AI platform targets Cyprus hotels to boost guest revenue

Cyprus-based entrepreneur Yannik Schmidt-Grimm, founder of dreamfactory Hospitality and guest automation platform Foyera, has outlined how building from Paphos shaped his company’s strategy, scaling approach and technological focus, as the group expands across Europe.

Speaking to the Cyprus Mail, the ambitious founder said that relocating to Paphos provided a rare operating environment that allowed him to focus on execution rather than external pressures.

“Paphos gave me something most startup environments don’t, clarity,” he said.

“No distractions, no investor pressure, no networking noise, you just build,” he added.

He explained that Cyprus’ legal and tax framework, combined with EU membership, offered a stable base for operating across multiple European markets.

“The legal framework is solid, the tax environment is serious, and EU membership means every contract operates on familiar ground,” he said.

“For someone building across Europe, that stability matters more than being in a flashy capital,” he added.

Schmidt-Grimm founded the company in 2021 with around €5,000 in personal capital and no external investors, a decision that continues to shape its growth model.

“We never optimised for a funding round, we optimised for cash flow,” he said.

He explained that each property in the group’s portfolio is required to sustain itself financially and contribute to further expansion.

“Every property had to carry its own weight and fund the next one,” he said.

The group operates a hybrid model combining owned and leased assets, with growth financed through operational revenue and real estate lending rather than venture capital.

“We used real estate financing instead of venture capital to buy some of the properties we operate, which meant we kept full control,” he said.

“It’s slower, there’s more friction, but what you build tends to last,” he added.

The company now manages more than 350 units across Vienna and Krakow, spanning hostels, serviced apartments and co-living spaces, while exploring expansion into Lisbon and Athens.

Alongside its hospitality operations, Schmidt-Grimm developed Foyera, an AI-powered platform designed to automate guest communication for hotels and short-term rental operators.

Originally built for internal use, the platform is now being commercialised across Europe, with an initial focus on Cyprus.

Schmidt-Grimm said Cyprus has demonstrated resilience as a tourism destination, particularly when compared with other European cities.

“Cyprus punches above its weight,” he said.

He pointed out that Vienna remains heavily reliant on conference tourism, which took years to recover after the pandemic, while Krakow is more sensitive to pricing pressures.

“Cyprus has something both lack, year-round sunshine and a growing reputation as a premium Mediterranean destination,” he said.

“The challenge is converting that advantage into higher revenue per guest, which is exactly where technology helps,” he added.

He also highlighted a broader shift in tourism demand, with travellers increasingly prioritising authenticity and sustainability.

“It’s a structural shift, not a trend,” he said.

“The last-minute package guest is being replaced by someone who researches for months and spends more,” he added.

While Cyprus benefits from its natural and cultural assets, Schmidt-Grimm said gaps remain in how these are translated into visitor experiences.

“Cyprus has incredible raw material, the landscape, the food, the culture, the history,” he said.

“But you still see too many neglected plots and properties, which is a shame,” he added.

“The question is whether the hospitality infrastructure can match what this new guest expects,” he continued.

“That means investing in quality, design, and technology,” he said.

The rise of short-term rental platforms is also reshaping the competitive landscape, pushing hotels to differentiate beyond pricing.

“It’s forcing hotels to compete on experience rather than price, which is healthy,” he said.

He added that the short-term rental segment presents a significant opportunity for automation tools like Foyera.

“Individual vacation rental owners have no staff and desperately need automation,” he said.

At the same time, he pointed to regulatory challenges, particularly the need for greater professionalisation among property owners.

“The biggest challenge is professionalisation at scale,” he said.

He noted that Cyprus offers a relatively accessible licensing framework compared to cities such as Barcelona and Amsterdam, but warned that expectations are rising.

“Owners who treat it as a side income will struggle,” he said.

“Those who run it like a proper hospitality business will do very well,” he added.

Schmidt-Grimm also addressed concerns around artificial intelligence replacing human roles in hospitality, arguing that its primary function is to fill operational gaps.

“AI doesn’t replace hospitality,” he said.

“It fills the gaps that were already there and creates revenue opportunities that nobody was capturing before,” he added.

He explained that for smaller operators managing a handful of properties, automation can fully handle guest communication across languages and time zones.

“For them, Foyera takes over the entire guest journey, check-in, instructions, questions, everything,” he said.

“It’s not replacing an employee, there was no employee to begin with,” he added.

For larger hotels, the technology serves to enhance service delivery rather than replace staff.

“The guest is lying by the pool and orders room service through their phone via the chat,” he said.

“The front desk staff are still there, still doing what they do best and having time to take care of the guests,” he added.

He said the system can also recommend and book restaurants, improving both guest experience and on-site spending.

“The guest’s experience becomes more seamless, and the property earns more from every stay,” he said.

Looking ahead, Schmidt-Grimm stressed that AI-driven communication can directly influence profitability for Cypriot hospitality operators.

“Great communication drives great reviews and reviews directly drive pricing power,” he said.

“A guest who gets instant, accurate, multilingual responses leaves a better review,” he added.

“Better reviews mean higher rates,” he continued.

He also pointed to current geopolitical conditions affecting tourism flows, increasing the importance of maximising revenue per visitor.

“With fewer tourists due to the geopolitical situation, Cypriot hospitality operators need to maximise revenue per guest,” he said.

“Foyera handles the communication workload of a full-time staff member at a fraction of the cost, nudges the right upsells at the right moment, and helps operators earn more from every booking, without adding staff,” he added.

The founder was recently named to the Forbes 30 Under 30 Europe Class of 2026, recognition he described as secondary to the company’s long-term ambitions.

“We are building this from a small office in Paphos, but for a European market,” he said.

“With Foyera, the next step is to bring that back to the island,” he concluded.