A closer look at AAHOA and M3’s strategic partnership
By Elsbeth Russell
Looking back at innovations throughout history, some are simple – like the wheel – and some are complex – like DNA testing and sequencing. What successful innovations have typically had in common, though, is the fact that they occurred at the intersection of an unmet need, a compelling solution, and a business model that can create value and drive growth.
From contactless payments to keyless entry systems and chatbots, the hospitality industry is no stranger to innovation. In recent years, it’s seen revolutionary changes in everything from customer service to back-office operations. One of the most notable innovations, though, is financial management. Accounting systems are becoming smarter, more efficient, and highly adaptable to the needs of the modern hotelier.
An Innovation Born from Understanding an Unmet Need
This innovation was front and center in August 2024 when M3, a leader in innovative accounting software for the hospitality industry, announced investments from Blackstone Growth and AAHOA. The investment was designed to accelerate the company’s growth by enhancing new product expansion and supporting the adoption of M3’s software, which enables hotel operators to run more efficiently and effectively. At the heart of the investment, though, lies the understanding that for true innovation you need a deep understanding of the market you serve.
“M3 understands what we need as hotel owners, and they’re listening,” Kamalesh (KP) Patel, Vice Chairman of AAHOA, said of the partnership. “We commend M3 for coming to the table and saying, ‘We have a product here. How can we make it better? What do today’s hotel owners actually need?’ It’s not a product saying, ‘Here’s our product, use it.’ They’re saying, ‘Here’s our product. What do you need and how can we make it better for today’s hotel?’”
The Origins of M3: Built by Hoteliers, for Hoteliers
To truly understand the significance of M3’s partnership with AAHOA, it’s important to appreciate the company’s roots. Casi Johnson, President at M3, shared the story of how the company came to be. “M3 was born out of a need from a third-generation hotelier, John McKibbon,” Johnson said. “His family’s hotel group needed a way to keep clean, reliable records specific to the hospitality industry – something that was not readily available at the time.” In fact, the original version of M3’s accounting solution was created using floppy disks.
“It wasn’t long after that the internet emerged, and we quickly pivoted to offering the software via a private cloud, which was groundbreaking for its time,” Johnson explained. Over the past 25 years, M3 has evolved into a leading provider of enterprise-level accounting solutions, with a strong emphasis on addressing the specific needs of the hospitality industry. The company’s growing suite of products and services is designed to provide hoteliers with real-time financial insights, making it easier for them to manage everything from accounting and labor management to analytics.
As Parag Doshi, CTO at M3 explained, M3’s goal has always been to make financial management easier and more accurate for hoteliers. “We wanted to build something that not only tells you what happened but also helps you understand why it happened and guides you to where you need to go,” Johnson said. “Technology is moving toward not just reporting past performance, but predicting future outcomes and suggesting the next steps.”
The Role of AAHOA in the Partnership
The partnership between M3 and AA-HOA is a strategic move to provide more affordable, intuitive accounting solutions for small to mid-sized hoteliers, especially those in the economy and limited service sectors. AAHOA, which represents over 60% of U.S. hotel properties, plays a crucial role in connecting M3 with its vast network of hotel owners.
“AAHOA has always been committed to helping our members grow and succeed. When the opportunity to partner with M3 came about, it was a no-brainer for us,” Patel said. “M3 is one of the most respected companies in the industry, and their understanding of the specific needs of hotel owners is unmatched.”
Patel also highlighted the fact that M3’s platform is designed to scale with a hotelier’s business as it grows. “Whether a hotelier operates one property or 30, M3 has a solution that can grow with them. This flexibility is key to ensuring that hoteliers don’t have to switch platforms as they expand,” he said.
The Power of Innovation in Hospitality Accounting
Innovation is not just a buzzword for M3 – it is a central feature of the company’s offerings. Over the past few years, M3 has innovated accounting software consistently, helping hoteliers automate routine tasks, analyze data more effectively, and make smarter business decisions. As M3’s Chief of Sales and Marketing Scott Watson explained, M3 helps the industry move from simply tracking what has happened to actively predicting what will happen. While some are quick to deploy anything in a vacuum, M3 is always looking to innovate at the right pace, responsibly, to ensure the most valuable of needs are addressed.
For instance, M3’s tools are capable of identifying trends in labor costs, energy consumption, and other key performance indicators. The software uses this data to forecast future expenses, making it easier for hotel managers to plan ahead and adjust their budgets accordingly. This proactive approach allows hoteliers to stay one step ahead, particularly in a climate where operating costs are subject to rapid fluctuations.
Meeting the Needs of Small and Mid-Sized Hoteliers
One of the driving forces behind the M3-AAHOA partnership is a shared commitment to serving small and mid-sized hoteliers, many of whom operate limited-service properties or smaller portfolios. As Watson noted, these hoteliers of-ten face a unique set of challenges when it comes to financial management. “There hasn’t been a cost-effective, tailored solution for this segment of the market. Large enterprise-level systems were often too expensive or too complex for more scaled-down operations,” he said.
To address this gap, M3 created the CoreSelect™ solution, a streamlined version of its accounting platform designed specifically for smaller hotel portfolios. Patel explained that this offering is a perfect fi t for AAHOA’s Membership, which consists largely of owners with smaller hotel portfolios. “M3’s CoreSelect™ solution is ideal for hotel owners with one to fi ve properties who need an affordable, easy-to-use system that can scale as their businesses grow,” he said. Moreover, Patel emphasized that the partnership with M3 is focused on enhancing the profitability of AAHOA Members.
“Ultimately, the goal is to help hotel owners increase their bottom line. The partnership with M3 will help our members improve their ROI and NOI by providing them with a more efficient, data driven way to manage their finances,” he said.
The Future of Innovation in Hospitality
Looking ahead, both AAHOA and M3 are excited about the potential for continued transformation in the hospitality industry. “I’m proud of M3’s continued innovation that includes partnerships like AA-HOA,” said Johnson. “With the depth of our knowledge and expertise, I have no doubt that M3 will continue to elevate hospitality financial performance through state-of-the-art technology and unmatched service.”
At AAHOA, Patel stressed the importance of embracing innovations and staying ahead of technological trends. “Our goal is not just to solve today’s problems but to anticipate the challenges that hoteliers will face in the next fi ve to 10 years. By working closely with AAHOA and its members, we are able to ensure that our technology evolves to meet the future needs of the hospitality industry,” he said.
By combining AAHOA’s vast network of hotel owners with M3’s accounting platform, the two organizations are setting the stage for a more efficient, profitable future for hoteliers. With a focus on scalability, innovation, and real-time data, this partnership will help hoteliers make smarter financial decisions and stay ahead of industry trends.
Hoteliers can not only streamline their operations but also position themselves for long-term success in an ever-evolving market.
Note: “M3,” “CoreSelect,” and “Built by Hoteliers, for Hoteliers” are trademarks of M3, LLC.
Image: QuickDesign24/stock.adobe.com
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