Announcing Hipmunk's $15M Series B Funding

Congrats to Adam and the whole team at Hipmunk. It's always great to see investments into travel startups, it's a big space in need of lots of innovation.

AndrewWarner2• 14 years ago

Any suggestions for what I should ask Adam? We're recording his Mixergy interview tomorrow about Hipmunk.

porter• 14 years ago

Is "better design" or the agony feature really a sustainable competitive advantage? You're clearly on to something, but why can't someone just copy what you have?

kn0thing5• 14 years ago

When competition makes more than half of their revenue from ads, shutting off that revenue source by copying that UX and striking out pages of advertisements isn't very economically viable.

henryboston• 14 years ago

How much of his success with Reddit does he attribute to his success with Hipmunk?

AznHisoka• 14 years ago

how much time do they spend on SEO, and link building? How do they plan to give Google scalable, indexable content?

MaxGabriel• 14 years ago

Kind of a niche question, but I'd really like to know if Adam thinks his debate experience helped prepare him for running a startup.

mcargian• 14 years ago

What percentage of their traffic comes from paid advertising?

netcan5• 14 years ago

It would be a slight break from your usual dig-into-the-growth-of-the-business questions, but I'd love to hear about some of the reasons (or his thought on) why the market for flights are as insanely complicated as they are. Those kinds of understandings are surely a big part of what you need to succeed here.

volandovengo• 14 years ago

Great question Andrew! I'd love to hear him explain:

why one way flights are often as expensive as round trips, his thoughts on couchsourced flight searching (flightfox.com, current YC batch), their monetization plans, while it is so hard to get the best priced tickets

kn0thing5• 14 years ago

I recommend asking about how important a role his bizdev played in prep for launching the site as well as signing on partners thereafter. The amount of hustle it took to get us in the door with OTAs/airlines at first is not something I see in many of my startups.

anthonycerra• 14 years ago

Why don't YOU tell us :) I'd love to hear about it. Bizdev/Marketing is still really undervalued in startup land.

AndrewWarner2• 14 years ago

Emmett Shear of Twitch just suggested the same thing. Thanks Alexis. I think I'll make this the focus of the interview, and ask the other questions posted here towards the end of the conversation.

spoiledtechie• 14 years ago

I always feel hipmunk has the most expensive prices out of any other airline search engine. They might do it differently, which I like, but their prices seem higher than any other site.

I also love what priceline offers, their price negotiator!!! It always hits well below what the prices of airlines currently offer. Any plans to put this in the future of hipmunk?

netcan5• 14 years ago

Searching for flights sucks, hard. Fixing it with a better ui is a great thing. But ultimately we're experiencing that pain in large part trying to get the best prices. I search for flights about twice a year. Usually between two not-a-hub destinations (currently dublin-tel aviv) so its even harder. Every time I have to do it, I wish that things have improved. They haven't.

Basically, I:

- Go to 3-4 engines or portals. Try to figure out all the airline flying that routes. See who flies where.

- Go to the airlines' sites directly, see if they prices are better (usually they are). Try to remember which airlines (RyanAir) never have fares listed on aggregators. Fill out captchas and tick on boxes to be let in.

- See what the prices are for the most expensive leg & try to put together my own route using two separately bought tickets.

- Try to think of some more exotic routes: change airports in London, fly through a Greek resort island, whatever.

- Call a travel agent to see if they can do better.

I might not get all the way down this list.When I do, I rarely see the same fare twice. When I lived in Australia the stakes were higher and I always went down the whole horrible list. I hate doing this. I'd pay good money to avoid it. But, for my use case UI crappiness isn't the issue(even though doing your grocery shopping on Ebay in 1998 would be a better experience). The problem is centralizing all the available fares onto one site.

netcan5• 14 years ago

Just as an experiment, I tried looking for a trip on hipmunk that I have booked for 10 days from now. Prices start arund $1000 per leg, about 250% higher than what I paid (coincidentally for the same flight).

Slight tangent: You can get these flights (dublin-tel aviv) for around $600-$900 round trip if you're reasonably early and flexible. Why does hipmunk even offer me a $7500 leg that takes 24hr and fly through Toronto? Shouldn't their agony detector realize that no sane person would want this? Isn't good UI also removing useless information? If they want to demonstrate how thorough they are (also important) aren't there easier ways?

I don't mean to be picking on hipmunk. They're obviously dedicated to good user experience and they do a great job of presenting the large amount of information one needs to process in order to book a flight. If any Hipmunk people are reading please take any snarkiness as a cry for help. I really do want a better experience booking flights I'm looking to you guys for them.

ketralnis5• 14 years ago

> Try to remember which airlines (RyanAir) never have fares listed on aggregators

Hipmunk does list RyanAir actually http://www.hipmunk.com/#!DUB.LGW,Nov19.Nov24

HeddiCundle• 14 years ago

You're absolutely right on this! It's the biggest pain in travel: fluctuating prices. All OTA's (online travel agents) have the exact same price (excluding deals) so you're scrambling around searching a futile objective. 85/90% of us at the time of about to press 'book it' decide to check elsewhere; 42% of us spend 4 weeks hunting travel; 52% of us look at 4+ websites. It's a total pain. Which is why we created www.mytab.co - directly with this in mind. By saving travel cash &/or having friends contribute to your trip, you're now not focusing on the price at the time of booking because you're cash rich (it's like monopoly money) and a happier booking experience. AND since we run a gift card platform, we can negotiate exclusive deals on your behalf. For the first time ever, the customer will be empowered yet this is also amazing for the travel industry who can now stabilize their slow time/long lead bookings. We created myTab for people like you who never have a decent search/book experience :)

c0mpute2• 14 years ago

Can someone explain how do these free flight search engines make money?

In my case I search using Kayak, but never really book the ticket from Kayak (don't follow their link to the airline). I go directly to the airline site and book it there. Many people I know do the same. I despise using Orbitz/Priceline other than just a cursory glance to see if there are cheaper tickets. I know that sometimes an itinerary involves multiple airlines and that is when there might be an advantage booking through, say Orbitz, but even in those cases I just book separate tickets.

Why is this free search/booking industry still unsaturated and is there really a demand for such capital infusion?

Update: My question is specific to flight search, because I think hotel search can be profitable model as sometimes these sites provide better rates than the hotel's site.

lacker• 14 years ago

"In my case I search using Kayak, but never really book the ticket from Kayak."

A lot of people do book from Kayak just because it's easier. So, don't assume you are the typical customer here. Also, I am not familiar with Hipmunk's numbers but I believe that hotel search is the real revenue generator for these sites, and flight search just acts to get people in the door.

c0mpute2• 14 years ago

True, I think logic suggests most people find it convenient to just click the result link on Kayak, which has made it so easy compared to Oribts, which has its own booking engine. So I am guessing they just make a very small percentage of the sale just for referring.

If as you say the hotel search is the real deal, it makes sense. Which leads me to the next thought, wonder why hotels haven't caught up with the airline industry in having a fairly realistic price listing on their own site? In fact, most of the times I am ok just booking using priceline bidding for hotels.

netcan5• 14 years ago

It's really such a high value traffic area that you can be monetising traffic, especially if you're not looking to squeeze the last drop of money, is pretty easy.

stickfigure3• 14 years ago

Am I the only one that thinks "Ugh, not making money yet"?

Yes yes, I know about burning cash (err, growing) as fast as possible to lock down winner-take-all markets, but travel booking doesn't seem like one of those. There doesn't seem to be any switching cost other than typing a different url in the browser. I don't see any network effects. Am I missing something?

This is a business with revenue streams and cash flow. They've been around for two years. They've already raised more than $5mm. When I hear "we raised another venture round" my gut reaction is concern, not congratulations.

As far as the product goes: The UX is nice. But every time I tried hipmonk, the prices were higher than what I found elsewhere, so I stopped using it.

patrickaljord• 14 years ago

> But every time I tried hipmonk, the prices were higher than what I found elsewhere, so I stopped using it.

Same here, love the UX but when I first tried it a couple of years ago, prices were higher. I tried it again only a couple of weeks ago and prices were still much higher. It looks like hipmunk is an engineer driven company focused on technical stuff (great UX, no ads) but what's important here is getting the best deals with flights providers and they're still not there yet, even two years after the launch.

veyron• 14 years ago

The problem is twofold:

1) for customers price is more important than UX

2) price is a relationship, not discovery, game

You can't get access to the really deep deals without relationships, and if you are not the primary you have to undercut competition.

IMHO the best play is to build the UX and then flip it to a company like Kayak.

tedivm• 14 years ago

Are they actually higher though? I found the same thing you did, except when I tried checking out of the other places I found they would place fees on top of things. Turns out Hipmonk just adds those fees in from the start. In my experience they end up coming out the same.

ketralnis5• 14 years ago

> every time I tried hipmonk, the prices were higher than what I found elsewhere

Can you be more specific? We (Hipmunk) get our data from the same places that most everyone does, fares aren't really something that's variable from site-to-site (Southwest aside)

The only thing I can think of is that we list fares after taxes and fees, and many other sites list fares before them

didip• 14 years ago

You have many different types of customers, don't worry...

I booked last minute flight to SFO 2 days before Fluent Conf through Hipmunk. I was glad to get the perfect flight schedule and the whole experience took less than 15 minutes.

Loved the UI, didn't matter even if I ended up paying more.

airlocksoftware• 14 years ago

I wasn't aware of this; you may want to think about how you can better communicate this to your users.

dtr777• 14 years ago

Actually, most aggregators that I've used (hotwire, priceline, etc) all include taxes and fees so I'm not sure what you're referring to here.

I think the purpose of Hipmunk (and what makes it different) is that it takes more things into account than price, right? You prioritize flights that have the most optimal times with the best price, am I correct? I found they were most similar when you selected price as your priority when looking flights.

If anything, a feature I think I'd enjoy would be a fare predictor because most aggregators to have this feature and it's nice to know when you should buy.

Arelius• 14 years ago

Where are the same places that most everyone gets their data from?

ashbrahma• 14 years ago

Actually, I just tried something today. I was looking for fares to the SF Bay area (OAK, SFO or SJC) and Kayak found fares(with taxes) that were 30 dollars cheaper. Flexible search isn't easy with the current Hipmunk UI.

smsm42• 14 years ago

One thing that Kayak is doing better than Hipmunk is multi-airport things. I.e. We have here in Silicon Valley SFO and SJC. I usually prefer SJC, but can fly from SFO too. Some flights are cheaper or have less connections if you depart from SJC but arrive to SFO, or vice versa. I couldn't find how to tell Hipmunk that it is OK (or not OK) to use different airports for round-trip. Kayak does it very nicely. It also seems pretty hard to say "I like these dates but wouldn't mind to go day earlier-later if that gets me couple of hundreds of dollars back".

pbz• 14 years ago

People expect the before taxes fee, because most seem to do this. Yesterday I booked a hotel on Orbitz via Hipmunk (I like the map view btw). There was roughly $10 price difference, i.e. Hipmunk was showing $X but after clicking on the link, on the Orbitz site it was showing $X-$10. It's a nice surprise, but I wonder how many didn't bother to check...

rscale• 14 years ago

I'd note that I find Hipmunk weird and non-intuitive. Here's an example: http://cl.ly/3o2Y0z0w0a1l3c3d1X3G

There's a few things in that shot that confuse me, but the top timeline bar is not something I glance at and understand.

stickfigure3• 14 years ago

Here is an example: One-way flight SFO -> LEX (sadly relevant to my interests) somewhere around August 20.

Hipmonk, $245: https://img.skitch.com/20120613-8rregkqr2exgrcppt87j8hggy8.j...

Kayak, $179: https://img.skitch.com/20120613-gjy1r3as42atrp3ack1m24eyc8.j...

For some reason Hipmonk isn't finding the $179 United flights. That $179 includes taxes and fees.

In addition, Hipmonk's flexible search is far more limited than Kayak's. Hipmonk allows +2 days for a total of 3 possible. Kayak searches +/- 3 days, for a total of 7. Also Kayak has the "nearby airports" feature which often drops the price even further (Louisville is $149) - especially in the Bay Area where SFO and OAK are both a bart ride away.

LokiSnake• 14 years ago

Are you sure? I originally thought the same thing but Hipmunk simply includes all the taxes and fees in the price they display, so it almost always ends up the same for me when checking out.

rokhayakebe• 14 years ago

While we are on the subject, does anyone have a good website to find when is the cheapest time to fly to a particular city?

ketralnis5• 14 years ago

Hipmunk does Calendar searches, like http://www.hipmunk.com/#!London.Boston,Next+Month.Next+2+Mon...

bawllz• 14 years ago

I like Adioso, though I think it works best within australia. Give it a try!

joshu• 14 years ago

i probably should have invested in this one when i had the chance.

gyaresu• 14 years ago

I find that the ITA iOS app from http://itasoftware.com/ (Google owned) consistently brings me the best prices and then I book direct through the airlines website.

I fly mainly International.

Announcing Hipmunk's $15M Series B Funding

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