Stay Alfred was a successful startup based out of Spokane, Washington. The company converted and rented out apartments for short term tenants, mainly for tourists and travellers. Founded in 2011, the company had raised over $60 Million in funding and was on its way to increasing its presence in the market before Covid-19 hit the US.
Stay Alfred – Before the Pandemic
Stay Alfred was founded as a short term rental company but later evolved into an alternative stop for travellers looking for better accommodation. They offered the comforts of a fully furnished apartment in an industry that mostly had bland hotel rooms that felt more like a pit stop and less like a home. They were also responsible for the cleaning, furnishing, rental and maintenance of these units. This allowed them to maintain strict quality standards across all their units.
By providing their customers with quality accommodation that felt local even in a temporary setting, they were able to attract customers, and this success gained investment as well. In late 2018, they were able to raise $47 Million for expanding across the United States. In the same year, they were able to increase their annual revenue to $66.5 Million, almost three times that of 2016.
Stay Alfred Expansion plans
After hiring Mr Steve Helmbrecht as their President and CFO in May 2019, the company had plans to expand to the Global Market. Before this appointment, he was the CEO of Lakeside Capital Group, another Spokane based firm. Mr Helmbrecht had much experience gaining capital for companies and helping them expand globally. Stay Alfred was primed for a global expansion, and had a total of 2500 apartments in over 33 markets, hosting more than 800,000 guests. This was all before the Pandemic happened.
The Covid Disruption
The fate of this growing company was the same as a lot of companies in the travel and tourism sector. As a rental service that provided accommodation for travellers, a worldwide travel ban hit them hard. As people became confined to their homes, their revenue stream dried up overnight. Not only did their expansion plans stop, but even their daily operations were threatened.
Stay Alfred had to close down its properties across the US for 8 weeks, starting from April 1, 2020. A part of its workforce was also furloughed, and the company was planning to retreat to a few select properties that it had owned. They also tried to sell off their assets but to no avail.
The inevitable occurred in May 2020, when the company permanently closed down due to the pandemic. The company CEO, Jordan Allen quoted in his announcement that it was “amazing to think that a $100 million company in Spokane, Washington, could be wiped out by a virus from Wuhan, China”.
This was another promising startup that fell victim to Covid-19. A $100 Million company that was still growing had to close in just 2 months due to the lockdown. Many such companies that are part of the travel industry had no hope of survival in this situation. In hindsight, this highlights the necessity of such firms to have a business model and contingencies to tackle such a crisis.