Corporate business-travel platform TripActions just announced $250 million in Series D funding from venture firms Andreessen Horowitz, Zeev Ventures, Lightspeed Venture Partners, and Group 11, burnishing its unicorn status and lifting its valuation to $4 billion. What’s most important, it’s in a market segment out of the reach of the tentacles of Google Trips.
Some of the latest cash infusion will go toward advancing the 4-year-old Silicon Valley company’s technology that manages more than $1.1 billion in annual travel budgets for employees at 2,000 companies that include Lyft Inc. LYFT, -1.67% WeWork, and SurveyMonkey SVMK, -2.28% In all, TripActions has raised $480 million in four rounds.
TripActions thinks it’s found a sweet spot in the estimated $1.5 trillion global market for corporate travel, company CEO and co-founder Ariel Cohen told MarketWatch in a phone interview. It’s using sophisticated search analysis and machine learning, among other things, to enrich the experience, such as rebooking a flight automatically upon the cancellation of another, and suggesting favorite hotels in particular cities based on an individual’s tastes.
In pursuing the corporate side of travel rather than consumers, TripActions is addressing an antiquated market in need of a technology makeover while avoiding the Google behemoth.
The Alphabet Inc. division’s GOOGL, -0.67% GOOG, -0.60% move in May to combine its travel-related products—including the Google Trips mobile app, Google Flights, and Google hotels search—into one landing page called Trips is a “troublesome development” for those in the online travel business, according to financial analysts. Wedbush Securities’ James Hardiman predicted choppy waters for metasearch engine companies Trivago TRVG, +1.34% TripAdvisor Inc. TRIP, -1.03% Booking Holdings Inc. BKNG, -0.83% and Expedia Group Inc. EXPE, -1.61% in a note to clients on May 20.
The one-stop Trips site is dangerous on several levels, starting with an option that lets consumers go straight to the Google Hotel Ads system and bypass metasearch engines. This hurts TripAdvisor and Trivago, who have invested in Google Hotel Ads to gain traffic.
“The latest innovations by Google in the travel sector signal that the Google threat is becoming harder and harder to ignore,” Hardiman writes. “We believe, with over 1.5B (billion) active people already using Gmail, Google has a distinct advantage over its competitors in providing these relevant and helpful tools for its users.”
Google has taken several steps over the past few years to increase its presence in the online travel space. In early March, it rolled out a dedicated hotel booking website. (Previously, travelers had to start with a hotel-related query in Google search before reaching its Hotels search widget). In May, Google rolled out vacation rentals to its hotel search engine.
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