STARTUPS

After raising millions, Austin's TurnKey Vacation Rentals is in expansion mode

The Austin startup - which helps property owners rent vacation homes - is breaking into new markets and adding employees.

Posted November 23rd, 2016

Eight months after raising $10 million, Austin's TurnKey Vacation Rentals is in expansion mode.

The startup, which manages short-term vacation rentals for property owners, is breaking into new markets, adding new listings and recently moved into a larger headquarters to accommodate its growing workforce.

"The vacation rental market has done nothing but speed up," said co-founder John Banczak. "A good economy helps, people are traveling more than ever and this category is becoming bigger than anyone ever thought."

TurnKey's lead investors in the $10 million infusion were Altos Ventures, based in Silicon Valley, and Silverton Partners, based in Austin. The funding brought the total amount raised by TurnKey to $20 million.

Founded in 2013, TurnKey provides an online service that handles the process of renting out a vacation home, from marketing it on sites like HomeAway and Airbnb to sending a cleaning service when guests leave.

TurnKey is in 35 markets, most of them popular tourist destinations such as Aspen, Colo., Sonoma  County, Calif., Jackson Hole, Wyoming, and Sarasota, Fla. It also offers services in handful of larger metro areas such as Austin and Seattle.

The company expects to enter 15 to 18 new markets next year.

TurnKey's co-founders are veterans of the online travel industry who saw an opportunity to use mobile technology to handle the process of renting a vacation rental home. The idea was to make the process of renting out a home easier for property owners.

Banczak formerly held leadership roles at HomeAway, BnB.com and Hotwire.com, while T.J. Clark was previously CEO of Limos.com and corporate counsel at Hotwire.

"If you have a home you want to rent out, it's very time consuming to manage it," Banczak said. "It takes a lot of work, you're spending hours and hours dealing with guests, scheduling maintenance. A lot of people don't have that time, so they come to TurnKey."

John Banczak is co-founder and CEO of TurnKey Vacation Rentals

Today, TurnKey manages about 1,800 properties. Its service includes setting a rate, promoting the home on vacation rental sites, responding to guest inquiries and handling reservations. 

When a property is booked, TurnKey oversees the visit, including check-ins, cleaning and maintenance. 

Guests check in using a digital lock that doesn't need a key, and they download a mobile app to get information about the property and to reach TurnKey staff.

TurnKey competes with traditional property management firms. TurnKey charges property owners 18 percent of bookings, which would mean $36 for a $200-a-night rental.

Banczak said bookings are increasing because of a shift in the vacation rental home market.

"Guests are looking for a boutique hotel experience," he said. "They have high expectations and want to stay in a home that has a guaranteed consistent experience. The average homeowner is having trouble maintaining that level of experience."

Although some cities including Austin have taken steps to limit certain types of short-term rentals, Banczak said TurnKey's focus is on vacation spots, where such rentals are popular.

"Most rentals still  happen in places like Vail, Palm Springs and Port Aransas," he said. "There are literally millions of units in vacation destinations."

TurnKey has grown from 127 employees to 220 today, including 105 in Austin and the remainder in local offices around the country. The company is hiring across the board, in positions including in sales, account management and field workers.

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