Online Travel: a Deep Dive

Online Travel: a Deep Dive
Europe and beyond
June 2016
Table of contents
1. Introduction
2. Macro view
3. Strategic landscape
4. Funding & valuation data
2
About this report
Who is Dealroom.co
This report
■
Dealroom is Europe’s leading online resource for rich
data and analytics on private tech companies
■
Natural language processing and algorithms are used
to capture real-time insights on 500K companies
■
Data is verified and curated by an internal team of
analyst and by our community of 10K+ founders, VCs,
accelerators, journalists
■
Founded in 2013 by a team with backgrounds in
investment banking, data science and IT
10,000+ contributors
(founders, VCs, …)
■
This report combines algorithmic and funding data
from Dealroom with industry research and insider
interviews, to provide a 360° view on the online
travel space
■
The scope is global, but with European emphasis
■
In addition to this presentation, the full report also
consists of an online database with curated lists,
which are references throughout this presentation
■
For more information, also check dealroom.co’s blog
Curation & research
by Dealroom’s team
Big data analytics on
500,000+ companies
3
Authors and contributors
Editors
Yoram Wijngaarde
Founder of Dealroom.co
Former tech, media and telecom M&A advisor at Lehman Brothers and NOAH
Advisors
Julien Puls
Content curator
With Dealroom since 2014. Formerly at CMB Capital
Université Jean Moulin, Lyon
Robin Wauters (Founder at Tech.eu)
Advisor / minor shareholder of several tech starups such as Checkthis
(Frontback), Maily.com, Argus Labs (Jini.co), Showpad.com and Oxynade.com.
Former Editor at The Next Web, Vitualization.com and TechCrunch.
Jaime Novoa (Data Analyst at Tech.eu)
Also owner of Novobrief, an English language blog covering the Spanish startup
ecosystem. Previously a writer for StartupXplore, Weblogs and We Are Social.
Contributors
Philipp Brinkmann, (Founder and CEO, Tripsta)
Tripsta is a leading OTA in Greece and operates in 50+
markets. Philipp has also been on the board of several
companies in the travel, e-commerce, and media
industries.
John Erceg (private investor, hotelier, serial entrepreneur)
Founder of Budgetplaces, sold in 2011 to private equity.
MBA from IESE business school, Worldwide Market
Development Manager for HP. From California, lived in
Barcelona since 1994.
RJ Friedlander (Founder & CEO, ReviewPro)
Over 17 years experience in Internet and technology
in Europe, the US and Asia. Led projects that have
generated more than $300 million in revenue. Senior
executive at Grupo Planeta for about 10 years.
Joe Haslam (Chairman & Co-founder, Hot Hotels)
HotHotels offers discount, mobile only rates up to 7
Days in advance of your stay. In 55 Countries & 333
cities in Europe, Africa, Middle East, Asia & the
Americas (Techstars Boston, Summer 2015 class).
Patrick Martin (Partner - LD&A Jupiter Corp Finance)
M&A advisor in media & tech since 1993. Former Head of
Media at Alegro Capital, Co-CEO of 2k Media, and Managing
Partner of Helkon Media.
Jose Luis Martinez (CEO at HundredRooms)
Former Head of Kayak in Spain, and Managing
Director of Spain and Portugal. Former Director for
Spain eDreams ODIGEO. Advisor to Board of
Directors in Minube. In 2008 founded Viamedius.
Avi Meir (Co-founder and CEO at TravelPerk)
Founder of Hotel Ninjas, sold to Priceline in 2014. MBA
from IESE Barcelona. Former Senior Product Owner at
Booking.com and Product Vice President at
budgetplaces.com
Chris Moller (Campanda CEO & founder, Möller Ventures)
Campanda is a booking platform for RVs which raised €5m
series A last year. Chris is also the former CEO and founder
of erento, a marketplace for renting goods and services,
sold in 2011 to Russmedia.
Elliott Pritchard (CMO, Triptease)
Former Chief Marketing Officer at Travel Republic, he
has assumed leading positions at P&O Cruises,
Kuoni, and MarketingNet.
Carlos Rodríguez-Maribona Andrés (COO, Minube)
Beyond his role at the UK based leading travel guide
Minube, Carlos is also an Associate at the investment
division of Axon Partners Group.
Friedrich von Scanzoni (CEO, Burda Asia)
Broad management experience in digital media (13 years),
in start-up, growth and restructuring environments. Former
Managing Director International at HolidayCheck and VP of
VP Corporate Development at Tomorrow Focus.
Axel Schmiegelow (CEO of iTravel)
Serial entrepreneur focused on the web, social
media, and software. itravel is an experience-based
online and mobile tour operator that offers leisure
travelers a platform to fully customize trips.
Naveen Sharma (CMO, Lodgify)
Lodgify enables vacation rental owners and managers
to easily create a website for their properties and
manage their reservations. Former Senior Consultant at
Cloudbridge.
Jan Wegenaar (CEO at Advalley.io)
Direct marketing & travel entrepreneur. Launched voucher
concept, sold to WTA in 2007. Founded Advalley.io in 2011,
a B2B voucher marketplace for merchants and advertisers.
4
Introduction
Online
migration
Market power
New
developments
■
Most travel segments (hotels, tour operators, traditional flights, cars, rails) are still over 60%
dependent on offline and other channels. The exception are low cost airlines, at 90% online
■
However, “offline and other channels” does not necessarily equal “old-fashioned”. It includes
personally individualised travel, using Google, and then booking locally, via email, etc
■
The next frontier in online migration likely involves: customisation, on-demand, and convenience
■
Following a consolidation wave, Priceline and Expedia now have over 60% European market share of
Online Travel Agents (OTAs). That is about 13% of the total online & offline European market
■
Booking.com (Priceline) dominates lucrative hotel distribution, mainly via Google paid search
■
The remaining 40% of the OTA market is fragmented, consisting of regional OTAs and meta-search
■
Meta-search is still on the rise in Europe, both in flights and hotels, surpassing regional OTAs
■
Airlines have maintained direct distribution power, by consolidating and investing in online presence
■
In April ‘15 Booking.com was forced to abandon certain price-parity clauses, allowing hotels to offer
lower prices via smaller OTAs. This also plays into the hands of price comparators (meta-search)
■
Meanwhile, Google is deploying a cost-per-click (CPC) model for hoteliers (Hotel Ads / Hotel Finder).
Trivago (Expedia), too, is experimenting with a direct CPC model for hotels
■
Hotel chains are seeking to regain control, via consolidation (AccorHotels, Marriott), by investing in
startups (Hyatt, Wyndham, AccorHotels), and their own booking platforms (AccorHotels)
■
Travel was originally among the first industries to get digitised, but disruption keeps happening and
online migration still has a lot of ground to cover
5
Core travel segments
Meta-search
Booking
P2P
■
Flight meta-search is benefiting from regional fragmentation of flight OTAs. Skyscanner is also testing a direct distribution model
with airlines, thus becoming a quasi-OTA. An OTA’s take-rate adds up to 5-10%, whereas for Skyscanner the CPA is as low as 2-3%
■
Hotel meta-search is also on the rise, as consumers look to compare across all types of accommodations, not just hotels.
Abandonment of price parity means that usefulness of price comparison increased, revealing price differences on single properties
■
New hotel booking platforms face high entry barriers, requiring both inventory and distribution. Plus, Booking.com already
dominates. But there is still is a $58 billion offline hotel opportunity in Europe and hotels keen to reduce Booking.com dependency
■
Other attractive segments include: cruise lines ($40B (2)), trains ($33B), campings ($10B(1)), activities, and business travel ($1.2T ! (3))
■
In flights, the OTA model is crowded and being challenged by the meta-search model and airlines
■
Airbnb created an entirely new category and is leading the space with close to $9B in bookings. Since then, Booking.com already
established a strong position in apartment rentals
■
Other attractive segments include camper vans (Campanda), boats (Sailsquare), and cars (Blablacar)
■
Packaged tours made a comeback via new discount-driven models such as clubs, email, and deep-discounting (Travelbird, others)
■
Traditionally the domain of TUI, Thomas Cook etc, this $55B market is still is 75% offline ($41B). Much anticipation now comes
from highly personalised travel solutions using human and artificial intelligence (Lola, iTravel, HeyJude) and on-demand models
■
More traditional OTAs in Germany have been pursuing consolidation strategies (7Travel, Unister). Several local mid-market online
tour operators seek scale via strategic combinations, exits or private equity sponsored roll-up
■
The hotelier software space has traditionally been crowded due to low entry barriers. Recently however, hoteliers are keen to regain
control over their distribution and thus willing to invest in online presence, guest management, CRM, loyalty
■
Booking.com is rolling out its hotel management software suite (called BookingSuite) and has made acquisitions in this field (Hotel
Ninjas, PriceMatch, Buuteeq). However, some hoteliers are disinclined giving Booking.com more power over their reservations,
creating anopportunity for independent B2B tools
■
The default online travel model has been “search & book”, but there is still a huge underserved “on-demand” consumer market
■
Also, app based personal assistants could soon replace tour operators (powered by human and/or AI)
■
Mobile is so far only 15% of total online volume but expected to grow rapidly
Packaged tours
B2B tools
Apps
6
1.
Market industry interviews.
2. Statisa.
3. PhocusWright.
Identified companies to watch
Seed stage
Meta-search
Booking
P2P
Packaged tours
Early stage
Late stage
Buyout stage
AllTheRooms (all room types)
ComparaBUS (all ride types)
HundredRooms (rooms)
Holidu (vacation rentals)
Tripping (vacation rentals)
Kiwi.com (low cost flights)
Voopter (Brazil flights)
Tiqets (events)
HeyCaptain (boat rental)
Campday (campings)
Loco2 (trains)
TravelPerk (business)
Couverts (dining)
Cruisable (cruises)
Stratajet (private jets)
Musement (guided tours)
Hipcamp (campings)
Campings.com (campings)
Amoma (budget)
Budgetplaces (budget hotels)
Dreamlines (cruises)
GetYourGuide (events)
Atrapalo (events)
Motorhome Republic (motorhomes)
Tripsta (flights)
OneTwoTrip (flights)
HRS (hotels)
Auto Europe (cars)
Hotel Urbano (hotels)
Yestudent (budget)
Handiscover (disabled)
MyTwinPlace (home share)
Click & Boats, Barqo (boats)
Homestay (vacation rentals)
Sailsquare (sailing)
Wimdu (vacation rentals)
9Flats (vacation rentals)
Campanda (camper vans)
Blablacar (ride share)
Gruppal (Turkey)
Hey Jude (personal assistant)
TourRadar (tours)
Travelata (Russia)
Lola Travel (custom)
iTravel (custom)
Festicket (festivals)
Travador (packaged weekends)
Travelbird (email deals)
Evaneos (France)
Emesa (discounts)
Secret Escapes (club)
Inspirato (club)
Viajanet (LatAm)
Holidaycheck (Reviews)
Unister (Germany)
Accor Hotels (Hotels)
Decolar (LatAm)
Advalley (hoteliers)
MaxMind (hotel GDS)
Poshberry (loyalty)
Lodgify, Kigo (vacation rental)
Triptease (site conversion)
Channelrush (hoteliers)
BD4Travel (big data)
Alice (concierge)
Avvio (booking platform)
SilverRail (rail operators)
Eviivo (hoteliers)
Siteminder (hoteliers)
Snapshot (analytics)
Revinate (review analytics)
Reviewpro (review analytics)
TravelClick (hoteliers)
RateTiger (hoteliers)
Touchotel (hotel)
Polarsteps (diary)
Hot Hotels (hotel)
Dayuse (budget hotels)
Byhours (budget hotels)
Ulmon (guide)
TRAFI (journey planner)
HotelCloud (concierge, B2B2C)
HotelTonight (hotels)
CityMapper (journey planner)
More data
available online
more seed stage »
more early stage »
more late stage »
B2B tools
Apps
View underlying data »
https://app.dealroom.co/lists/10049
HomeToGo (rooms)
Skyscanner (flights, CPA)
Momondo (flights, CPC)
7
Table of contents
1. Introduction
2. Macro view
3. Strategic landscape
4. Funding & valuation data
8
Bookings of $1.3 trillion globally
of which over $450 billion online ...
Booking volume by type
Booking volume by geography
9
Source: PhocusWright 2015 estimates and 2010-2015 % CAGR. Eurostat. Dealroom.co analysis. Excludes managed business travel.
Online travel is dominated by
Priceline, Expedia, Airbnb, and Google
$ 68B gross bookings
Booking, Kayak,
OpenTable, Agoda, ...
$ 78B gross bookings
Expedia, Trivago, HomeAway,
Orbitz, Travelocity, Wotif, ...
$ 60B firm value
= 13 x $ 4.6B EBITDA
$ 17B firm value
= 10 x $ 1.7B EBITDA
$ 9B
$ 25B firm value
$12 B
$ 1B firm value
eDreams, Opodo
Govoyages
$5B
$ 625M firm value
= 6.4 x $ 94M EBITDA
10
Source: PhocusWright 2015, adjusted for acquisitions, equity research, Dealroom estimates.
But there is still plenty of room to
grow, via existing and new channels
Global market share
UK, France, Germany
11
Source: PhocusWright 2015, adjusted for acquisitions, equity research, Dealroom estimates. Excludes managed business travel.
Offline still accounts for over 60% of
bookings (except for low cost airlines)
European booking volume by channel
Skyscanner etc.
Via GDS, direct phone, travel agents, ...
$58 billion opportunity for:
- Booking.com and other OTAs
- Hotelier’s direct online channel
- On-demand apps
Booking.com etc.
Lastminute, Unister etc.
Traditionally the domain of TUI, Thomas Cook etc
A $41 billion opportunity for innovative, flexible and
customisable travel solutions
As percentage
Already 90% direct online
12
Source: PhocusWright 2015, adjusted for acquisitions, equity research, Dealroom estimates. Excludes managed business travel.
UK and Germany stand out in size, but
Southern Europe offers more growth
Booking volume
% volume growth
13
Source: PhocusWright 2015, adjusted for acquisitions, equity research, Dealroom estimates. Excludes managed business travel.
Mobile bookings are still nascent
European mobile booking volume
Online
European online booking volume
14
Table of contents
1. Introduction
2. Macro view
3. Strategic landscape
4. Funding & valuation data
15
Expansion of accommodation types
Airbnb’s rise is displacing city residents and even impacting housing market
prices, but so far “only” about 5% of new rooms were added to the total pool.
City
$180B bookings (3)
Rural
$10B (3)
Beach
|
Ski
$180B bookings (3)
Expedia
TUI
Lastminute
Unister
7travel
Booking.com
Hotels
B&B
1 million properties (1)
(= 25 million rooms)
Bookable
Apartments, Rooms, Villas
1.5 million properties (2)
(= circa 2 million rooms)
Airbnb, Homeaway, Wimdu
Hostels
Hostelworld
Campers / Campings (€10B)
Campanda, Motorhome Republic
Cruises
Dreamlines
Meta-search: Trivago, Kayak, Hometogo, HundredRooms, Holidu, ….
Source: Dealroom.co, Euromonitor.
1.
Of which about 250K in Europe.
2.
Of which about 500K in Europe.
3.
Europe: $50B in cities, $50B in beach & ski, $5B in rural. Excludes managed business travel.
16
Booking dominates hotel distribution
chain, mainly via paid search
Hotels
Guests
Hotel
Search
circa
€100
€80
circa
€20
Hotelier Stack:
Direct
MaxMind, Avvio, Triptease, Advalley
Trivago
Kayak
HundredRooms
AllTheRooms
HomeToGo
Holidu
Consumer Stack:
Google search
(and Google Hotel Finder)
Loyalty & CRM
On-Demand Apps:
PMS
(Property Management System)
Booking Engine
Expedia, Airbnb ...
Channel Manager
Reputation management
GDS
HotelBeds
HotelTonight
Touchotel
Dayuse
Polarsteps
Ulmon
TRAFI
Blink Booking (Groupon)
Tour Operators
TUI, Thomas Cook, ...
Source: Dealroom.co
Note:€20 is indicative cost per booking. Booking commission typically ranges from 10-30%.
17
Hotelier distribution stack
Hoteliers of all sizes are keen to regain some control over their distribution,
and are willing to invest in online presence, loyalty, and guest management
Vistors
Hotel Management
Customer Retention
- Reputation management
(ReviewPro, Revinate)
- Loyalty (Advalley)
Integrated PMS, revenue
management and booking:
Eviivo
Direct Online Channels
Buying traffic (cost per click)
- Google Hotel Ads (Hotel Finder)
- Trivago Direct Connect (Expedia)
- Still in somewhat experimental phase
- In theory, hotel could outbid OTAs, if it can
get conversion rates on par
Online presence
- Online suite & booking engine
(Avvio, BookingSuite)
- Conversion optimisation (TripTease)
BookingSuite
Walk in (= on-demand)
Guest management:
Alice (Expedia invested)
Intermediated Channels
HotelCloud (app for guests)
OTAs (agency model):
- Booking.com (15-30% commission)
- TripAdvisor Instant Booking (15%)
- AccorHotels opened its booking platform
to independent hoteliers
- Other OTAs
Analytics dashboard:
Snapshot
Channel Managers
Matching inventory with multiple distributors
TravelClick, RateTiger
Siteminder, Channelrush
Tour operators (merchant model):
- GDS / Bedbanks (Hotelbeds).
- Relationship with agent, not customer
18
Source: Dealroom.co
Global Distribution Systems (GDSs)
still manage 20% of European travel
GDS
HQ
Market cap
Amadeus
Sabre
Travelport
Hotelbeds
Amadeus
Sabre
Abacus (ownership stake)
Apollo Galileo Worldspan
Hotelbeds
Spain
United States
United States
Spain
€18.3B
$7.7B
$1.7B
$1.3B
(April ‘16 acquisition price)
+2%
+6%
-16%
private
12 month share price
performance
Net revenues
2015 and 2016
$3.9B
$4.3B
$3.0B
$3.4B
$2.2B
$2.4B
$1.1B
$1.2B
EV / EBITDA
2016 and 2017
12.5x
11.5x
9.7x
8.6x
6.7x
6.0x
15x
12x
Ownership
Publicly listed
(BC Partners, Cinven sold down
ownershiP)
Publicly listed
(Silver Lake, TPG selling down
ownership)
Publicly listed
(Blackstone sold down most of
ownership)
Cinven, Canada Pension Plan
(acquired from TUI
in April 2016)
19
Source: PhocusWright 2015, Dealroom.co
Industry consolidators
Priceline
Expedia
eDreams
ODIGEO
LastMinute
Group
ProSieben
(via 7Travel)
TUI
Thomas
Cook
TripAdvisor
Airbnb
Ctrip
Recruit
Net revenue (2015)
$9.2B
$6.7B
$517M
$278M
$3.7B
$22B
$11.4B
$1.5B
$900M
$1.7B
$14.5B
Market cap
$63B
$17B
$259M
$169M
$11B
$9B
$1.6B
$10B
n/a
$20B
$19B
12 Month change
+7.8%
+4.6%
-31%
-39%
+2%
-8.6%
-46%
-11.5%
n/a
+139%
-5%
Firm value
$66B
$18B
$625M
$90M
11.5B
$10B
$1.7B
$9.3B
$10 - 21B
$21B
$17B
Market share
Hotel stack
Diversify
Market share
Diversify
Unknown
Increase online
scale
Increase online
scale
Divesting
Buying tour
operators
Adding B2B
classifieds
models
Small
acquisitions
Strategic VC
investments
Strategic VC
investments
Kayak
2012, $1.8B
HomeAway
2015, $3.9B
Opodo
2011, merger
Rumbo
2012, $81M
Etraveli
2015, €235M
Öger Tours
2010, N/A
Kuxun.cn
2009, $12M
Accoleo
2011, N/A
TravelBook.ph
2015, n/a
Booking.com
2005, $135M
Orbitz (incl
eBookers)
2015, $1.6B
eDreams
2011, merger
lastminute.com
2015, $120M
Travelstart
2010, N/A
Hotels4U.com
2008, GBP 21.8
M
holidaylettings.
co.uk
2010, N/A
CrashPadder
2012, N/A
Tuniu
2015, $500M
round
Elegant Resorts
2008, N/A
Oyster
2013, N/A
MyTravel Group
2007, merger
LaFourchette
2014, $140M
Acquisition strategy
Selected Acquisitions
Hotel Ninjas
2014, N/A
Buuteeq
2014, N/A
PriceMatch
2015, N/A
OpenTable
2014, $2.6B
Rentalcars
2010, N/A
Agoda
2007, N/A
Swoodoo
2010, N/A
Trivago
2012, $632M
(62%)
Travelocity
2015, $280M
Govoyages
2011, merger
Jetcost
2013, N/A
Gotogate
2009, N/A
bravofly
(founded)
Seat24
Volagratis
(founded)
SRG Online
Wotif
2014, $658M
Auto Escape
2014, $85M
Hotels.com
2001, N/A
View underlying data »
https://app.dealroom.co/lists/10048
HotelBeds
Group
sold
AsiaRooms.
com
2007, $67.5M
Transat French Unit
2016, $62M
Viator
2014, $200M
Iens.nl
2015, $11M
Dimmi
2015, N/A
CarRentals.
com
2008, N/A
Venere
2008, N/A
LateRooms.
com
2006,
GBP120M
NabeWise
2012, N/A
Localmind
2012,N/A
Fondu
2012, $0.6M
Vamo 2012,
N/A
Yongche
2013, $60M
round
ToursForFun
2014, $100M
Tripping
2014, funding
round
Tujia
2014, $100M
round
TravelBook.ph
2013, joint
venture
eLong
2015, $400M
(38% stake)
Mytour.vn
2012, joint
venture
Travelfusion
2015, $160M
Pegipegi.com
2012, joint
venture
MakeMyTrip
2016, $180M
(27% stake)
More data
available online
Blacklane
2014, $3.3M
round
Qunar
2015, (45%
stake)
Suanya
2015, $16M
20
Fragmented European OTA landscape
Mid-sized online tour operators will likely seek scale via strategic
combinations, exits or private equity sponsored roll-up
More data
available online
View underlying data »
https://app.dealroom.co/lists/10053
21
Table of contents
1. Introduction
2. Macro view
3. Strategic landscape
4. Funding & valuation data
22
Quarterly funding is trending upward,
albeit skewed by a few large rounds
View underlying data »
https://app.dealroom.co/funding-rounds?industries=travel.must
23
Selected recent exits
Date
Target
Acquiror
May-16
Splendia
Voyage Prive
May-16
Hotelbeds Group
Cinven (consortium)
Apr-16
HouseTrip
TripAdvisor
Apr-16
onefinestay
Accor Hotels
Mar-16
Capitaine Train / Captain Train
Feb-16
Transaction
Value
n/a
€1.2B
Selling Investors
Omnes Capital, Alten Capital
TUI
Previously Invested Capital
€4.3M
n/a
Index Ventures, Balderton Capital, Accel
Partners
€54.3M
€148M
PROfounders Capital, Index Ventures,
Canaan Partners , Intel Capital, Accor
Hotels, David Magliano
€73.5M
TheTrainline.com
€165M
Oleg Tscheltzoff, Alven Capital, Index
Ventures, CM-CIC Capital Prive,
TheTrainline.com, Xavier Niel
€9.6M
Kuoni
EQT Private Equity
$1.4B
Veraison Capital AG, Schroders, UBS
Fund Management, Classic Fund
Management, Go Investment Partners
public
Nov-15
Hostelworld.com
IPO
€245M
Hellman & Friedman
Oct-15
Etraveli
ProSiebenSat1 Media AG
€235M
Segulah Advisor AB
n/a
Jan-15
TheTrainline.com
KKR
€450M
Exponent Private Equity
n/a
Mar-14
CarTrawler
BC Partners, Insight Venture
Partners
€440M
ECI Partners, founders
View underlying data »
https://app.dealroom.co/exits?industries=travel.must
n/a
€202.5M
(acquisition)
€50M
(50% stake)
24
The most funded companies
View underlying data »
https://app.dealroom.co/companies?hq_regions=Europe+incl+Israel.must&industries=travel.must&sort=-total_funding
25
The largest rounds
View underlying data »
https://app.dealroom.co/funding-rounds?industries=travel.must
26
The most active funds
View underlying data »
https://app.dealroom.co/markets/industries/travel/top-funds
27
Trading valuation multiples
28
Transaction valuation multiples
More data
available online
View underlying data »
https://app.dealroom.co/exits?industries=travel.must
29
Rich data and analytics
on private tech companies.
https://app.dealroom.co