Outsite's CTO on Building the Future of Remote Work Hotels
Yeah. Something we're experimenting with is the use of AI and chat GPT. Right now, we use it mainly to help with the reservations team and to filter out the communication that we get.
Speaker 2:From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them.
Speaker 3:Today, we speak with Stein Beaupre, the CTO at Outsite. Prior to Stijn's 8 years at outsight so far, he worked as a software developer, so he brings valuable real world tech experience to his role as CTO. You won't want to miss this fascinating conversation conversations by getting a sense for your experience and your background. So I would love if you could walk me through how you got to where you are now and what you're doing in your current role and outside.
Speaker 1:Yeah. So I think it's quite interesting because my background is very technical. I went to university learning about development and so on And then was into, like, website building. After that, then rolled into big data. So did a lot of big projects, big data projects, data analytics.
Speaker 1:And then basically, I saw an ad on Facebook that says code and serve. And then I went to California, went to Santa Cruz where Emmanuel, the founder of Outside, started with 1 villa. It's like 1 villa with 8 rooms in Santa Cruz and where we had a week of coding and surfing. And then I decided to basically start helping him on the website because at that time, we were very small. Right?
Speaker 1:We were just on Airbnb and then had some direct context of people staying with us there. And so that's how I got to know outside, and that's how I started helping outside. And in the first one or two years, it was more like a on the side job for me. And then it evolved to becoming, like, a full time CTO for outside, and then that's already 8 years ago now. So
Speaker 3:And I understand outside has grown quite a bit. Can you tell me a little bit about the business, about your business model? What makes you different from a standard Airbnb?
Speaker 1:Yeah. So we started in Santa Cruz with 1 villa and then quickly grew to 3 houses in California. In the beginning, we mainly focused on large villas, I would say, with the average of 8 rooms. And then we started to look at bigger and bigger properties. Like the first property we had in Europe was a small hotel in Portugal of 25 rooms.
Speaker 1:And nowadays, we even have a hotel in Porto with 60 rooms. I would say the sweet spot for us is between 20 40 rooms because what we aim to do is bring remote workers together in one place. Our spaces are really designed for remote workers and to build a community while they're there. And so if you would stay between 20 40 rooms, that still makes it possible for people to hang out with each other and to do activities together and so on.
Speaker 3:And I understand that technology is a big part of the experience as well. Can you tell me a bit about how a guest would use technology throughout their stay?
Speaker 1:Yeah. So in the very beginning, we had a very basic website with a form where you could just book your stay. So that was very easy, and that basically evolved very quickly to our own booking engine, our own website where we would sell our rooms. And that has always stayed like this because for us, it's very important that our members, because we also have a membership, that our members can book through outside and really be in touch with the brand from the start and throughout the whole process. So even at the check-in emails, they come from outside.
Speaker 1:When they stay in the house, there is a mobile app from outside. So we really try to make sure that the brand is throughout the whole journey. 8 years ago, it was not so easy to do that with the technology that was there. So we couldn't just take something off the shelf. Today, I must say it's probably a bit easier to achieve this with the software that is there, but back then, it was much harder.
Speaker 1:And also what we were doing was quite curious because it was not just one hotel. It was a network of properties, different kind of properties. We had a membership on top of this, so people would have to become a member first to then make a booking. And so we try to make this as seamless as possible through our own booking engine, and that's basically how it evolved to what we are today.
Speaker 3:And I think you previewed this, but I definitely want to dig into it more. You mentioned that you built your booking engine, and I understand that quite a bit of the tech you use is built in house. Tell me how that works, having an in house product team, which certainly is different than your standard hotel.
Speaker 1:Yeah. So it also became because I was a developer. So in the beginning, it was just me building on the website and building the booking engine and so on. And then at some point, we started integrating with CloudBets because what we were aiming to do was build a layer on top of our PMS to provide a very good experience to the members and everything underneath it. Like, we didn't wanna build a whole PMS because we didn't have the resources to do that, and that wouldn't make a lot of sense either.
Speaker 1:And so in beginning, it was just me. Today, we are a team of 3 in the product team. So it's myself, a developer, and a product designer. And so because of this small team, we are able to build a lot of in house. And today, it's still our website and booking engine.
Speaker 1:We also make our mobile app in house. And then everything that has to do with, like, sending emails, revenue management, and a lot of integrations as well.
Speaker 3:And what do you feel are the advantages to doing those things in house rather than working with a vendor or a third party?
Speaker 1:Well, it's much easier to really build it in the way we imagine it. Right? Like, one of the features that we have is that a member can really make a a trip. It's like a basket we have on our website. It's not something you typically see in a booking engine.
Speaker 1:Usually, you just book 1 room and 1 property and you add some add ons and that's it. With outside, you can really make a trip. So you could decide to spend a month in Portugal, followed by a few weeks in France, and then go to Bali for a few weeks. And you can all do that in one basket, add, maybe a membership if you are not a member yet, and then check out. So this is very tailored to the experience we want to bring.
Speaker 1:And then we can also layer other things on top of that. For example, you can see who you're gonna stay with in the house. So it's like a bit of a social layer we built in that as well. Having your own product team makes that possible. Whereas if you would have to work with either the booking engine from the PMS or other booking engine solutions, you would really have to, like, customize it a lot and it will never be where you want it to be.
Speaker 1:Or for the member or potential guest, they would feel like a very fragmented journey where first they're in touch with your website that has the beautiful branding. Then they go to the booking engine that already looks a bit different than the website, but still maybe has their logo. And then when they get a email, it looks a bit different again. We're really able to maintain our brand across these different channels, which is really helpful.
Speaker 3:For hoteliers who might not be familiar with how product would work within an organization, Can you tell me a bit about how your team decides what to work on, and who are the stakeholders you work with at OutSight? How do you turn everyone's ideas into features that you actually ship?
Speaker 1:So we're a fairly small team, I would say, in our HQ HQ is remote, so everybody's everywhere because we're, of course, eating our own dog food by being remote. Like, we're 15 people, and so the product team is a small part of that. We work very closely with marketing, of course, because in the end, booking engine is a sales channel. But we're also work a lot with our reservations manager to make sure that the rates that we sell make sense. And we also work a lot with the operations team more for the review management because we built our in house review management.
Speaker 1:So we receive a review after somebody stayed, and then that's communicated with the operations manager of that region and with the community manager of that specific property. So because of that, we're able to bring the feedback very quickly to where the customer was and also try to fix issues as soon as we can.
Speaker 3:You mentioned that you do use Cloudbeds. I know you don't use very many third party vendors, but Cloudbeds being your PMS, I imagine, is a very important system for your team to use. How did you choose Cloudbets, and what were the criteria you were looking for in a PMS?
Speaker 1:The moment we had to make this decision is already a while ago, and what we're talking, like, 7, 8 years ago. Back then, what I remember was the main criteria was it needed to be very easy to use. So for the people who had to work in it being mainly, like, the reservations team because we have a central reservations team, but also for the community manager to, like, check and see what's going on in the property. And then the biggest criteria was to have a good API. And I must say 7, 8 years ago, that was not the obvious criteria.
Speaker 1:Like, there were not a lot of senders back then that had a good API that was well documented and could help us integrate our website with the PMS.
Speaker 3:And are there any other notable third party vendors that you're using right now?
Speaker 1:Yeah. Today, we're in a trial with PACE revenue or floor revenue management because we have a very diverse amount of properties. And yet we only have one revenue manager because we want to be a very lean team, and it's very hard to understand the dynamics of each individual property. So we needed a bit of automation there and also a very good way to report on our properties. And so far, the trial has been quite good and quite interesting.
Speaker 1:So we have a few properties running on automation already. And what's nice to see is that they really use AI to do that. So it's not rule based. And so it really learns the behavior of each individual property and the way the pickup works for that property. And so we've seen some good results so far already.
Speaker 3:Can you tell me about the factors that went into selecting a system even just to do the demo? How did you narrow down all the revenue management vendors out there?
Speaker 1:So the revenue management software or all the options we are looking at today, it's fairly fresh because CloudAds only started integrating with revenue management software, like, fairly recently. I would say it started maybe, like, half a year ago, maybe a year ago now. And so our options were a bit limited because of that. Of course, the amount of options there is getting larger and larger, which is a good thing. But then it's really about why one price is, of course, important because we are not a very typical we're sometimes a bit a curious organization in a way that we have a lot of different properties.
Speaker 1:They're quite small. We're in a lot of different regions and different countries. And so even though today we have, like, almost 600 rooms, it's not all in one building. So for pricing, it's sometimes a bit of a curious conversation we have there. So that's one factor.
Speaker 1:And another factor is to really make sure that our revenue manager that it really becomes, like, a second revenue manager in the team and not something we need to manage and spend a lot of time on.
Speaker 3:I wanna talk about your mobile app. So most of the software we've talked about so far is sort of on the back of house side of operations. Talk to me a bit about your mobile app and your guest facing technology.
Speaker 1:Yeah. So we introduced the mobile app almost a years ago now, and the main goal was to enhance the guest experience from the moment somebody checks in because we didn't believe that having a mobile app would be the first thing somebody installs when they're not staying with us yet. So for new customers, and that level of entry to me seems pretty high to first install the app and then make a booking through there. So we're really focused on the guest experience. And so making it very easy to show your trips, see the check-in instructions of a certain property, see the local recommendations because we have a membership and our members get along very well.
Speaker 1:We made sure to have our own recommendation system. So we basically recommend, like, restaurants and cafes nearby, and it's our members that recommend these because we think that the quality of those recommendations are much higher than what you would get on just Google or Yelp. So that's an element of our app. Now we see more and more requests for actually being able to book from beginning to end through the mobile app, but we're not there yet. Right now it's possible to, like, explore our different properties and explore, like, the rooms in there, but not to completely make a booking from the mobile app yet.
Speaker 3:Do you have a sense for how many of your guests do download the app?
Speaker 1:Yeah. So it the adoption rate is quite high. I would say it's around 90% of our guests install the app. Yeah. And that was a positive surprise for us because we knew it was gonna really enhance the experience to check-in, for example, but we didn't think that the adoption would be that high.
Speaker 3:Did you offer some sort of incentive or, like, extra perk if someone downloads the app?
Speaker 1:No. Not really. It's really a matter of, like, we introduce the app after somebody makes a booking. That's the first moment we say, like, hey. Please install the app.
Speaker 1:This will really make your life much easier to find, like, the instructions to get to the house, but also to figure out who's staying in the house. I think that might be one of the reasons people actually install the app is just to see, like, who's actually staying with me right now, and then they can connect with each other. So that might be one of the triggers or one of the biggest triggers to actually install it.
Speaker 3:And is that feature being able to see who else is in the house? Is that only available through the app, or could someone see that on desktop as well?
Speaker 1:No. That's only available through the app. Yeah. Because we also think that was the right place to do it. In the very beginning, we still do it for some of our villas is that we had, like, a chalkboard in the house where we would have a list of, like, this is their room name and this is the person staying at that room, and this is the country where they are from.
Speaker 1:It's basically that part of the child work that we digitized into a mobile app.
Speaker 3:Can you tell me about any other guest facing tech, Like, check-in process, communication with your team, is that all handled through the app as well?
Speaker 1:For communication, we still use email. So that's something which we, at some point, would like to get into the app as well and make more into, like, chat friendly integration. But apart from that, it's mainly the website, emails, and then the mobile app. We also have a WhatsApp group for each house. This is actually an interesting point and debate we had internally is, like, should we move the WhatsApp group or the chat in the WhatsApp group?
Speaker 1:Should we make that part of the mobile app? And our conclusion was that it doesn't make a lot of sense because people are very used to being in WhatsApp groups. And so trying to move those to a mobile app is very, very hard. Like, we talked to several Collivin players that have tried to do this and they always failed. Usually, what happens is you would have the chats in the mobile app, and very quickly people would just gather with each other and create their own website group, and then everything would live over there again.
Speaker 1:So it's very hard to move that from the regular app where everybody does this day to day communication to a mobile app.
Speaker 3:Well, we've talked a lot about the tech that you are currently using today. I'm curious if there's anything on your wish list or anything that you hope to implement in the next couple of years.
Speaker 1:Yeah. Something we're experimenting with, like many other hoteliers, I guess, right now is the use of AI and chat gpt. Right now, we use it mainly to help with the reservations team and to filter out the communication that we get. So all emails right now that we're getting, we are categorizing them using chat gpt to make sure, like, booking inquiries get a different label. If there's something urgent, we detect that with AI, and that's also labeled differently so it can be picked up much quicker.
Speaker 1:So that's something we're experimenting with. The next step there is to build something that uses ChatGPT again. For example, if there was a booking inquiry, we can already prepare the email for the reservation agent, and that person only needs to review the email before actually sending it. So really making the lives easier of our agents. I think there is, like, JPGPT or other language models will make a big difference in that area.
Speaker 1:Something we could start experimenting with is having a chat with a customer that is also AI based. Although I believe a bit less in that because if you ask around, I don't hear many people in the room saying, like, I always chat with a bot. I like chatting with a bot or having a bot experience. So we're still trying to see what's going on in the industry there to see what's happening.
Speaker 3:Well, I'd like to switch gears and zoom out a little bit given that you are CTO at OUTSIGHT. I'm curious to hear 1 or 2 company level business objectives that you're working toward and how technology helps you get there?
Speaker 1:I think what definitely shifted in the last years because we were a startup, right, 8 years ago when we were definitely a part of the zero interest craziness, being able to raise money with DC and so on. And there was a big focus on growth, growth, growth. So it was really about, like, opening new properties and adding bets. Whereas today, and that shifted like 2 years ago when the interest rate started to go up, where the focus shifted towards like, okay, but now you also need to generate positive EBITDA. And this has been very challenging for a lot of companies, both public but and also where a lot of private companies.
Speaker 1:And that's basically what our challenge is right now, and we're moving in the right direction. So that's good. But that has definitely required, like, a mental shift within the team on how to look at certain things. Right now, it's really more about, like, optimizing. That's also why we look at things like price optimization.
Speaker 1:It's like how can we get more revenue out of the existing assets? How can we make sure we don't make certain mistakes by not having an eye on a certain asset at some point and losing revenue like that. So that's really the shift we've been going through so far.
Speaker 3:I'm curious to hear from you. What are a couple of skills that you think are crucial for hoteliers to have in order to be successful today?
Speaker 1:For my own journey, I've went from a developer to understanding the hotel industry much better. Like, my background was definitely not there, and it's very curious to see how things have evolved in the last years within the hotel industry. There's still a lot of legacy things going on. We're not talking about, like, distribution yet, but I see a lot of legacy things still going on on that front for sure. I think what's important today is to understand that people want a seamless experience, and they already used to it.
Speaker 1:Like, for example, at Booking dotcom, Airbnb made people or made customers used to have a very good online experience. So I think it's critical as a hotelier to offer that same experience. And I think today, it's possible. Like, today, there are multiple vendors that have the standards up to that level to achieve that same level of guest experience. So I think that that's the main learning, I would say.
Speaker 3:And you touched on distribution briefly as that's definitely an area of the industry where there's probably room for some innovation. Talk to me about how you approach distribution and outside.
Speaker 1:Yeah. So for us, it's also a bit a bit curious because the way we started was just direct sales. We just had our website, and that was the beginning of Airbnb. So Airbnb was our main channel. Today, we still drive 80% of our revenues through our direct channel, so through our website.
Speaker 1:And this is by doing a lot of marketing, doing ads on Instagram, working with influencers, having a lot of organic social content there because our reach also has grown over the last 8 years. So that's our most important channel. And then we also distribute to Booking dotcom and still Airbnb. But for us, that's a secondary and not the main driver. However, we would like to be more present on platforms that sell to corporate travel because the experience we offer works for remote workers, but also works really well for corporate travel where people maybe have to spend a few weeks or 1 week in a certain city, and they still want to have, like, a bit of their home base over there.
Speaker 1:And so, yeah, to distribute to those, it turns out to be very challenging. It's not made very much very easy.
Speaker 3:Is there additional software you would need to implement to reach those travelers, or how are you working on tackling that challenge?
Speaker 1:Yeah. So there, what we see is that you have to go to, like, the traditional GDS providers. And to even be listed through them, like, the requirements are already quite high. You already have to be, like, a bigger hotel with a certain ADR and so on. The the level of entry is already fairly high.
Speaker 1:And then it's still very tedious to manage all the inventory we have and all the content we have around this inventory if we want to distribute that to the different channels. Like, we're a small team. Like, it's impossible to keep all these content up to date across the different channels, and that's not so easy. Although even there, like, even today, I talked to a player that is trying to solve this. So maybe in a few years, it will become much easier.
Speaker 3:Well, last question, which is always a fun one. Curious to hear from you one thing that you believe about technology in the hospitality space that you think other hoteliers or peers in the industry would disagree with.
Speaker 1:I think a lot of people would disagree to create your own product team and to do some things in house and maybe hire a developer or somebody that is a bit more technical that can build things for you, that maybe can customize your booking engine, that can help you with everything, website, and so on, and hire that person in house versus hiring an agency. I think that could be fairly controversial for a lot of hoteliers. Yes.
Speaker 3:Any final thoughts before we wrap up? Anything else you'd like to share?
Speaker 1:What I really enjoy is it's very interesting to see where the hospitality tech world is moving towards. It's definitely modernizing at a very fast pace right now. So I'm very curious to see what the future will bring.
Speaker 3:So am I. Really appreciate your time, Stein. Thank you, and I hope you have a good rest of your day.
Speaker 1:Yeah. You too. Bye bye.
Speaker 2:That's all for today's episode. Thanks for listening to Hotel Tech Insider produced by Hotel Tech Report dotcom. Our goal with this podcast is to show you how the best in the business are leveraging technology to grow their properties and outperform the concept by using innovative digital tools and strategies. I encourage all of our listeners to go try at least one of these strategies or tools that you learned from today's episode. Successful digital transformation is all about consistent small experiments over a long period of time, so don't wait until tomorrow to try something new.
Speaker 1:Do you
Speaker 2:know a hotelier who would be great to feature on this show, or do you think that your story would bring a lot of value to our audience? Reach out to me directly on LinkedIn by searching for Jordan Hollander. For more episodes like this, follow Hotel Tech Insider on all major streaming platforms like Spotify and Apple Music.
