Global Courant
GetYourGuide CEO Johannes Reck.
GetYourGuide
German online travel startup GetYourGuide raised $194 million from investors, hoping to capitalize on rising demand for travel services in the summer, foster expansion into the US, and invest in large language models and other artificial intelligence tools.
The Berlin-based company said on Thursday it had raised funding through a mix of equity and debt, with an $85 million equity investment led by US asset manager Blue Pool Capital.
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The investment values the company at nearly $2 billion, up from GetYourGuide’s last publicly disclosed valuation of $1.4 billion, according to a person familiar with the matter. Existing investors KKR and Temasek reinvested in this round.
The debt portion of the deal was led by UniCredit and also backed by BNP Paribas, Citibank and KfW. The total investment in GetYourGuide, including both equity and debt, is now just over $1 billion.
GetYourGuide’s product differs from some of the other major online travel players. Instead of advertising hotels, flights, and other forms of transportation, GetYourGuide sells its user experiences and things to do in unexplored places.
These experiences are offered through third-party providers on the platform, with GetYourGuide charging a commission for each booking.
The company has seen a huge increase in demand for its platform, with travel returning to normal following the end of Covid-19 restrictions and the resumption of normal cross-border travel.
Johannes Reck, the CEO and co-founder of GetYourGuide, said the company’s revenues were wiped out during the early days of the pandemic — for several consecutive quarters, the company made no revenue at all, he said.
“We were seriously depressed during the pandemic,” Reck told CNBC. “The travel industry has been hit hard within the travel industry. GetYourGuide was probably one of the hardest hit. Experiences were shut down. People weren’t going out.”
“There were some greenshoots in 2021 with the US reopening, but the real recovery didn’t start until omicron turned out to be a more benign variant and people started traveling Easter of 2022 and then we had exploding business.” he said.
GetYourGuide saw its sales volumes double in 2022 and quadruple in the first quarter of 2023 compared to 2019, Reck said, citing a pre-pandemic benchmark as 2020 and 2021 were significantly lower in terms of activity.
To offset the decline in physical experiences, GetYourGuide began offering users virtual tours and other experiences. More recently, it has started offering its own exclusive branded experiences called “Originals”.
They include the opportunity to turn on the lights of the Sistine Chapel at the Apostolic Palace, the pope’s official residence in Vatican City, and visit New York’s Museum of Modern Art one hour before regular opening hours.
Travel experiences is a market that Reck estimates is worth $300 billion today, while he thinks the total addressable market for experiences overall could be worth $1.5 trillion.
GetYourGuide will use the new money to expand its US business, which has been a huge source of growth for the company over the past year. The company also plans to invest more in AI and other product development, with the use of large language models, or LLMs, being a major focus.
LLMs are algorithms trained on massive amounts of data that learn how to recognize, summarize, and generate text and other types of content. They power so-called generative AI systems, which allow users to generate new content by entering certain prompts.
GetYourGuide says it is already integrating LLMs into its business to automate the description generation of experiences such as local pizza and pasta courses and riverboat cruises on the Seine in Paris.
LLMs could also be useful for letting people explore new areas and gain experience with improved personalization of recommendations, Reck said. Google is making rapid progress with its work on AI amid concerns over the threat of LLMs to its dominance in online search.
