HotelTonight lands $3.25M in funding for last-minute hotels

Following a beta launch and subsequent expansion to 12 cities all on self funding, HotelTonight has closed it first round of funding, snatching $3.25 million. The round was led by Battery Ventures, including participation from Accel Partners, First Round Capital and travel industry veterans Rich Barton, Erik Blatchford, Brad Gerstner and Hugh Crean.
The San Francisco-based startup has had its last-minute hotel booking app downloaded more than 300,000 times since it launched in January 2011. Getting it’s start on Apple Inc.’s (AAPL) iOS platform, HotelTonight plans to use the new cash to expand to more mobile operating systems, add new functionality, engage in marketing campaigns and expand to more cities.
“We spent the company’s first six months building the world’s best way to book a same-day hotel stay and validated the market opportunity, both for hotels and for travelers,” founder and CEO Sam Shank said in a prepared statement. “We are thrilled to work with world-class investors to build the best brand in next generation travel. The additional funding will allow us to balance our focus on developing great technology with an equally important emphasis on sales, marketing and awareness.”
The company now counts long-term relationships with almost 200 hotels around the country and continues to offer a $25 credit toward new customers’ first bookings.
“HotelTonight is disrupting the online travel category by offering consumers a simple way to book great last-minute rates without the fear of the unknown,” said Brian O’Malley, partner and lead investor at Battery Ventures. “Besides providing pictures and detailed attributes of the properties, HotelTonight only works with a select group of hotels, so travelers can truly rest easy knowing they will have a great experience. HotelTonight is being led by a high caliber team and we’re excited to work closely with them to pursue the tremendous market opportunity ahead.”