2020-2021 Channex Annual Letter

Dear Channex community and supporters

I have decided to start an annual letter with an update on our progress and future plans.

Our mission at Channex is to provide connectivity to all corners of the world and make the future great for everyone.

2020 to Today

It’s exciting to look back and see how after 8 months of work we released our first connection with Google in January. We had one channel and one PMS connected!

Since then we have connected to Booking, Expedia, Airbnb and Hostelworld and work with nearly 20 PMS companies.

We also released Channex PCI to help tech companies get PCI compliant at an affordable cost.

I would like to thank all the PMS companies who spent valuable developer resources to connect to Channex and believe in the vision of a better way to connect channels.

Also to the OTA’s that gave us agreements to connect at an early stage: Booking, Expedia, Airbnb, Google and Hostelworld.

Of course none of this could be done without my CTO Andrew and the great development team! Building a brand new platform with a new a programming language (Elixir) was tough but rewarding!

Funding

Since selling my first company in Dec 2019 we at Channex are still self funded but many of our partners have concerns if we have the funds to carry out our ambitious plans for the industry.

Don’t fret, we have runway for 18 months and plenty of time to see the vision come to life. You will see soon some of our upcoming launches will be a massive hit in the market.

Why Channex Exists

Many people have asked me why I chose to get into the hotel connectivity space, my favourite was Richard at Mews who i quote loosely:

“Evan are you kidding me? Your going from PMS to Channel Manager where they probably won’t exist in a few more years”

Richard if your reading this, please let me know the exact words you used, this is how i remember it!

Some background: Mews is a leading PMS that has raised a lot of money and is killing it! They are building out a lot of their connections direct and don’t require someone like Channex.

I didn’t have a great answer at the time, just a feeling that while it is a competitive industry indeed with over 300+ technology companies all selling the same thing (Commodity Market!!!) It was stagnant and slow moving.

Most importantly was the lack of innovation.

Channel Management Space

Lazy Competition

The market and product is well known, but the incumbent players are fulfilling that demand in a lazy way. What I mean here is everyone is doing the same thing and some companies look more like sales and marketing company rather than a tech company.

They rely on technology and selling techniques that might be decades out of date. This can happen when an industry is stable with the current players just trying to steal each others customers with better sales or cheaper prices.

In Channel Management the competition is lazy because most products have been out for over 10 years and have a stable number of customers on their platform. Everyone sells the same way and with similar prices. Everyone attends the same trade shows and the same cold call approach to new sales.

Overlooked Industry

With the industry looking so competitive and most properties signed up with a channel manager already, it is an industry that is ignored by investors and startups since it looks to be too competitive. What has been overlooked is new business models that are viable today that were not a few years ago

• Servers are cheaper each year
• Hotels are used to how channel managers work
• Low end of market is underserved
• Most companies are moving upmarket

Stuck in Stasis

Successful companies can easily become a victim of their own success. Entrepreneurs build great companies, but after those companies become established they are likely to be managers and caretakers who are executing the status quo.

Currently the channel managers are all doing the same thing to attract a little bit more properties, trying to take a property from the competition by offering the same product a little cheaper or better.

Channel management today is the same as it was 10 years ago, selling a place to update multiple OTA for monthly fee.

Software business models change and channel managers have not.

Whats Next for Channex (2021)

You can look forward to some great innovation in 2021

Booking Engine

Taking longer than expected and was due in December 2020 (now) but looks more like Jan 2021. We take a twist on a product that everyone has and will offer it as open source.

Why Open Source?

Going back to my “Why Channex Exists” section, a booking engine is an extreme example of the same product offered the same way by over 1000 companies.

PMS offer it for free with their product, channel managers try to upsell it with their product, even OTA try to give it cheap/free if you use their platform. With so many available it’s crazy that you can’t customise a single one of them to your brand or style.

By leveraging our great Channex API we have built a free open source front end, that a PMS partner can take and change to suit their brand and/or property. We also open the market to the marketing agencies that sell beautiful websites to hotel but then have to plug in a booking engine that looks totally different!

Look out for the launch of the open source booking engine next month!

Direct to Property Version with Mobile App

We started 2020 with a B2B business model (Enterprise)of selling connectivity to PMS as a white label.

In January 2021 we will release our product for FREE for properties to use directly.

If you read our mission and read how they industry is lazy then this should come as no surprise! How else can we help all corners of the world get connectivity if we have to charge and use a sales force?

Why Free & Is it Possible?

It is possible or we wouldn’t do it right?

As i mentioned earlier there are some big trends ongoing in computing:

• Servers and storage is cheaper every year (Cost to provide the technology)
• Many properties are better in tech today than 10 years ago (Training & Support)
• Free means we don’t have large sales costs (Sales and Marketing savings)

Think about many of the tools you use today like Gmail, Github, Mailchimp, Dropbox etc. They all have a free version that is amazing value.

Channex will just leverage this trend.

Mobile App

Take a look in the app store and you wont find many apps for “channel manager” many of the big names are missing!

Maybe they think their big hotels don’t need a mobile app?

Anyway for the small properties an app is critical, since it is often the owner who does everything and they need an app to manage on the move!

If your a PMS please don’t feel left out, we plan to to offer you a white label version of our app!

Long Term Plans?

Long term 12+ months we hope to provide a true CRS for the industry, you can read the White Paper Here:

https://medium.com/channex/hotel-crs-2-0-white-paper-ced2f8597d61

As you can see we are open with our ideas and plans, ideas can be stolen sure but it’s execution that counts.

Exciting Times Ahead!

I hope you enjoyed this article and please reach out if you are interested to partner with us as a PMS/OTA. You can email me with evan@ or via linkedin.