GetYourGuide’s latest financial movements suggest future acquisitions
Reading between the lines, it looks like the Berlin-based online travel agency is hoping to make a minority acquisition or investment, most likely one that would expand its product portfolio, as with its “original” white-label experiences.
Sean O’Neill, Skift
The pandemic has significantly affected the activity of tour operators and activities. Still, one of the largest online travel agencies to book such experiences has had little problem accessing funds. GetYourGuide, an agency based in Berlin, announced Monday that it had received a loan of 97 million dollars (80 million euros) from a consortium of banks, led by Unicredit.
The credit facility comes just months after GetYourGuide lifted a convertible loan of $ 134 million (€ 114 million) in October.
Why does GetYourGuide need money? After all, its spending plummeted during the crisis, with less need to buy advertising on platforms like Google to attract customers. Labor costs also fell after the company laid off nearly one in six workers in the fall. The company still has financial reserves from raising $ 484 million in venture capital in May 2019 as part of a round led by venture capital giant SoftBank Vision Fund.
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GetYourGuide could use the revolving credit facility for acquisitions or investments, such as more investment in the company’s “original” brand tour or new services to help consumers book eleventh hour experiences. said Nils Chrestin, chief financial officer. For example, it could use some of the money to help tour operators convert their ticketing systems to contactless technology and accept scheduled tickets rather than walk-in tickets.
But given how much money the company has raised, an acquisition seems like something executives are strongly considering.
“The € 80 million is not being raised for a specific acquisition or target investment,” Chrestin said on Monday in response to our questions. “It is put in place so that we have maximum strategic flexibility to engage in these discussions. “
Since 2018, GetYourGuide has been slowly developing white label tours under its own brand, which it calls “originals”. To make this process smoother with more vertical integration, GetYourGuide could consider making a minority or majority investment in a tour operator in a major market.
GetYourGuide may want to fill in the gaps in its inventory, which could include tours and experiences in Asia-Pacific, where it competes with Klook, an online travel agency focused on experiences and attractions, which has lifted $ 200 million in its last round of venture capital funding in January. .
KKday, a Taipei-based travel experiences booking agency, closed $ 75 million in new funding in September and has raised more than $ 97 million to date.
“In the second half of last year, in China, Taiwan, Singapore and Hong Kong, we saw national rebounds of between 70% and 80% of pre-Covid levels”, Eric Gnock Fah, director of the ‘operating and co-founder of Klook, said last month.
Chrestin dismisses skeptics who wonder why GetYourGuide turned to convertible debt and loans for cash when Hong Kong-based rival Klook was able to raise venture capital. The company has sufficient capital and would do well even if the pandemic were the worst-case scenario.
GetYourGuide has worldwide inventory, but has a large proportion of inventory in countries where pandemic restrictions have reduced tour bookings, such as Germany, France, Italy, and the United States
Klook’s main competitors are Airbnb Experiences, Expedia, GetYourGuide, KKday, Musement (owned by TUI), Tiqets (backed by Airbnb), Trip.com, Viator (and its parent company TripAdvisor).
Smaller rivals include Hamburg-based meta-search site Tourscanner and booking site based in Malaysia Buddyz.
GetYourGuide hasn’t focused much on multi-day bookings yet. Thus, brands that have focused on this content, such as the Vienna headquarters TourRadar or a rival, could be considered, according to speculation by experts in recent months.
At recent Skift events, GetYourGuide executives told attendees that the company does not want to copy the path other online tour sellers have taken by acquiring technology providers, such as Booking Holdings acquiring FareHarbor and Viator from TripAdvisor. acquiring Bokun. When asked, Chrestin said GetYourGuide’s stance on this issue has not changed and it won’t be the kind of vertical integration he could consider.
“GetYourGuide has a history of very organic and successful growth,” said Chrestin. “Our point of view is that at some point there is going to be consolidation in this sector. We certainly see ourselves as playing a leading role in this regard, and it’s a step that gives us the flexibility to act. “
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