HotelTonight Raises $3.25 Million for Last Minute Hotel-Booking App

San Francisco-based HotelTonight, which has an iPhone application that allows you to book last-minute hotel deals on the same day you are looking, has raised $3.25 million in a first round of funding.

I wrote about the company last month, noting that a number of travel applications have launched recently to take advantage of booking rooms or flights while on the go.

HotelTonight’s round was led by Battery Ventures with participation from Accel Partners and First Round Capital. Additional investors include travel industry veterans Rich Barton and Erik Blachford, both formerly of Expedia, Brad Gerstner, the founder and CEO of Altimeter Capital, and former Farecast CEO Hugh Crean.

Since launching in January, HotelTonight’s app has been downloaded more than 300,000 times.

The company said it will use the capital to expand the product to new mobile platforms, add new features, support marketing campaigns and expand into new markets.

The HotelTonight app is free and currently available on the iPhone. New customers receive a $25 credit toward their first booking. The app provides last minute hotel rooms at discounted prices in New York, San Francisco, Los Angeles, Chicago, Boston, Washington, D.C., Miami, Seattle, Dallas, Philadelphia, Atlanta, and Denver.

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— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik