Longtime hospitality executives Burt and Alex Cabañas didn't set out to start an investment fund — the father-and-son pair just thought they could be more strategic in their family-office investments.
"I was looking at non-hospitality investment we had made as a family outside of our industry, and I said to my father, 'We've got a lot of dumb money out there in places where we can't help. We can't make a phone call. We don't know the industry. We certainly don't know what the concerns are or where innovation is needed,'" Alex Cabañas said, in an exclusive interview with CoStar News about the new venture.
The Cabañas family made a pivot, and over a year later, the two hoteliers have launched a collaborative $30 million investment fund with Astound Ventures. The fund's investments will benefit the Cabañas' core businesses, Pyramid Global Hospitality and Convene Hospitality Group.
Burt Cabañas, who is the founder and chairman of global hospitality company Benchmark and Pyramid co-chairman, is Astound's chairman, while Alex, who is also executive chairman of hotel management company Pyramid and a board member of meetings and events-focused Convene, will serve as CEO. The group's third founding partner is Chief Financial Officer Kirk Jones, who previously held that role at Benchmark Hospitality and Capella Hotels.
Starting with influence
After deciding to realign their investment portfolio to hospitality, Cabañas said he started looking into what areas of the industry needed innovation — and that meant tapping into and growing a network and ecosystem of industry players.
"The family conversation turned into a thematic industry conversation of why don't we collectively (as an) industry invest in innovation that can solve our problems," he said.
After 60 or 70 conversations, Cabañas sat down to write out some of his early observations and introduce his connections to Astound Ventures. He said he sent that first email on Sept. 19, 2025, and has sent one every Friday since, creating an engaged ecosystem of 300 collaborators — and potential investors.
"Early intentions were never not to necessarily raise a fund. Now that's in our strategy a year later," he said. "It's just amazing, ... the community that we built over the course of the year, one phone call at a time."
Cabañas said he resisted the idea of starting a fund initially, wanting to better understand the industry's problems and potential solutions first. And, more importantly, he said he wanted to raise influence first and avoid creating a stereotypical venture fund.
"I'm looking for small dollars and huge impact. I'm looking for workhorses, not unicorns," he said. "I'm not interested in building, nor do I want to fund, a model that is much like typical VC, where you're just looking for the one breakout billionaire unicorn star. Our industry needs middle-sized, small-sized and large-sized solutions to truly drive adoption."
The money raised in the fund will support Cabañas' mission, and the ecosystem he's creating will exert its own influence on the companies Astound invests in — they will be the ones opening doors and launching the products or services in hotels. And, while the Astound team has a combined 60 years of hospitality experience and large network already, Cabañas said this new network includes experts from other real estate assets and adjacent industries.
"There's a lot of opportunity there as well to learn from other classes of real estate, so as I'm building the network, I am including people in office and multifamily and health care because, in many ways, we're all suffering from labor supply, energy management, health care costs, the cost of our employees," he said.
And for the hoteliers involved, the change has to come from inside the industry.
"If money would have solved our problems, we would have solved them already, right? The level of influence and engagement of this community is what's going to matter," he said. "Our ability to adapt, change management, innovation, change the way we do things — that is what's going to drive the real benefit of innovation."
The investment thesis
Astound Ventures already has 10 companies in its portfolio, and Cabañas said the fund is targeting another five to 10 more to write checks of $1 million to $3 million with an option to follow on invest later.
For Astound, the north star for investments is the question: Does the company provide a product or a service that increases net unit margin for hoteliers? To Cabañas, an industry-wide focus on NUM as a metric and growing margins in general can be a rising tide that lifts all boats.
"If we all focus on net unit margin, that is good for the industry. It's good for everybody. It's good for the person that owns the real estate, that manages the real estate, to the line-level employee, to the guy who makes desks and chairs," he said. "If margin continues to improve, more capital will invest in our space. There will be more growth, more opportunity, a bigger pie for everybody."
Astound's current portfolio includes a wide range of businesses, from a paper goods company to a tech startup innovating connected travel.
"I don't care if it's refillable tissue paper or mobile point of sale," Cabañas said. "As long as it changes a workflow, improves an experience for an employee or guest, or just drives margin in a better way than what we're currently using it. It all comes back down to that."
Astound's first investment was in Fox Fold Products Inc., a sustainable paper goods company with the goal of reducing facial and toilet tissue waste in hotels. Housekeepers using traditional products might have thrown out half-used toilet paper rolls and tissue boxes when changing a room over, but the Fox Fold products are based around refillable, bamboo-based products.
On the other end of the spectrum within the portfolio is Otonoma, which is creating a technology to digitize and interconnect the travel experience. Much like the shipping industry knows where a package is at every step of its journey, Otonoma's technology will enable hoteliers to know when their guests will be arriving and not just have to rely on the 3 p.m. check-in model.
"You can imagine the slack in the system that goes away, and frankly, the improvement of the employee experience of turning a hotel just by having that one piece of information," Cabañas said. "These guys are building the technology that makes that possible."
The third company Cabañas mentioned is a mobile point-of-sales technology company called Beachy. The tech allows staff to instantly input food-and-drink orders for guests from remote resort locations, such as a beach or a golf course, improving operations and delivery time for guests.
Beachy's solution seems obvious, Cabañas said, but the company had a tough time finding the right people to pitch its tech to until its connection with Astound.
"I call it the David and Goliath problem of our industry — we're so big and so massive that sometimes the small, incredibly great innovative idea takes so long for people to see it and absorb it," he said.
The hoteliers who invest in Astound's fund get first access to these companies' products and services, Cabañas said, and that includes the Cabañas' core businesses, Pyramid Global Hospitality and Convene Hospitality Group, which have already implemented some of the portfolio companies' products and services.
Beachy, Fox Fold, Otonoma and the rest of Astound's portfolio companies have already outperformed his initial expectations, Cabañas said.
"That, to me, is proof positive that the the system's working right," he said, "not just the money, but the system of creating a market, creating access, helping the business adopt, align, shift, network, scale — all the things that go in venture investing — the the network is the difference."