The co-founders of Getaroom have sold a majority stake in the business-to-business hotel and vacation rental provider to private equity firm Court Square Capital Partners, whose other holdings include car rental company Auto Europe.
Getaroom President Bob Diener told Skift Tuesday that he and his business partner for the past 35 years, Getaroom CEO Dave Litman, still maintain a substantial minority stake in Getaroom, and sold the larger stake to help the company reach the next level, including accelerating international expansion.
Diener and Litman, former college roommates, co-founded Hotels.com in 1991, and sold a majority stake in that company in 1999 to USA Networks. Diener said he and Litman retain more of a stake in Getaroom after the Court Square deal than they did after initially selling Hotels.com to USA Networks.
Getaroom and New York-based Court Square did not disclose additional terms of the deal. With 300-500 employees, one company-owned call center, and four additional calls centers, Getaroom will do more than $1 billion in gross sales in 2018, Diener said.
He added that Getaroom has been self-funded until now, and has been profitable for the past five or six years.
Dallas-based Getaroom launched in 2009 as a hotel-booking site for consumers, but soon thereafter pivoted into a business-to-business provider of hotels — and lately vacation rentals, too — to affiliates, including online travel agencies, metasearch sites, airlines, destination sites, and membership clubs, for example.
Under the Getaroom business model, it contracts with hotels for published rates, unpublished rates sold through its call centers, and member-only rates for people who belong to membership clubs.
“Nothing has changed in the day-to-day but we now have a faster growth trajectory and we have more resources,” said Diener of the Court Square sale. He said there will be no layoffs, and the Getaroom name stays the same.
Court Square, which specializes in midsize companies, has plenty of travel and international experience, he said. In addition to owning Munich, Germany-based car rental firm Auto Europe, it previously was an owner of global distribution system Worldspan under Court Square’s prior name, Citigroup Venture Capital Equity Partners.
“Our door was banged and knocked on a lot in the last couple of years,” Diener said, but opted to sell now so it could transition to “the next level” because of Court Square’s tech resources, financial stature, and international experience.
Diener said the company offers some 200,000 hotels, and about `10,000 professionally managed vacation rentals. In addition to English, Getaroom has sites in Spanish and German.
The Getaroom-Court Square deal closed August 23, but hasn’t been reported until now.
Houlihan Lokey served as a financial advisor to Getaroom, and Lidji Dorey & Hooper offered legal advice. Dechert LLP served as legal advisor to Court Square.
Source: Skift, Dennis Schaal