cosi Secures €20M Funding for Short-Term Rental Innovation

Cosi Group Secures €20 Million Investment for Expansion

Cosi Group, a Berlin-based startup redefining short-stay accommodation, has announced a new investment of €20 million. The company presents a unique alternative to traditional boutique hotels and fully-managed apartments.

Investment Details

The funding round was led by Vienna-based Soravia, a prominent real estate group operating within German-speaking regions. Existing investors, including Cherry Ventures, e.ventures, Kreos Capital, and Bremke, also participated in this round.

Furthermore, a cohort of individual investors contributed, notably the founders of Flixbus, Travelperk, Comtravo, and Cosi’s own founding team.

Strategic Use of Funds

The newly acquired capital will be strategically allocated to accelerate Cosi’s international expansion across Europe. This includes the implementation of a refreshed brand identity and the imminent launch of a new strategic business unit.

Cosi’s Business Model and Pandemic Resilience

Initially positioned as a tech-driven, “full-stack” hospitality provider, Cosi competes with high-quality boutique hotels and professionally managed apartments. The company secures long-term leases on properties and then personally manages the furnishing and interior design.

Cosi emphasizes the digitization and automation of its processes to ensure scalability and consistent service quality throughout the entire guest experience, from initial contact to fostering customer loyalty.

Thriving During Challenging Times

According to Christian Gaiser, CEO of Cosi, the startup not only weathered the challenges posed by the pandemic – including extensive travel restrictions and lockdowns – but actually experienced growth.

This success was attributed to the company’s ability to identify and capitalize on “new demand channels” that were not dependent on typical holiday travel or short-term business trips.

The Rise of “Midstay” Demand

Cosi observed a significant increase in “midstay” guests – individuals staying for a month or longer. Examples include those needing temporary housing while searching for long-term apartments, people seeking alternatives to shared living spaces, or families facing delays in home construction or renovation projects.

“We achieved over 90% occupancy and operated our locations on a cash-flow-positive basis,” Gaiser stated. “This experience highlighted the importance of focusing on controllable factors and proactively activating new demand streams.”

Shifting Preferences and Increased Supply

The pandemic also accelerated a shift in consumer preferences, with a growing preference for individual apartment-style accommodations over large, conventional hotels.

Simultaneously, Cosi has benefited from a surge in available properties, particularly underperforming hotels, presenting attractive acquisition opportunities.

The contraction of office space demand has also led to offers to convert office buildings into midstay accommodations.

Future Growth and Expansion

“Our strong performance during COVID-19 has fostered trust within the real estate community, resulting in an increasing number of proposals,” explains Gaiser. “Supply prices have decreased, sometimes substantially, depending on the location.”

Currently, Cosi has 750 units under contract, with an additional 1,500 in negotiation.

Gaiser concludes: “This is the ideal moment to reinforce Cosi’s long-term growth strategy. When others are hesitant, opportunities arise for those with a clear vision. Our investors recognize this, having witnessed the resilience of our business model and our ability to navigate both favorable and challenging conditions.”