News

Richmond-based investment firm Harbert Growth Partners has led a $20 million funding round in WhyHotel, a District of Columbia-based company that operates temporary pop-up hotels in newly built, luxury apartment buildings.

WhyHotel was co-founded by Jason Fudin and Bao Vuong, who is originally from Richmond.

The company operates 100- to 250-room pop-up hotels in new apartment buildings, giving developers a way to earn money from units during lease-up while providing travelers with another lodging option that includes amenities such as a full kitchen.

WhyHotel is part of an innovation trend in the hospitality and real estate industry, said Tom Roberts, a partner with Harbert Growth Partners who is serving on the WhyHotel board of directors.

It can take developers 18 to 24 months to fully lease new luxury apartment units, Roberts said. WhyHotel shares revenue on pop-up hotel rentals with the apartment developer.

“The model is very profitable at the unit level both for WhyHotel and the developers,” Roberts said.

Harbert Growth Partners, founded in 2002, invests in emerging growth companies. Its previous investments have included Shipt, an online, membership-based grocery marketplace that was acquired by retail giant Target Corp. for $550 million in 2017. The company also has invested in some Richmond-based businesses, such as clothing retailer Ledbury.

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