Selina, a hotel and experiences brand focused on youth travelers, said on Wednesday that its financial metrics were trending in the right direction as it reported earnings results.
25.08.2023 - 13:19 / skift.com / Sean Oneill
Selina, a hotel and experiences brand focused on youth travelers, said on Tuesday it had cut a deal for a strategic investment of up to $50 million led by Global University Systems (GUS), which runs for-profit universities.
“They [GUS] are coming in for a long-term play,” said Rafael Museri, co-founder and CEO, in an interview with Skift. “They have more experience than us in how to build a successful operation in multiple countries, and we’re touching the same target audience.”
The extra capital starts with $10 million right away. That will help the balance sheet of Selina — a growth startup that has struggled to become profitable after going public last October.
On Tuesday, the company revealed it had suffered a net loss of $30.3 million on revenue of $54 million in the first quarter. It had $23 million in cash as of March 31.
Selina said on Tuesday it planned to cut about 350 full-time employees by October. It has closed five properties that contributed to 41% of its unit-level operating losses last year.
Selina debuted at $9.75 a share last October; it closed Monday at about $1.20.
Selina and GUS appeared to be still working out the details. But both pointed to potential collaboration. GUS said it serves about 100,000 full-time learners a year, plus many more through online education. At the simplest level, it could cross-sell its in-person and online learners on visiting Selina’s properties.
“Selina’s properties, many of which already exude the vibrant atmosphere of university campuses, are extremely relevant and embody the future of lifelong learning,” said Aaron Etingen, CEO of GUS. “Our vision is to push the boundaries of conventional education by delivering accessible learning opportunities across the globe.”
GUS, a privately held business majority owned by Etingen, has weathered many storms since 2013.
“They’re incredible, detailed operators with a very successful business,” Museri said. “They’re operating for the same target audience. They understand the values of those generations. They’ve got hundreds of partners who help sell their programs worldwide.”
Selina said Tuesday that its first-quarter revenue was up nearly 32%, partly boosted by an 11-point rise in average occupancy. Its net loss had also narrowed.
Museri said he was proud of the company’s progress in improving its cash flow picture. Excluding certain items, Museri said the company had negative $8.5 million in first-quarter free cash flow, compared to negative $16.9 million a year earlier.
Selina was one of about a dozen travel companies that went public in the past two years by merging with blank check entities known as special purpose acquisition companies (SPACs). Investors have cooled on these companies.
Museri blamed
Selina, a hotel and experiences brand focused on youth travelers, said on Wednesday that its financial metrics were trending in the right direction as it reported earnings results.
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