainstorm new business ideas together.
In early 2021, he came to me to tell me about a company that he was thinking of starting within the short-term rentals (“STRs”) space and he was passionately speaking about the problem with STRs within emerging markets and how it is ripe for disruption, consolidation, and digitization, which I agreed with. The company was Silkhaus.
The truth of the matter is that I would have been eager to invest in any company that Aahan was behind, but adding to that he was endeavouring to solve a real problem in tough and fragmented markets, and one that we strongly believe Aahan is very well suited to take on.
Our first investment in Silkhaus was at their very early stage and soon after launch, we have seen the company achieve operational excellence with limited resources, prove product market fit and recruit a world class team of senior leaders - a prerequisite to success. We’re not the only ones who bought the vision – super senior people moved from the other end of the world to help build out Silkhaus - such as cofounder Ashmin Varma, who is leading international expansion and product, an integral part to the future of Silkhaus.
At the time we were taking the decision to invest in Silkhaus, we were at a period where Silkhaus was operating a number of properties in Dubai, outperforming global benchmarks in occupancy, proving very healthy unit economics and showing early indications of scale at the city level. The performance spoke for itself, and the early performance proved the ability of the team to execute. Having said that, what made us excited to lead this round was the outlook for the future.
And their future looks very promising. Technology will play a much bigger role with the ambition of digitizing a very fragmented market of property owners and managers who all want to increase their property yields. Couple this with a customer who wants the variability of quality removed from the rental decision, we have a unique and uncharted opportunity within emerging markets.
With business travel ramping up, leisure travel steadily moving towards STRs, and remote work becoming more pervasive, we see a lot of sectoral tail winds. Silkhaus is also a business that is centred around profitability at the unit level and at the portfolio level, which has proven to be an existential imperative during market downturns.
How will this scale
‘Healthy economics come at the expense of growth’ is a statement that Silkhaus does not believe. With best-in-class occupancy rates, a growing portfolio of aggregated supply and high booking values across the B2C and B2B customer segments, we see the ability for the core business to expand rapidly to new cities across the emerging markets of Asia. Pairing this with a software platform that allows property owners / operators to optimize their processes and increase their yields while improving the CX for the renter can allow Silkhaus to scale in a way that is more asset-light and effectively borderless.
Over the course of the past year, we have seen the Silkhaus team grow and attract stellar talent, and Aahan and Ashmin have our full confidence and support. We are looking forward to this partnership to continue to deepen, and hope that we can add adequate value to Silkhaus and help them reach their goals even sooner.