As part of our WiT Startup Spotlight series, we chatted to BedLinker founder and CEO, Thuan Dao, who shared how this Vietnam hospitality startup can help hotels and resorts distribute their inventory with OTAs more effectively.

Describe the business, core products and services in one paragraph.

BedLinker is a technology solution provider in the hospitality industry. We are developing an integrated B2B distribution solution for hotels and resorts to help them to improve distribution efficiency and driving more direct bookings from B2B clients such as travel agencies, tour operators, wholesalers, DMCs, TMCs and corporate.

Who are your key customers?

• 3-5 star hotels & resorts – currently about 400,000 properties worldwide.
• Travel Agencies, Tour Operators, Wholesalers, DMCs, TMCs & Corporate – approximately 300 partners.

Who are your key partners?

What business are you most likely to be compared to?

Hotelbeds – purely because Hotelbeds is doing the B2B model too, but they sell their API connection so they are a platform. BedLinker is more of a marketplace model, so hotels can share directly with the buyer/travel agency. We don’t put any [price] mark up on that.

What problem are you trying to solve for your customers?

Some of the challenges that B2B clients are facing when they want to check availability, rates and make bookings with hotels and resorts, include:

• A high number of calls and emails with hotels to check availability and rates before making a reservation.
• Intermediaries like OTAs ask for higher commission, which leads to lower profit margins for hotels and resorts.
• Low quality of customer service because of low response rates from hotels, leading to less bookings.
• No on-time updates on promotions
• Difficult to get room availability, especially during peak periods

What problem are you trying to solve for your partners?

Some of the issues that hotels and resorts suffer from are:

• No effective tools to distribute to travel agencies effectively, while they occupy up to 80% of the hotel’s business
• Paying high commissions to OTA B2C and B2B (18-25%), resulting in high distribution costs and low profit
• No tools to apply dynamic pricing to B2B clients
• Difficulty in sending promotions to B2B clients, especially during low demand periods
• Reservation and sales teams have to spend a lot of time checking availability for B2B clients, especially during peak periods

What financial support did you have to launch the business?

Self-funding, relatives, friends and colleagues.

Who validated the idea first – investors or customers?

Customers. [BedLinker had] 50 bookings at the beginning, and now its about $20,000 per month. There has been rapid growth as BedLinker has been in the market or just a year. Growth is about 60% per month.

What is the revenue model and strategy for profitability?

1. BedAllocator is the B2B distribution manager, which is a subscription based SaaS.

2. BedLinker.com – The B2B Travel Marketplace: Commission based on materialised transactions.

What is the market opportunity? How scalable is this business?

In Asia, the B2B segment is occupied by up to 60%-80% of hotels & resorts business. This business can be scaled globally.

Why is Vietnam the hottest travel market opportunity?

Currently, in our market, not just Vietnam but Southeast Asia, we don’t have much competition now. We are the only one who has this business model in SEA.

Competitive analysis – strengths, weaknesses, opportunities and threats.

Strengths:

BedLinkers founding team and shareholders possess in-depth practical knowledge, experience and network in the hospitality industry in Vietnam. Many of them are also business owners with an excellent understanding of the business environment in Vietnam.

Weaknesses:

BedLinker is a new name in the market and we need time to convince customers about our solutions.

As more of our inventory is from API integration, we may not have competitive [enough] prices in many properties, to attract travel agencies.

Opportunities:

The tourism industry in Vietnam is at an early stage of booming and there is huge potential to grow. According to Grant Thornton Vietnam (2017), only 20.7% of hotel reservations were generated through internet sales.

[There is] a high demand for technological services due to a recent wave of startups across the country. The Vietnam government is promoting online business startups, especially in the tourism sector.

Threats:

B2C OTAs like Expedia, Agoda or Booking.com have already developed their B2B portals for travel agencies. Once the B2B platform is known to the market, it won’t be long before another technology company tries to copy our ideas to develop a similar platform.

What is the biggest challenge facing BedLinker’s growth?

[The] biggest one is now funding for our business growth. We started this project with our set funding, without an investor. Our team was actually using our own pocket money to invest into this business, so we are now bootstrapping. We want to get a long-term investor and we just signed up for an accelerator programme.

Who are the team members and advisors?

BedLinker is under the accelerator program of Zone Startups.

Why do you think you are the best people to make this vision happen?

You can see my professional background here. I have more than 15+ years working experience in hospitality industry. My co-founders have 10+ years working experience in hospitality, software and OTA industry. We are entrepreneurs who have years of experiences, expertise, good business relationships and a strong network in the industry.

What’s the motivation behind doing this?

We’d like to find innovative ways to help hoteliers to solve the problems between hoteliers and their B2B clients caused by the offline working process. We want to help them to work well with each other and improve the direct distribution process.