Blueground, short-term home rental startup, gets $50M funding – Fast Company
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Blueground, short-term home rental startup, gets $50M funding – Fast Company

Blueground, short-term home rental startup, gets $50M funding

By Elizabeth Segran5 minute Read

For years, life went something like this: We’d would grow up in one place, head off to college, then find a city to live in for a few years at time to pursue a job or higher education. The end goal was to find somewhere to settle down for the long haul, buy a house, start a family, and begin the whole cycle all over again.

But a new model for living is emerging: Some people are increasingly opting to move from city to city throughout their entire lives, sometimes as frequently as every month.

Just ask Alex Chatzielefteriou, who has had a front-row seat watching this evolution unfold. Six years ago, he launched a startup called Blueground that rents out beautifully designed, fully furnished apartments for a month at a time, at rates that are cheaper than hotels. Today, the company has 3,000 properties in six U.S. cities, along with Dubai, Istanbul, London, Paris, and Chatzielefteriou’s native Athens, and a staff of 400. The company just landed $50 million in Series B funding, bringing its total investment to $78 million, to continue its rapid expansion. It hopes to have 50,000 properties in 50 cities over the next three years, and the goal is to make each one feel unique and cosy, rather than standardized, like what you might find in a traditional hotel.

Chatzielefteriou first came up with the idea for Blueground while he was working as a management consultant for McKinsey. “The accommodation of choice for consultants is the hotel,” he says. “I had to spend five years in a hotel room, living in 12 different cities. I loved seeing the world, but I didn’t love feeling like I didn’t have a home.”

[Photo: courtesy of Blueground]

As he spoke to his friends and coworkers, he realized that many people were frustrated with this itinerant lifestyle that meant living out of a suitcase in the same few nondescript hotel chains that all began to blend together. And what’s more, hotels aren’t a particularly cost-effective solution for companies either. In Chatzielefteriou’s case, McKinsey sometimes paid $10,000 or more for him to stay in a major city for a month, which was far more expensive than local rents.

But as Blueground has grown, Chatzielefteriou has found that people of all ages, professions, and walks of life are opting to skip a traditional long-term lease for a monthlong Blueground rental. Sure, there are plenty of consultants who use the service, along with people at companies like Samsung, Pfizer, or HSBC who send employees to cities for postings that last several months. But there are also people who move to a city for an extended medical treatment, athletes who spend several months in one city to train, actors who move to a city for a limited-run performance, and government officials who only need to be in the capital several months a year.

“The way many of us are living today is different from in the past,” Chatzielefteriou says. “We want to move frequently over the course of our lives, while still being able to come home to a comfortable space of our own, but there isn’t a seamless way to do that.”

And perhaps the most interesting use case is people who opt for Blueground instead of a traditional long-term rental, simply because they want the flexibility and convenience to move at the drop of a hat. These are people who may be tied to a company in a particular city but expect to change jobs every few years. Others simply don’t want to deal with the hassle of owning furniture.

“I’m 39 years old, and I have never owned a piece of furniture in my life, so I can relate,” Chatzielefteriou says.

With Blueground, Chatzielefteriou’s goal was to create unique apartments that made guests feel like they were at home. The company’s director of interior design, Jessica McCarthy, and her team of designers, creates unique layouts and designs for each space.

There are lots of quirky details. One apartment may have a little bar cart, ready for entertaining. Another has a breakfast nook. There’s art on the walls, along with plenty of cosy textiles, like throw pillows and blankets on the couch, perfect for a cosy movie night in. The kitchen is stocked with fun, curated dining sets that match the aesthetic of the rest of the apartment. The point is to design a space that feels warm, personal, and homey, even though it is only temporary.

[Photo: courtesy of Blueground]

The company just launched a new program called Blueground Bespoke that is an even more elevated take on interior design. Bespoke will follow a particular design framework. Each apartment will feature one wallpapered accent wall that will pull the focus, outfitted with vintage rugs sourced from Turkey, and juxtapose natural materials like cane and leather next to metals like brass and copper. And these apartments will also have high-tech touches: Each will be outfitted with a Mirror so guests can work out.

In some ways, the experience of booking a Blueground apartment is a little like scanning through colorful and unique apartments on Airbnb, except Blueground furnishes and manages all the properties. A customer opens the Blueground app, finds an available apartment in the city of their choice, then moves in the next day, if they choose. Once they’ve booked, they can choose additional services, like weekly cleanings. And another useful feature is that a guest can move from one apartment to another within a city.

It’s interesting to Chatzielefteriou that some customers choose to move apartments several times when they’re stationed in a city. For instance, a consultant might be sent to work with a client in New York for two months and choose to hop from one part of the city to another. In other words, many people don’t see the process of constantly moving as a burden but a privilege, as long as they don’t have to worry about the practicalities of managing furniture and Wi-Fi service.

“It’s an entirely new definition of home,” Chatzielefteriou says. “Someone might start the month in Chelsea then move to the Upper West Side by the end of the month. It’s all about flexibility and exploration. That’s how we want to live today.”