Growth Partner has completed its £10.5 million investment into Host & Stay, the rapidly growing holiday let and short term rental management business with a market disrupting model, to support its buy-and-build strategy which has been set in motion with two acquisitions completing in parallel with Growth Partner’s investment.
The consumer-specialist investment firm, Growth Partner, which is backed by HomeServe Founder and Chairman Richard Harpin, has completed an investment of over £10 million into Host & Stay Group (“H&S”). Taking a minority stake in the holiday let and short term rental management business with a disruptive and vertically integrated model which has underpinned growth from 9 properties to over 1,000 properties under management in the last five years, an exceptional pace of growth that outstrips all others in the market over the same period.
H&S was founded in 2018 by entrepreneur Dale Smith and utilises a sophisticated, fully integrated model which unlocks greater rental yields for its property owners alongside a higher touch level of service. This differentiated model has helped the business capitalise on the £2.5bn thriving staycation market in the UK, enabling its exceptional year on year growth. With Growth Partner’s investment, H&S will be able to continue its rapid growth to become the leading end-to-end holiday let and short term rental management agency in the UK.
After completing a golf scholarship at the University of San Diego under Coach Tim Mickelson, Dale returned to the UK and made a swift rise through the corporate ranks at automotive retailer Peter Vardy, where he progressed from Marketing Assistant to Marketing Director in just three and a half years then going on to become a board level Commercial Director just five years later. Dale’s ambition naturally turned him down an entrepreneurial path which began with exploring personal property investment with his family. When searching for a holiday let management service provider on the North Yorkshire coast, Dale identified a gap in the market for an end-to-end management service, so at the age of 29, he left Peter Vardy to embark on his own venture, establishing H&S in 2018.
Dale’s vision was to build a truly differentiated holiday let and short term rental management business with a laser focus on delivering the highest quality service for both property owners and guests. As such, Host & Stay’s redefined model of property management allows them to uniquely leverage the brand authority and reach of global online travel agents, such as Airbnb and booking.com, to achieve higher occupancy rates and higher revenue per property than its competitors. This approach, alongside handling the full end-to-end process via a dedicated in-house team (which includes booking generation and marketing, housekeeping, maintenance, compliance, interior design support and refurbishment works) means that H&S can offer its services to property owners at lower than market base commission rates. This provides best-in-class rental yields, while also providing the highest quality of service to ensure great stays for guests and ease of management for property owners.
The traditional short term rental agencies have typically neglected those with properties in urban locations, in part due to the higher volume and associated complexities of shorter stays especially when relying on third party housekeeping and maintenance providers. H&S embraces this complexity due to its in-house teams and the operational foundations it has developed since day one. H&S is now capitalising on this gap in the market, whilst simultaneously continuing to grow its portfolio in traditional holiday let locations across the UK.
Dale has shown maturity and entrepreneurial expertise beyond his years in building an expert team around him. Most recently, hiring award-winning CFO Claire Maith, formerly CFO of Peter Vardy Group and Hays Travel Group, alongside other senior hires across operations, technology, marketing and an in-house M&A function. The business is set up to accelerate recent growth primarily through a combination of strategic M&A and organic customer acquisition via greater brand awareness and national reach in the market.
Now with the support of Growth Partner, H&S’s buy-and-build strategy has gained instant momentum with the acquisition of Norfolk Holiday Properties and Airhost For You, both completing in parallel with Growth Partner’s investment. Norfolk Holiday Properties, founded in 2018, provides management services to 130 properties spanning the entirety of Norfolk, from urban, to coastal, to rural, giving H&S a significant foothold in the 7th largest market by listings in the UK. Airhost For You, founded in 2015, manages 105 properties in Brighton (Airbnb’s most searched location in the UK in 2023) making it the largest property management company in the region.
H&S’s acquisition professionalise these businesses, enhance profitability, and provides opportunities for the staff within those businesses to grow and develop as part of a larger organisation. Additionally, H&S’s fully managed proposition enables more efficient on the ground operations, increasing the volume of stays per property, ensuring a higher quality experience for guests, and bolstering tourist activity. H&S has also recently launched its StayLocal tech platform, which provides an easily accessible solution for independent hospitality businesses such as shops, cafes, restaurants and attractions to connect with inbound tourists and incentivises them to spend their hard earned pounds with local independent businesses, positively impacting local economies.
Alex Marsh, Partner at Growth Partner, led the deal and was supported by Jade Kelsall.
Robert Phillips & Oliver Rickett of Womble Bond Dickinson provided legal advice, Luminii Consulting provided commercial due diligence, Interpath provided financial due diligence, Lockton provided insurance due diligence, and Claritas Tax provided tax structuring. H&S were advised by Nik Tunley of Endeavour on legal, James Dale of Anderson Barrowcliff provided CF management advisory and KPMG provided sell side CF advice.
Richard Harpin said: “Host & Stay embodies the entrepreneurial spirit and commitment to excellence that drives true innovation in any industry. Dale Smith and his team have harnessed a unique market opportunity and are poised for tremendous growth. Our backing will support H&S in its journey to set new benchmarks in the holiday let and rental management space.”
Dale Smith said: “After several years of growing Host & Stay organically from a single property to one of the largest short term rental management agencies in the UK, we’re truly excited to be partnering with Growth Partner for our next phase of the journey and to realise our ambition of becoming one of the world’s best short term rental operators.
Alex and the wider Growth Partner team have been exceptional to work with throughout the investment process and they have approached the partnership in a collaborative and pragmatic way from day one. This approach has only further strengthened my confidence that we have chosen the right investment partner, and along with the vast experience and strategic influence of Richard, we’re now in a fantastic position to accelerate the growth of Host & Stay both in the UK and overseas.”
Alex Marsh said: “We’re very excited to announce our latest investment in Host & Stay, a truly disruptive force in the holiday let and short-term rental management sector. Dale’s vision and execution have transformed H&S from startup into one of the market leader’s with over 1,000 properties under management in just five years. This rapid growth and innovative model have made H&S a standout in the booming £2.5 billion UK staycation market.
Dale is building an outstanding team, and our support and investment will fuel H&S’s buy-and-build strategy as they build towards national coverage. H&S are on a mission to redefine industry standards, enhance guest experiences, and provide unmatched service and yields to property owners and we’re excited to supporting Dale and his team accelerate growth.”