Trivago Co-Founder on Why It Doesn’t Really Need Expedia
by Dennis Schaal, Skift
In preparing the Trend Report “Travel Metasearch: What’s Coming Next” Skift spoke with Malte Siewert, co-founder and managing director of Germany-based hotel metasearch site Trivago, about Expedia’s investment in Trivago and how the sector is changing.
Expedia Inc. has designs on turning its new hotel-metasearch plaything, Trivago, into the next TripAdvisor. Not in terms of become a hotel-review behemoth, but as a fast-growing asset that one day can be spun out from the parent company, and make Expedia investors a ton of money, just as TripAdvisor did.
Expedia Inc. last year took a controlling stake in Trivago for $564 million in cash plus 875,200 shares of Expedia common stock over a handful of years, and Malte Siewert, Trivago co-founder and managing director, welcomes the investment and vote of confidence.
In the second quarter of 2013, Trivago’s initial quarter within the Expedia Inc. fold, Trivago’s revenue grew 80% year over year as it focused on international expansion into the U.S., Canada, Australia and New Zealand, said Expedia CEO Dara Khosrowshahi.
But, Siewert bristles at the notion that Expedia is now running the show at Trivago, and he vehemently points out that a dramatic increase in marketing spend that has propelled Trivago’s growth does not come from elsewhere in Expedia, but is self-funded, coming out of Trivago’s own resources.
What’s changed? “Nothing,” Siewert says. “We run the business the same way like we did prior to the Expedia deal. That is actually part of the agreement. Expedia has agreed to not run the business and to keep it absolutely independent. And, that is exactly what is happening. All of the advertising we are doing is all funded from our cash flow. So Expedia also is not funding the business in any way.” ...