After snaring $1.2 million in new financing, Snag-A-Slip is poised to take a big step toward its goal of becoming the Priceline of boat slip booking.
The Baltimore-based company plans to use the new funding to overhaul its online and mobile application, add 30 employees to its staff of 45, and add hundreds more marinas to its network. It hopes to offer bookings for at least 550 marinas by the end of boat season.
The company also brought on a new chief operating officer to spearhead a larger fundraising round later this year.
"We have lots of things we want to do, that boaters want us to do and marinas would like us to do," said Dan Cowens, Snag-A-Slip's founder and CEO. "This round is allowing us to be able to continue with development."
Marinas have been slow to adopt the so-called aggregation booking model that has long been popular among hotels, airlines and restaurants, through companies such as Hotels.com, Travelocity and OpenTable.
Cowens estimated that the global market for marina slip reservation is worth about $4 billion. While other firms are vying in the space, it's a big enough opportunity for several businesses, he said.
"To see a $4 billion industry with no dominant player was clearly a blue ocean strategy for us," Cowens said.
Snag-A-Slip is part of a technological transformation in recreational boating, as businesses try lure more millennials to replace an aging generation of boaters.
Boat makers are tricking out their new models with high-tech features to catch young boaters' attention. For those with thinner wallets, boat clubs that allow members to split the cost of a boat, and websites that let people rent their boat when not in use, similar to Airbnb's room rentals, aim to make boating more accessible.
"The baby boomers have been driving the industry for several decades, but as we look ahead, the millennial generation is bigger, and it's going to be the millennial generation that drives products," said Thomas Dammrich, president of the National Marine Manufacturers Association. "Every industry, including the boating industry, is looking to understand what they need to do to get a share of the millennial spending."
Slip booking services like Snag-A-Slip's tap into the younger generation's desire for convenience and ease with technology, by making it possible to search for available slips in an area and reserve one on the spot.
Snag-A-Slip works with 350 marinas between Canada and the Caribbean to list available slips. Through the company's website and mobile app, boaters can search for slips that fit their needs for length, water depth and price, and book through the program.
The app is free for boaters to use and for marinas to list slips. Snag-A-Slip charges a fee to marinas when someone makes a reservation through the platform. Snag-A-Slip declined to disclose revenue but said it has about 80,000 users.
The company was founded in 2015 and is part of Baltimore-based Oasis Group Holdings, which also operates a marina management firm, Oasis Marinas. Cowens is also CEO and founder of Oasis.
Snag-A-Slip's service is an alternative to scouring the Internet for available slips then calling each marina for availability and rates.
Trying to find a slip on the fly, once on the water, can be even more tedious, said Avi Rubin, an avid boater and among Snag-A-Slip's latest investors.
Rubin, a Baltimore-based angel investor who has four boats, said Snag-A-Slip appealed to him because he knows from experience that there's a market among boaters for the technology.
"I think that when somebody solves a really big problem with technology that other people aren't addressing, it gives them an edge," Rubin said. "The proposition for Snag-A-Slip as a business is big."
He said he thinks Snag-A-Slip should be able to scale up easily because it is a software-as-a-service business, which means its growth isn't limited by how quickly it churns out copies of a new product.
Rubin was among those who purchased some of the $1.2 million in convertible notes Snag-A-Slip sold recently. His investment will convert to an equity share of the company during its Series A financing round.
A computer science professor at the Johns Hopkins University and an entrepreneur, Rubin will also work with Snag-A-Slip to update its technology platform.
"I don't want to just put in my money and not hear from them until they get bought," Rubin said of his investment strategy. "I want to invest in companies that can get me involved in things I'm interested in."
The company built its booking service using a generic template and now wants to overhaul it to fully customize features for Snag-A-Slip and its client marinas. Cowens hopes to complete the work by Memorial Day weekend, the unofficial start of boating season.
"It allows us much more flexibility to develop continued enhancements that the boaters or marinas are asking for," Cowens said.
More custom features will help Snag-A-Slip attract more marinas, he said. The company wants to increase the number of marinas listing slips through its platform to at least 550, up from 350, by the end of boating season.
As Snag-A-Slip aims to scoop up more marinas and boaters, it is competing for market share in an increasingly crowded field of like-minded technology companies.
SlipFinder in New York and Dockwa in Newport, R.I., are among the companies that see a business opportunity in connecting boaters and marinas.
In January, Dockwa acquired Marinas.com, an online directory of marinas, to expand its reach to boaters and marinas, said Mike Melillo, its CEO and co-founder.
Dockwa hopes to drive more users to its slip booking website by linking to it from Marinas.com, which does not offer its own reservations feature, he said.
"We are excited about the potential to leverage that domain and brand the traffic and funnel it to our partners," Melillo said.
Marinas that list slips through Dockwa must install the company's reservation management platform, so when a boater makes a reservation through the platform it is processed directly by the marina, not by Dockwa.
Not all 15,000 marinas listed on Marinas.com will be available for slip booking through Dockwa, but owning the website gives Dockwa access to a massive network of potential clients, Melillo said.
Cowens said he isn't worried about competition.
He's already preparing for the next round of funding by bringing on a new chief operating officer steeped in fundraising experience. Jen Leroux most recently worked as chief financial officer at Baltimore cyber security startup ZeroFox, where she helped raise more than $37 million.
"The opportunity is large enough that there can be multiple players operating in the space," Cowens said. "It's an enormous opportunity — we wouldn't be here if it wasn't."