Cabana, the Seattle-based startup that rode the pandemic-fueled “vanlife” travel craze to more than $16 million in funding, shut down at the end of 2023 as economic and manufacturing conditions stalled the company’s ability to raise more funding and scale.
Cabana was seeking a buyer in the fall when it ceased operations, and founder and CEO Scott Kubly told GeekWire on Monday that the company is now in the ABC process, or “assignment for the benefit of creditors.” He’s no longer involved and had no details on whether a buyer might still emerge.
Kubly, the former Seattle Department of Transportation head who founded Cabana in 2019, blamed a number of macroeconomic events that ultimately led to Cabana’s demise. For a company that sought to build out a growing fleet of camper vans, those challenges included a shortage of semiconductors in the automotive industry impacting the supply chain; labor shortages; double-digit inflation on credit financing rates; and a contracted venture capital market.
Cabana is one of several VC-backed tech startups to shut down in recent months and some experts say more closures could be on the way.
The startup let campers rent custom-built cargo vans designed for travel and Instagram-worthy photo ops for roughly $200 a night. The Ford Transit vans included beds, storage, bathrooms, and internet. Customers rented the vans via the Cabana app, which also allowed customers to lock and unlock the vehicles.
After starting in Seattle, Cabana grew its fleet of vans and operations to San Francisco, Los Angeles, Austin and Minneapolis. It also started offering trip planning services.
As recently as Oct. 3, Cabana was posting on X about the expansion of its Seattle hub, with the addition of a van pickup location in Kirkland, Wash. And three months ago on LinkedIn, the company was looking for interested entrepreneurs to become Cabana Platform Partners in San Diego; Bozeman, Mont.; Sacramento, Calif.; Portland, Ore.; Boise, Idaho; Salt Lake City, Las Vegas, Phoenix, Denver, and Albuquerque, N.M.
“When I started Cabana, the premise was to build a mobile kind of hotel room that you could put anywhere,” Kubly said. “It looks like vanlife, but the vision was to do something much bigger, and to have broader market appeal.”
The company took off at a time when traditional travel — airlines, hotels, etc. — were taking a financial hit due to the onset of the COVID-19 pandemic. Sales of recreational vehicles spiked as travelers opted for road trips over confined spaces. But the bubble burst last summer as interest rates and gas prices contributed to a 49% decline in RV shipments year over year.
Kubly said revenue was roughly $1.7 million in 2022 and the company was on pace to hit $2.1 million in 2023. And Cabana had shifted to a more cost-effective model similar to Amazon’s Delivery Service Partners program where entrepreneurial “hosts” ran the fleets in various markets.
But being unable to scale the number of vehicles made for an unattractive pitch to potential investors. And revenue wouldn’t grow fast enough.
“We’ve got great product market fit, we’ve got customers chomping at the bit to rent, our per-unit numbers are up, we’ve gone asset-light … but our top line is flat,” Kubly said. “That’s just not a good fundraising story, particularly in a challenging climate.
“That is the challenge of a business that has a physical product,” he added. “It can only be used so many times. It can only be used by one person at a time.”
Asked whether there is a viable market for another such business to come along and make things work, Kubly said it probably depends on the day you ask him. The model would mainly require a more robust ecosystem of manufacturers to build out the hundreds or thousands of vehicles per year needed to get to desired scale.
Kubly said most of Cabana’s vans have been taken back by lien holders. He expects that most will be auctioned directly to Ford dealers and some may wind up on auction sites. Any travelers interested in trying to track one down might have to work through a Ford dealer.
Cabana raised a total of $16.5 million, including a $3.5 million seed round in 2020, a $10 million Series A round in 2021, and $3 million in December 2022. Past investors included included Craft Ventures, Goldcrest Capital, Nordic Eye, and entrepreneur Jason Calacanis.
At its peak the startup employed about 35 people and when it shut down last month it was down to 15 or so.
In a post on LinkedIn last week, Kubly wrote about the challenges and joys that he got out of running and growing his own startup. He said at its peak Cabana was at over 70 vans in five markets, and served more than 4,000 guests across more than 20,000 nights.
On Monday, he told GeekWire that he was taking time off right now, trying to figure out what to do next.
“I had a really positive experience,” Kubly said. “I learned a ton. I had good supportive investors. Sometimes it just doesn’t work. Sometimes you can try your very hardest and you can do everything that you know how to do, and it still just doesn’t pan out.”
