Blackstone has announced its plans to acquire a majority stake in hotel accounting tech company M3, marking their entry into the travel tech industry with more deals likely to come. The Asian American Hotel Owners Association is also making their first-ever investment alongside Blackstone in this venture. Based in Georgia, M3 offers back-office hotel software for accounting, labor management, and business intelligence, with over 1,000 hotel operators and management companies as clients, representing more than 8,000 properties in North America. This acquisition is being made through Blackstone Growth, their strategic growth equity business, which previously invested in Hotel Engine and now adds M3 as the second travel tech company in their portfolio.
Ramzi Ramsey, managing director for Blackstone Growth, expressed excitement about the potential for growth in the travel tech category. With previous investments in companies like Cloudinary and Dynamo, along with the acquisition of Cvent for $4.6 billion, Blackstone is positioning itself as a key player in this market. This investment in M3 represents the company’s first equity investment, with the goal of driving future growth for the business. Plans are in place to introduce new back-office products for hotels, as well as utilizing Blackstone’s hotel portfolio, which includes brands like Motel 6 and Extended Stay under G6 Hospitality, to promote M3 to their property owners and operators.
The immediate focus for M3 post-acquisition is to capitalize on the existing products and push for growth within the Blackstone hotel business, which can provide valuable feedback and insights for further development. With many AAHOA members owning only one hotel and remaining one of the last groups to digitize their operations, the potential for market expansion is significant. Individual hotel owners rely heavily on trade associations like AAHOA for guidance and recommendations, making their first investment in M3 a crucial endorsement for the company’s services. The partnership with Blackstone and AAHOA signifies a strategic move to penetrate this untapped market and bring digital transformation to a traditionally offline industry.
The financial terms of the deal between Blackstone and M3 have not been disclosed, signaling a shift towards shareholder liquidity for M3, as the company is already profitable. The primary focus for Blackstone is to drive growth and expand the business, potentially introducing new products and services to cater to the evolving needs of the market. Leveraging the extensive network of Blackstone’s hotel properties and reaching out to individual hotel owners through AAHOA presents a unique opportunity for M3 to scale its operations and solidify its position in the industry. By aligning with industry leaders and trusted associations, M3 is poised for accelerated growth and market penetration in the competitive travel tech landscape.
Overall, the partnership between Blackstone and M3 represents a significant opportunity for strategic growth and expansion in the travel tech sector. With Blackstone’s expertise in equity investments and M3’s established presence in the hotel accounting tech industry, both parties stand to benefit from this collaboration. By leveraging their respective strengths and resources, Blackstone and M3 can drive innovation, introduce new products, and tap into untapped markets, ultimately shaping the future of the travel tech industry. The acquisition of M3 marks the beginning of what could be a series of successful ventures for Blackstone in the travel tech space, with a focus on driving growth, profitability, and market leadership.
