Hotel Engine Inc., the operator of a hotel booking platform for business travelers, today announced that it has closed a $140 million Series C funding round.

Private equity firm Permira led the investment at a $2.1 billion valuation. That’s up from the $1.3 billion Hotel Engine was worth following its previous raise in November 2021. The startup says that it has spent only $20 million of its venture funding to achieve the $800 million valuation bump.

Denver-based Hotel Engine operates a cloud service that companies can use to book accommodations for employees embarking on business trips. It provides access to rooms at 750,000 hotels through a search bar that can filter results by property type, amenities and other criteria. It’s possible to book accommodations for individual travelers, groups or events.

Hotel Engine differentiates its platform from the many other business travel tools out there by offering several financial incentives to customers. Companies don’t have to buy memberships or sign minimum spending commitments. Additionally, Hotel Engine provides the ability to cancel and shorten trips without incurring financial penalties.

The company also offers more conventional incentives. Purchases are worth points in the royalty programs of both Hotel Engine and the hospitality companies that list their properties in its platform. Additionally, the software maker provides discounts that it says can reduce the cost of a hotel stay by up to 60% in some cases. 

“They’ve figured out how to provide the benefits of managed travel without the downsides such as contracts, minimum spend requirements and extra support fees, and they’ve also created a business that appeals to both travelers and suppliers like hotels, airlines and car rental companies,” said Permira principal Alex Melamud.

Alongside its cost-cutting features, Hotel Engine provides tools for speeding up the administrative work involved in business trips. One tool allows companies to consolidate multiple hotel bills into a single invoice to simplify accounting. There’s also a feature for managing incidental deposits, which are used to cover hotel expenses not included in standard room charges. 

Hotel Engine says that its platform is used by more than 40,000 customers, including PepsiCo Inc., Whole Foods Market Inc. and other major brands. Those companies rely on the software to plan business trips for about 700,000 workers. Hotel Engine says that bookings on its platform are on track to exceed 10 million room nights this year.

Alongside its flagship travel platform, the software maker provides a free business management application for hotel operators. A hospitality company can use the latter product to bid on group travel contracts and run marketing campaigns. There are also features for related tasks such as comparing a hotel’s performance with rivals. 

Hotel Engine disclosed on occasion of today’s funding milestone that its annual revenue growth rate exceeds 70%, off an undisclosed base. Moreover, the company is profitable. 

To maintain its business momentum, Hotel Engine plans to expand its platform with features for booking flights and rental cars. The new capabilities are set to roll next month. In conjunction with the update, Hotel Engine will become simply Engine as part of a rebrand meant to reflect that its focus is expanding beyond hotel bookings.

Image: Hotel Engine