Travelocity Acquires TravelGuru
We have learnt from a very credible source that Travelocity has acquired Travelguru.
Travelguru is funded by Sequoia Capital and Battery Ventures with infused funds of $25 mn ($10mn in the first round by Sequoia, $15mn from Sequoia and Battery Ventures combined).
Travelocity, when they entered the Indian travel space (2007) announced that they were looking for acquisitions and looks like, they finally found one.
In 2008, there were rumours of Travelguru-Expedia cozy relationships, but nothing fructified.
Update: The news is confirmed about Travelocity’s acquisition of Traveguru and the two companies have released an official statement as well.
Some of the recommended read:
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Related posts:
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About the author - Ashish Sinha is a Startup Mentor/Product Strategy Coach, and the founder/chief editor of pluGGd.in.
He has launched/managed couple of products (consumer as well as enterprise) in US and India, and now consults with startups/small businesses on their product/media strategy. He can be reached at: ashish (at) pluGGd.in [+91 98452 06443]
But...
I think there is a lot of scope for consolidation in this particular market. There is almost no differentiation in terms of the product (Cleartrip is cool while travelguru is clunky – but wth if I save Rs. 100 in the process) and cut-throat price competition has lowered the margins.
Consolidation by exits and cooperation seems to be the only way forward. Innovation is also not a key aspect as everyone can copy you as soon as your first page is out.
Any idea on what is the size of the deal? Would be interesting to know what was the basis of valuations involved. And yes, hope this was not a distress sale!
Great to see this consolidation happening.
http://www.vccircle.com/500/news/travelguru-valued-at-12-million
I think Sequoia screwed TG. I have heard that they went back on promises they made and were rather distrustful in their dealings with both the entrepreneur and with angel investors.
I would say that its not the first time such a thing has been heard about Sequoia India, entrepreneurs need to be careful when dealing with these folks. They are not the same as the ones in US.
Well..it wasnt valued @ $12mn (that report is definitely not correct).
Seems TravelGuru’s investment in Hotels (read Desiya and their own drive to do better in hotels) paid off.
For a lot of time, they did not have any serious competitor in the hotel space and they were able to grow their portfolio of hotels at a fast pace.
Would be interesting to see which way the TG management heads now
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