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The HotelTechInsider podcast interviews the top leaders at the convergence of hotels, travel and technology. Guests include founders, executives, top hoteliers and industry organization leadership. Find all of the episodes at hoteltechreport.com
AI voice is a guest facing solution, and it needs to unify, it needs to integrate, it needs to work with all the other digital guest facing touch points that you have as well. Our perspective is that you wanna have a unified digital guest experience.
Speaker 2:From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them. Today on the show, we have Harman Nawula, the CEO and cofounder of Canary Technologies. Canary is the leading guest journey platform having won multiple Hotel Tech Awards over recent years and is building a comprehensive, simple to use digital guest journey platform. Canary recently raised $80,000,000 to take their vision to the next level. So we're really excited to have Harman on the show today.
Speaker 2:Harman, thanks so much for coming on the show.
Speaker 1:This is long overdue. Yeah, of course. Thanks for having me, Jordan. Excited to be here.
Speaker 2:So I remember, it must have been like 2018 or 2019. We were very early in the business. You were trying to convince me on creating a contactless check-in software category. You were probably the four hundredth founder to tell me that I needed a new category on the site. We already have 60 categories of software on the site and I think we need less, not more.
Speaker 2:But I will give you credit. You were the one person who was actually right about the category creation. So congratulations. Going back then, love to talk through the Canary founding story, how you got into this business, how you identify the problem, and what the v one product was and what the vision for Canary was at the outset of the business.
Speaker 1:Yeah, sure. Happy to kind of rewind. And I'll give you credit. You wanted to wait at that point, see kind of it play out a little bit, which I think made sense. But the guest facing solutions have definitely become a critical piece of the tech stack.
Speaker 1:It's nice to have seen that play out. But happy to kind of rewind a little bit in terms of how we got our start or kind of where we got our start and kind of how we built the business. So myself and my co founder, Ash Jay, we're actually childhood friends. And so founding story, it's kind of funny. We always tell people that our parents were actually friends when we were really young, before we could even talk.
Speaker 1:And so we were kind of forced into being friends, and then we decided to kind of stay friends. And we grew up as kind of best friends. And we always tell people like, you know, everyone has that friend where they like call them when they have an entrepreneurial itch or an idea, and you kind of work through with them and they kind of poke all the holes and you're like, oh yeah, it's a crazy idea. So we were always that person for one another. And so we were constantly kind of chatting about different ideas and so forth.
Speaker 1:And so I kind of fell into hospitality, to be honest with you. I have a background in hospitality. So I went to the hotel school up at Cornell, a little bit just from serendipity, really enjoyed that experience. I also spent kind of early part of my career at Starwood. So prior to the Marriott merger, focused on a bunch of different types of strategy work there and really enjoyed that experience.
Speaker 1:And then I also worked in management consulting post business school and spent a lot of time on hospitality technology and private equity software work. And my co founder, SJ, he actually been working at he was a serial entrepreneur. He'd been working on or he'd been working at another hospitality technology company right before Canary. Focused on a different space, but he had also gotten pretty deep into kind of hotel technology. And so now all of our conversations were about hotel tech and what's kind of going on, and that's where kind of things bubbled together.
Speaker 1:We both lived in San Francisco at the time, And then that's where things kind of bubbled together in Canary or the idea of Canary was born. We had this thesis around technology and kind of the guest facing technology and hospitality. Now we thought the tech stack was going to change. Right? Something I knew very deeply and SJ had spent a lot of time kind of digging into the systems as well.
Speaker 1:And so we had this thesis around it, but I think both of us, we kind of think of ourselves as, if you want to call it practical, kind of risk averse type entrepreneurs. And so we said, hey, we have to earn our right to be able to service this vertical. Right? And so from our point of view, we thought it was pretty difficult to go in and say, hey, we're either going rip and replace a core system that you're already on or deliver you kind of new core system that you should put everything on. We actually thought of it as, hey, we need to solve specific pain points and workflow issues that you guys have today and earn the right to solve additional problems for you as well.
Speaker 1:Right? And so we actually started as you mentioned, we started in this space called digital authorizations. And what that did was it helped with a specific use case that hoteliers have around card not present transactions, whether that's on the sales and catering use case, when they're doing group bookings, or if it's on any use case where somebody's booking for somebody else, maybe it's a travel advisor, travel agent type booking, or a guest is paying for another guest. It's a surprisingly large amount of revenue at hotels that was actually being processed on these paper forms. They were called credit card authorization forms.
Speaker 1:And so that was the first area that we started the business in because we thought that was like a true kind of point solution workflow that we could solve pretty quickly. Entrepreneurs, ever optimistic. Obviously, once you get into something, nothing is simple, especially when you're into specific kind of payment workflows and so forth. And so it was hairier than we thought, but that was a blessing in disguise because that made us kind of go down these pretty more complex rabbit holes amongst the within the ecosystem and integrations with other players and so forth. And so we launched that solution.
Speaker 1:We grew pretty quickly on that. It was a pretty activated hair on fire type problem for hoteliers. And, you know, it's pretty much off of the races there. And so we started kind of building out the customer base and we raised some capital, went through Y Combinator. And then with this thesis of, hey, we're gonna kind of build out more of the suite.
Speaker 1:And then we slowly kind of built out what we now call the guest management system, which was this guest facing platform for every digital touchpoint that the hotelier has with the guest. So that's a little bit of kind of the origin story in terms of how we ended up building out the full platform.
Speaker 2:When did it start to expand beyond digital authors? I'm gonna be totally honest. When we first had that call, I didn't know what a digital authorization was. I didn't really fully understand how the payment layer works or those transactions. Was an important in my hotel career.
Speaker 2:What was the next product after digital authorizations? And was that mostly customer driven?
Speaker 1:Yeah, it's a great question. So I think that's one of the pieces of domain expertise is really important, right? Is that this was an embedded kind of deep buried problem that hoteliers were facing. And so we were able to kind of like tap into that specific need that they had and solve that. And I think that also got us a lot of trust with our customers and that they were, hey, this is a nuanced problem.
Speaker 1:These guys know the industry. They provide a really simple way to solve this problem, and that was really helpful for them. We built some stuff around that workflow to enhance it, we'd still provide that. You know, we're a leading provider in that space. But it was actually around the time of COVID that we had this thesis and this roadmap around guest facing technologies that we wanted to do.
Speaker 1:We weren't quite sure when we wanted to expand, when we were going to expand from that initial solution and workflow set. But we saw COVID as kind of a great opportunity to do so, to be frank. Right? It was like we were talking to our customers. We're learning about, you know, what needs do you have?
Speaker 1:What problems are you facing? What would be very helpful right now? And we saw that really nicely align with this kind of like longer term thesis that we had on the market. And so we took the opportunity to layer the cake or, you know, expand from the wedge essentially and launch parts of the guest management system. And that was about the time that I called you and said, hey, I think this contactless thing is going to be big.
Speaker 1:Think I hotels are gonna really think about, you know, the guest facing solutions and that layer of technology. And so that's around when we started to really expand from our initial solution to the broader platform.
Speaker 2:We were talking about the adoption curve in guest management solutions a little bit before this call. And I'm curious, how would you describe your earliest Maven customers to the customers that are coming in today? And where are we on the adoption curve? And how has the buyer profile changed? I mean, down to age or job title, things like that.
Speaker 2:How would you describe the evolution of the buyer of a solution like Canary as you guys have evolved alongside the market?
Speaker 1:I think this is a really interesting topic that we think and talk about a lot in just, like, how the GMS, the guest management system, is working its way through the market or technology adoption curve, the standard adoption curve, right, kind of the innovative, the early adopters, the early majority, the late majority, and then the laggards and so forth. I do still think it's transitioning from the early adopters to early majority part of the curve. And so now we're starting to see kind of the chunkiest part of the adoption curve. And I think people are starting to ask themselves also like, am I a late majority? Am I a laggard?
Speaker 1:And so we're starting to see customers that are they feel like they're behind and so forth. So I still think on the guest management side, we're probably on this, like, early adopters, early major the early majority now because you're seeing a lot of the enterprises and the large brands that have portfolios of hotels across limited service, mid scale, full service resort, etcetera, luxury, really embracing and adopting full kind of guest management system platforms. And so I do think it's you know, we're transitioning into that majority phase at this point. The one interesting point that I'll call out here, though, is that hoteliers also, I think, like, are different parts of the curve for different parts of their business. Right?
Speaker 1:And so there are certain segments that I think have always tried to be innovators and certain brands that have always tried to be innovators and kind of push the experience. Right? I think I remember almost a decade ago, Citizen M was kind of a brand that was really pushing forward and so forth. And so their portfolio made sense for that. And there's certain parts of the portfolio for each of the large brands that make sense to be the innovators.
Speaker 1:And then there's other parts that they tend to be late majority kind of laggards as well. So I think that's an interesting nuance as well in that even within large portfolios, they can be at different parts of the adoption curve, if that makes sense.
Speaker 2:Obviously, you guys have done an amazing job breaking in with brands like Wyndham that were previously viewed as impossible to break into. Do you see a change in how chains are evaluating and buying technology?
Speaker 1:Yeah. I think there's been a pretty strong swing of the pendulum to saying, hey, we want to bring in kind of best in breed technologies. I think there's a combination though. There's certain pieces that brands should and they want to build themselves or they believe that they should build themselves, which I think is fine. But I think there's a lot of pieces of the rails and the speed of iteration that folks like us bring to the table that a lot of the brands are recognizing.
Speaker 1:Right? I think one thing to think about a little bit differently here is that a lot of the guest facing solutions are really it's b to b to c technology. Right? The guest is kind of the end user of the experience, and the speed of iteration that's needed to kind of continue to meet the demands and the desires of the guest is really quick. And so someone like us has the DNA where we can kind of bring that in and meet that needs and meet the speed of the iteration that's needed to kind of optimize for the guest experience.
Speaker 1:And I think a lot of brands are recognizing that. I think they're thinking about how do I do best in breed for that guest facing layer of technology? And maybe some of the rails, some of the core data pieces I wanna make sure that I still own in house.
Speaker 2:Are there clients that come to mind for you? Obviously, they're all great clients. Are there specific hotel groups that you just think are operating at next level in terms of innovation? Like the Citizen M of tomorrow, basically, that is taking your software, pushing it to the limit, and then bringing you guys even new ideas?
Speaker 1:Yeah. It's a little bit like asking you which of your child is your favorite. I think each brand is doing it a little bit different. They're doing it in different ways, frankly, different brands that we work with. There are some folks that they are power users that they want to connect circles.
Speaker 1:They want unified guest communication for the entire guest journey. Right? So they're thinking about voice and messaging, etcetera, how it all kind of connects. And so they're thinking about it kind of full circle, and they're looking about surface area expansion. So, you know, I do these things.
Speaker 1:I wanna continue to do more and more touch points with the guest. There's other brands that I think are really thinking about within solution sets. How do I leapfrog or how do I get to innovative features within that feature set as opposed to expanding the number of things that I'm doing for guests, if that makes sense. Right? So they're going deeper and trying to innovate deeper on solution areas.
Speaker 1:And other brands are saying, hey, I want to touch the guest in more places and do more things and give them more opportunity to engage with us. And so I think the innovation is happening in a lot of different ways and a lot of the different brands are doing a lot of different things. And the brands that are ahead of doing some of this also have invested years on their core platforms, to be frank. Right? I think the big shift that happened to cloud and brands that have been investing in that for the last decade are now at a place where they're able to kind of move more quickly on the solutions that they're bringing on.
Speaker 1:And I think the same thing is happening now that's going to impact some of these brands over the next ten years. Right? So folks that are adopting guest facing type platforms where they're able to iterate with them, they're gonna have a leg up five and ten years from now again because they're gonna get to innovate on top of that platform. Honestly, we're already seeing some of that to some degree.
Speaker 2:So you guys have evolved the products line, you know, adding, upselling, messaging, digital tipping, now AI voice. I'd love to talk through some of where those products are at. From a digital tipping perspective, out of curiosity, there's no tax on tips in The US. Is this driving any kind of adoption or interest in that product category?
Speaker 1:Yeah. I mean, I don't know specifically that piece of legislation we've seen that really play through the system yet, frankly. But there's definitely been talk of it. It comes up in conversations with hoteliers and so forth and staff members. Digital tipping has been a really interesting one, to be honest with you.
Speaker 1:I think like, we're the largest player in that space as well. And I think one of the core pieces is that it's a natural fit for kind of what the digital guest journey looks like, right? As your own property or as you're leaving property, it's a nice opportunity to reward the folks that have been delivering fantastic service to you and going out of their way to do so. And frankly, predominantly in North America for the last last year or last kind of eighteen to twenty four months, as you're probably very aware, it was a huge need. It was kind of on fire type solution.
Speaker 1:Folks, everyone wanted to find a way to get a digital tipping solution. And I think it was a number of compounding factors that kind of came together at the same time. Obviously, shortages. I think people wanted more ways to kind of reward their team members, retain their team members. And then guests also, they were finding ways to reward the folks that were providing them fantastic service.
Speaker 1:And there was a survey, I think, that had come out in the Wall Street Journal as well that had basically said like, one of the areas that people wanted to or they're most likely to want to tip was actually hotel like hotel housekeeping staff because they felt like that was a job that like they were actually doing a lot for the guest and they weren't necessarily getting the recognition or the credit around it. And so a couple of these factors came together and I think it was just a solution that felt like a must have for most hoteliers for the last kind of eighteen, twenty four months.
Speaker 2:Pivoting a little bit to the AI side of things, AI voice, like what stage would you consider that product in? Are the main use cases for collecting reservations at this time? Or is it more front desk calling and getting service in house?
Speaker 1:Yeah. So there's a variety of use cases for AI voice. We're super excited about AI voice. We're doing a lot of work around this with a number of our brand partners. You know, I think the performance there is just kind of phenomenal.
Speaker 1:Right? If you look at the total number of calls that are being missed at a hotel, right? At the end of the day, hospitality businesses, people like to call in and get information. And so 30 to 40% of all calls actually at hotels are being missed. Right?
Speaker 1:And then if you kind of double click into that, you start to see that actually, you know, almost a third of those calls that that hoteliers are getting are actually booking related calls. And so this is money that's being left on the table by hoteliers. Right? And so that's painful for, you know, owners and operators to hear. And so AI helps solve a lot of this.
Speaker 1:Right? You answer every single call. And it doesn't mean that you don't have to have a human in the loop at any point, but the vast majority AI is kind of able to handle A to Z. And then there's certain cases where you may want to do a handoff to a human. And so we're seeing phenomenal results on the AI voice side.
Speaker 1:We're pretty excited about that. A lot of our hotel partners are pretty excited about that as well. The use cases vary to your point. There's booking related things that are happening. There's operational related things that are happening.
Speaker 1:There's discovery related guest use cases that are happening. And so AI voice has just a number of use cases that are really, really well set up for the hospitality industry.
Speaker 2:Are you guys integrating that mostly with enterprise customers right now? Or are using Canary Voice as well?
Speaker 1:No. We're seeing independent properties as well really starting to engage on this as well and get up and running on it. You know, the time to live for them is pretty quick. Right? They have some core stuff that they want to train on and then they kind of want to get off to the races and get started.
Speaker 1:They don't have as many as kind of the workflows that they need to work through before they feel comfortable getting something up and running. And so we're seeing a lot of them also. There's a lot of excitement from them in terms of getting live. And then on the enterprise side, yeah, we're working through that with a number of folks. There's a number of projects that are currently launched where they have some more complex workflows.
Speaker 1:And so they're doing kind of phased rollouts of, hey, let's solve this use case, let's solve this use case, and so forth.
Speaker 2:And from the voice perspective, I feel like I've seen a few different approaches. Like I've seen a couple of PMSs trying it. I've seen a couple of independent multi vertical horizontal type AI call center software. And obviously you on the guest side, I've seen one kind of more website development, direct booking optimizations company doing something in the space. Who do you think is best positioned to be that player that delivers the AI voice solution?
Speaker 2:And how do you see those different types of approaches to it playing out over the long term?
Speaker 1:Yeah, I have a hypothesis that you probably know my thoughts or my response on who I think is best suited. But I think, look, I think fundamentally, AI voice is a guest facing solution. And it needs to unify, it needs to integrate, it needs to work with all the other digital guest facing touch points that you have as well. And so our perspective is that to the example that we gave earlier is that you wanna have a unified digital guest experience. And so that means kind of whether that's a handoff between voice and messaging and in person, you need kind of one provider that is kind of the backbone of that digital guest experience.
Speaker 1:And so we believe that the guest facing layer of technology that hotels are utilizing will and kind of are going to be able to provide more personalization and context for those conversations with the guests than other players in the market. I think the activity is super exciting. Right? I think that is recognition that this is something that can be really beneficial and can really help drive an elevated guest experience, streamline the operations for hoteliers. That tends to be our perspective on why we think guest facing players are really gonna be the ones that should be delivering this
Speaker 2:to hoteliers. And are you guys more dependent on CRM databases, like B2C CRM databases, or the PMS? Or is it like a combination of both?
Speaker 1:It varies. The succinct answer there is that it's combination, not only CRM and PMS and so forth, but there's other systems also that hoteliers are pretty keen on ensuring that full context on the guest is received. So kind of three sixty view of the guest. The AI is informed with the three sixty view of the guest. And so a lot of them have some of their own proprietary systems that they've actually built, and they're capturing data there outside of a CRM and a BMS.
Speaker 1:So there's integration there that's also important. So it's a combination, but the connectivity within the full ecosystem is super important to be able to provide the most personalized experience for the guest. For sure.
Speaker 2:How do you see the PMS, CRM? Some people are saying that like, oh, CRM, CDP will be more important in the power curve than the PMS in the future because that's where the guest data lives. How do you see that kind of, I guess, friction playing out in the future from where you're sitting?
Speaker 1:Yeah. Look, I think that there's different types of hotels that need different types of tech stack, to be frank. Right? I think there is certain players in the market that they can truly take advantage. The other piece is that you know, having systems for the having system's sake is not necessarily beneficial for hoteliers.
Speaker 1:Right? It's like, if you have a CDP, are you to what degree are you actually utilizing that, or are you kinda pushing data and it's kinda sitting there with potentially some future use case that you think you're gonna utilize it for? And so I think when it boils down to technology for Atelier is it's a little bit of like, you should be utilizing the systems or you should be thinking about utilizing the systems that you're going to also be able to put in and kind of engage with the most as an organization. And so I think it varies by brand in terms of their levels of sophistication, also in terms of what they're going to be able to utilize. But we are seeing a lot of the folks, a lot of the brands pretty zoned in on, hey, we want to be the owners of the central repository of our data, whether that's going to be pushed into our CRM, whether that's going be pushed into CDP, whether we have a generic lake that we're going to push everything into and then we're going to figure out what to do from there.
Speaker 1:The central repository of all the data from every core organ of the Hotel Tech Stack, I think has become a pretty critical need for folks.
Speaker 2:And as you think about what's next in the coming years for Canary, obviously you guys have layered digital authorizations into upsell messaging, digital tipping, AI voice. What do you see coming next? And how does the platform kind of round out over the next, call it, eighteen, twenty four months?
Speaker 1:The way I think about it is like the canvas of the digital guest journey is pretty wide. Right? There is lots of different touch points that hoteliers want to engage with guests on. And there's a lot of different things that they want to be doing with guests on those different touch points. So you'll continue to see us basically trying to meet the moment for hoteliers where we're providing them the solutions to be able to hit the guests at every different touch point that they need, as well as go deep on each of those different touch points for the different capabilities that they want to offer.
Speaker 1:Think digital tipping was a really interesting one over the last twenty four months where hoteliers are like, hey, I want this as a capability that I want to provide to my guests at a few different points in the guest journey. And so I think you're going to continue to see more and more things like that as the pull is coming from consumers and the guests like us as well. For sure.
Speaker 2:Do you see more of a convergence between b to c and b to b? Because you're presumably touching b to c hotel sales, customers, groups, mice, things like that. You see the guest experience technology eventually moving more over there as well because it's kind of a similar type of motion, but maybe with more bulk sending and personalization at scale.
Speaker 1:Yeah. Frankly, a lot of it's there already, right? Fundamentally, at the end of the day, like a guest stay is always, whether you're coming in for a group or whether you're coming in for a leisure trip or bleisure, I think is like the hot term over the last couple of years in the industry, like regardless, like, a guest stay is always pre arrival, in stay, post stay. Right? And so we've already seen that, you know, regardless of the type of stay or where you came in from, they're utilizing guest facing technology.
Speaker 1:And so I think we'll continue to see the push from guests for more and more digital opportunities to connect with the hotel.
Speaker 2:So there's one thing I always end our interviews with, which is asking, when you look around the industry, what's one thing that you think many hold to be true that you disagree with or vice versa? What's one thing where you're like, everybody's doing this wrong or most people are doing this or thinking about this wrong? And I think that will shift over time.
Speaker 1:That's a great question. I have one that I don't know if it's necessarily that everyone's doing something wrong, but I'd say, like, maybe a little bit of a contrarian view to some degree, very applicable for hotel tech is that I think there's, like, kind of generally, and, you know, there's a lot of talk, especially from folks that are providing technology to our earlier conversation in terms of kind of entrepreneurs and stuff. I think there's a lot of talk around how, like, hotels have these massive gaps and these big problems and their technology is outdated and so forth. This kind of this is like a little bit more negative view in terms of where hotels are with technology. I think I take a little bit of like the opposite view of that, the other side of the coin.
Speaker 1:Like, I actually think hotels have know, they've done a good job. It's a people first industry. And if you kind of like zoom out a little bit, I remember, you know, when I worked in the industry or kind of when I was working at a hotel company, the level of technology that we've increased since then is pretty fantastic. Right? Like over the last fifteen, twenty years, we have made a lot of progress.
Speaker 1:Sure. Is there things that hoteliers could be doing? Is there more room? Yes. There's always more room for them to innovate and utilize more solutions.
Speaker 1:But I actually take a pretty positive view in terms of what hoteliers have done over the last kind of twenty, thirty, forty years. I think generally there tends to be this mindset that like, oh, hoteliers are so behind when it's up to technology. And so I don't disagree. There's things for hoteliers to do. But at the same time, I think it's not it's it's challenging to operate a hotel, to operate a portfolio of hotels.
Speaker 1:And I think hoteliers have done a good job. They've made a lot of progress. The industry's made a lot of progress towards embracing more and more technology to solve some of their pain points. And so I take a little bit more of a kind of an optimist view on that, I think, which maybe is a little bit contrarian that like, I give them credit. I think hoteliers have done a good job and there's still room for them to go, but they've done a good job in terms of embracing technology over the last few decades.
Speaker 2:Absolutely. Well, Harman, thanks so much for joining us on the show today. This is an awesome conversation. I know hoteliers will learn a ton from your guys' journey, how the product has evolved, and your views on the market. So thanks again for coming on.
Speaker 1:Fantastic. Thanks for having me, Jordan. Great to catch up with you.
Speaker 2:That's all for today's episode. Thanks for listening to Hotel Tech Insider produced by hoteltechreport.com. Our goal with this podcast is to show you how the best in the business are leveraging technology to grow their properties and outperform the concept by using innovative digital tools and strategies. I encourage all of our listeners to go try at least one of these strategies or tools that you learned from today's episode. Successful digital transformation is all about consistent small experiments over a long period of time, so don't wait until tomorrow to try something new.
Speaker 2:Do you know a hotelier who would be great to feature on this show, or do you think that your story would bring a lot of value to our audience? Reach out to me directly on LinkedIn by searching for Jordan Hollander. For more episodes like this, follow Hotel Tech Insider on all major streaming platforms like Spotify and Apple Music.