New York City Mayor Michael Bloomberg speaks during his final State of the City speech at the Barclay's Center in Brooklyn, New York, February 14, 2013. Brendan McDermid / Reuters

New York City mayor Michael Bloomberg told the head of a taxicab fleet that he plans to “fucking destroy” the city’s taxi industry when he leaves office on January 1. Bloomberg’s frustration with New York’s yellow cabs and their drivers stems from their unwillingness to adopt new technology such as accepting electronic passenger hails from smartphones, and their resistance to one of the mayor’s pet projects, a redesigned Taxi of Tomorrow.

There aren’t a lot of people who can credibly threaten to upend an entire microeconomy. The mayor is a billionaire, though, and he might just have the wherewithal to make it happen. So how might he go about it?

Well, first, when Bloomberg says “destroy,” we’re going to presume creative destruction, not physical annihilation. (It’s not that he couldn’t literally wipe out the taxi industry—with his $27 billion in personal wealth, he could undoubtedly afford the requisite military hardware—but even the famously direct Bloomberg might consider such a method unsubtle.) But isn’t car-service app Uber, which lets users order a cab, see on a map how far away it is, and pay for it, all through their phones, already going to disrupt the hidebound taxi industry?

Well, probably not while it’s so expensive (although, in my personal experience, the cheaper UberX option has proven cheaper than Los Angeles taxis). More importantly, though, Uber still faces an enormous challenge as long as paid automotive transportation is heavily regulated by public officials under the sway of a concentrated bloc of self-interested small-business owners riding in culturally significant yellow sedans. Uber, along with competitors like Zimride, exists in a regulatory grey area that officials from New York to San Francisco are trying close down, and while they may claim—with some justification—to be worried about consumer safety, a lot of the rules in mind, like banning lighter, eco-friendly cars or using GPS to calculate fares, clearly don’t have safety as their first concern.

Still, the laws that have allowed cabbies to block Mayor Bloomberg’s top-down technocratic paternalism while in office are the same ones that keep Uber from disrupting the the hired car sector from below. So if Bloomberg is serious about this smashing-the-yellow-cab-monopoly thing—and please, let him be—what does he have that Uber doesn’t? The answer is the distinguishing feature of his entire political career, from the shift in party allegiance that marked his first mayoral run to his quixotic campaign to enact gun safety rules: His firm belief that money well-deployed can buy any political outcome. And, of course, that $27 billion.

A heavily regulated marketplace creates high barriers to entry, but sufficient capital can break through them. Uber has raised $50 million since 2010, and while it doesn’t release revenue figures, it’s clearly in a precarious position when it comes to fighting regulatory lawsuits and city rule-makers. But a Bloomberg-funded trade group, with publicists, lobbyists and lawyers could open the legal doors, while Uber and the like force mobile efficiencies into the sector.

And then the market will provide all the destruction a megalomaniacal billionaire could want.

This story originally appeared on Quartz, a Skift content partner.

Additional links from Quartz:

• The UK’s fastest growing tourist group endures the slowest visa process
• Something is wrong when a country says it’s 40 million rolls short on toilet paper
• Tesla’s next model: a $450 million convertible (debt) offering

The post Uber and Bloomberg could one day join forces to “destroy” NYC’s taxi industry appeared first on Skift.

Room 77 employees take a break from "turning hotel search inside out" or whatever else they do at company headquarters. New CEO Drew Patterson (center, on the couch) thinks these are very early days for hotel metasearch. / Room 77

Drew Patterson, who recently became Room 77′s first CEO, does a perceptible double take at the seeming absurdity of the question.

“How is Room 77 going to meet the challenge of being relatively late to the party?” he’s asked.

After all, the first crop of travel metasearch sites, including FareChase, SideStep and Qixo, are now distant memories of a bygone Travel 1.0 era, and notable players such as Skyscanner and Kayak have each been refining their products and building traffic for about a decade already.

How, then, are travel startups such as Room 77, which only debuted its hotel-metasearch business about a year ago, and Hipmunk, founded in 2010, going to compete against the bigger and and more-established players?

It may be late, but it’s still early

Patterson believes it’s actually early rather than late.

“It’s the very early innings of the shift to mobile,” Patterson says, noting that a massive shift in consumer behavior is under way as travelers reach for their smartphones and tablets, often even when the desktop is within easy reach.

“Mobile is the catalyst,” Patterson adds.

Patterson argues that travel search is a great fit for mobile as travelers won’t need a plethora of apps, they may be on-the-go searching for a hotel, and can benefit from streamlined side-by-side comparisons “when there’s no keyboard and screen real estate” is scant.

In some ways, as relatively new and funded travel startups, Room 77 ($43.8 million) and Hipmunk ($20.2 million) find themselves in similar situations. How are they going to break out of the pack in the battle for global traction, and site and mobile visitors?

“It all starts with the right product,” Patterson says.

Is Room 77 different enough?

In that regard, one can make an argument that Room 77 currently has a more differentiated product than Hipmunk’s.

Sure, Hipmunk has its much-touted and attractive user interface and Agony index, and can adeptly enable users to search for hotels based on the location of their business meetings, too.

But, consider some of Room 77′s differentiators:

• Room 77 offers simulated room views for around 1 million rooms at hotels that are three stars and above, and also features insider tips for choosing specific rooms, hotel floors, or vantages (pick a room facing E. 33rd Street) at around 16,000 hotels.

• You can book about 200,000 hotels on Room 77 without having to navigate to another hotel or online travel agency website, and many of these properties enable guests to delay payment until hotel checkout, a spokesperson says. Customers can also book hotel stays from the Expedia Affiliate Network and Getaroom.com without leaving Room 77.

• In addition to displaying rates from various online travel agency and hotel websites, Room 77 also shows AAA, senior, government and military rates.

• At four- and five-star hotels booked on Room 77, you can indicate your room preferences and Room 77′s Room Concierge service will attempt to get you a specific room type or location to match your likes and dislikes. During the booking process, guests can also give hotels special requests such as putting flowers in the room for an anniversary etc.

The tortoise and the cheetah?

Patterson argues that Room 77′s site speed is a differentiator, too. Around the Skift office, we informally gauged the pace of Room 77′s loading of hotel search results against those of Hipmunk and Kayak. Room 77 may have been a tad quicker, although this was far from a scientific study, and the contest was close.

However, the speed of TripAdvisor’s hotel metasearch results seemed like a tortoise compared to Room 77′s cheetah.

Breaking into seeming talking points mode, Patterson says Room 77′s “speed, intelligence and relevance is second to none.”

Founded in 2009 by Brad Gerstner, a former co-CEO of National Leisure Group and avid travel industry angel investor, who serves as Room 77 chairman, the company first focused on its room view technology after having acquired OpTrip and TripKick for their tech and talent.

Changing views about the business direction

Room 77′s room views, created by plotting a room’s latitude, longitude and altitude, and then marrying them with Google Earth, are still part of the site, but they are relegated to the lower portions of the page. Many hotels weren’t exactly enamored with the idea of giving consumers the option to book a specific room, which was Room 77′s ultimate intent, although there is indeed some of that going on in the hotel industry today.

At the time, Room 77 enlisted hotel guests with its iPhone app and spent a lot of energy in the early days collecting hotel floor plans to build the world’s largest database of hotel rooms.

That process may be ongoing, but Room 77 pivoted toward hotel metasearch and got into it in a meaningful way about a year ago.

Independence, with a few dependencies

With 38 employees, Mountain View, California-based Room 77 has implemented a different funding strategy than its Hipmunk competitor and neighbor in nearby San Francisco.

In January 2013, Expedia, Concur, Sutter Hill Ventures, General Catalyst Partners, Felicis Ventures, and a bunch of angels, including Rich Barton, Erik Blachford, and Spencer Rascoff, participated in a $30.3 million Series C round, bringing Room 77′s total funding to $43.8 million.

With its $20.2 million in funding from the likes of Institutional Venture Partners and Ignition Partners, not to mention Ashton Kutcher, Hipmunk doesn’t have Expedia- and Concur-like strategic investors, and Hipmunk CEO Adam Goldstein argues this gives Hipmunk a competitive advantage with potential partners because it is “independent.”

Investments from Expedia and Concur send a signal about Room 77′s direction and strategy, Goldstein argues.

In fact, Goldstein says: Hipmunk is “one of the last independent metasearch companies in the U.S.,” and “one of the fastest growing.”

Patterson of Room 77 isn’t buying Goldstein’s analysis, saying: “I’m not sure they [Hipmunk] could make up more asterisks on what they are number one in.”

Patterson says Expedia and Concur are “passive investors” in Room 77, and they don’t have seats on Room 77′s board.

Still, Patterson says, “we are in active discussions with those guys.”

Expedia, Trivago and Room 77?

It may not be too far-fetched to speculate that one day Expedia, which recently poured $632 million in cash and stock into German hotel metasearch site Trivago, taking a majority stake, could one day consider acquiring Room 77 outright. If it paired Trivago in Europe with a growing Room 77 in the U.S., then Expedia could build a base to begin to challenge Priceline-Kayak in the global online travel battle.

Patterson doesn’t touch that speculation, but says Room 77 is “well-capitalized,” which gives the company “enormous flexibility.”

Room 77 is experimenting with online marketing through different channels, although the key would be to find the right ways to engage consumers, and not just buy traffic, Patterson says.

“Having that kind of dry powder,” Patterson says, referring to Room 77′s funding, “creates flexibility. Do we want to go offline [with advertising]? We have the capital to do that.”

Hotel metasearch is a crowded field with intense competition. Search engine marketing is very expensive, and titans of metasearch, such as Kayak, undoubtedly command better unit economics than startups like Room 77 and Hipmunk because of their much smaller footprints.

And, let’s not overlook TripAdvisor, which will undoubtedly play a huge role in shaping the market.

However, even with those disadvantages, amply funded travel startups such as Room 77 and Hipmunk are currently focusing mostly inward on their products, and aren’t in a huge hurry to play the big, paid-marketing game.

After all, if you believe Room 77′s Patterson, these are the early days.

“The smartest investors in this category see huge growth to come in search,” Patterson says. “We are playing with where the business can be five or six years from now, and not the next quarter.”

This is the second of a four-part series on funded travel startups, looking at where they started and their strategies for breaking out of the pack.

Part 1: The real-world challenge for travel startups, as mirrored in Hipmunk’s story 

The post Will Room 77′s deep pockets and strong hotel product get it a seat at the table? appeared first on Skift.

Hipmunk CEO Adam Goldstein, left, and co-founder Steve Huffman. / Hipmunk

Hipmunk co-founder and CEO Adam Goldstein, 25, believes his flight and hotel metasearch company can one day be larger than Kayak, and with $20.2 million in funding and revenue that has trickled in from the moment Hipmunk debuted, he thinks he has the time to prove it.

“We think we can be bigger,” Goldstein says, referring to Kayak. “We think we can do it.”

With Priceline closing today on its $1.8 billion acquisition of Kayak, you can picture the Kayakers reading Goldstein’s boast, and breaking out in giggles as they pour their champagne (or whatever the favorite libation is over there).

After all, in the first quarter of 2013, nine-year-old Kayak reported more than 357 million user queries from desktops and mobile devices, 3 million app downloads, and $82.3 million in revenue. And, Kayak was in the black, wrangling net income of $2.1 million.

As a private company, founded in 2010, Hipmunk doesn’t break out a lot of numbers, although Goldstein says the overall business, including searches, bookings and revenue, has been “more than doubling every year since we started.”

Although these sorts of measures can be notoriously unreliable, Compete’s U.S. numbers peg Hipmunk’s monthly unique visitors at a fraction of Kayak’s, and even show Hipmunk trailing rival Room 77, which debuted its core hotel-comparison shopping product in late 2011, more than a year after Hipmunk burst on the scene.

Debatable

It’s hard to debate Goldstein’s premise that Hipmunk can one day beat Kayak because it is an open-ended goal, there are so many variables, and anything’s possible.

Then again, it is difficult to debate Goldstein about anything because he was the captain of the MIT debate team during part of his 2006-2010 stint at the school, although he doesn’t try to aggressively score points when recounting Hipmunk’s journey.

Goldstein was in charge of arranging the debate team’s national and international travel, and he found that it took so much time and was so frustrating that it led to what he calls an “aha moment” during his senior year about working on a travel startup.

The idea at first was to build a travel agency, one that would enable consumers to quickly make decisions based on a comprehensive array of choices, including flights, hotels, cars, trains and buses.

One of the first people Goldstein talked to about his ideas was Reddit founder Steve Huffman, whom Goldstein met during his high school years at what he describes as a “nerd conference,” Foo Camp.

Huffman, who would become Hipmunk’s co-founder, was experiencing his own frustrations about travel search as he was commuting across the country to visit his fiancé.

Goldstein says Huffman initially was skeptical, saying: “Why would we want to get in a fight with those guys?” referring to powerful, entrenched online travel agencies and existing metasearch players.

In retrospect, most people would think Huffman’s warning was on point when you consider that if Hipmunk were to aggressively engage in search engine marketing these days, it would face an uphill battle of competing for keyword real estate with hotels, other metasearch companies and online travel agencies, including Priceline, which spent $403.1 million in online and offline advertising during the first quarter.

“Suckage” and “Agony”

After graduation, in June 2010, Goldstein and Huffman were accepted into Y Combinator, and they had a three-month deadline to launch a product and pitch it to investors.

“We hadn’t written a single line of code yet,” Goldstein recalls. “We didn’t know what we were building yet, either.”

They decided to start with flight metasearch, and after a few weeks when no one would return their phone calls, they eventually struck a partnership with Orbitz as Hipmunk’s initial data source (ITA Software came later) and booking partner.

Huffman and Goldstein had come up with an attractive user interface, something that would get a lot of buzz and feature an Agony index, which would remove the pain of flight search by succinctly sorting flights based on price, duration and the number of stops.

They got Hipmunk online a week before Y Combinator’s demo day, and what was to become the Agony index was initially called Suckage.

But, the two entrepreneurs figured a lot of publications wouldn’t write about something with such a vulgar-sounding name so “literally the day before we launched at Y Combinator,” the co-founders ran a thesaurus search on “pain” and decided on “Agony” as the name for their now well-known sort option.

Approaching three years later, Hipmunk has raised $20.2 million in total funding, with a Series B round of $15 million, led by Institutional Venture Partners and with participation from Series A leader Ignition Partners, having been completed in June 2012.

Not in anyone’s pocket

With Kayak transitioning into the Priceline fold, Expedia taking a majority stake in German hotel-metasearch site Trivago, and Expedia also leading a $30.3 million Series C round for Room 77, Hipmunk finds itself as “one of the last independent metasearch companies” and “one of the fastest growing in the U.S.,” Goldstein says.

For the record, Room 77 CEO Drew Patterson says the company’s investors, which include Expedia, Concur, Sutter Hill Ventures, General Catalyst Partners, Felicis Ventures and a bunch of angels, are “passive investors,” and none sit on the Room 77 board.

But, Goldstein argues that Room 77′s investment path sends a signal, and that Hipmunk enjoys a competitive advantage as an independent force when it goes to striking hotel-partnership deals.

“The fact that we are not associated with their enemies is powerful,” Goldstein says.

Very positive reviews and loyal following

Hipmunk has garnered stellar reviews from the tech press and users for its attractive UI, ease of use, and its iOS and Android apps from their beginnings.

Recent initiatives include a revamp of Hipmunk’s mobile apps, and the option to book on Hipmunk (via Expedia in the background) instead of having to navigate away from Hipmunk and over to hotel and online travel agency sites. The mobile app for the first time features plenty of other online travel agency booking partners beyond Orbitz.

Almost everything Hipmunk does, from its flight and hotel search UIs, to its mobile apps, is pretty.

For example, take the Hipmunk Pricegraph, launched late last year and geared for consumers whose travel dates are totally flexible.

Pricegraph shows airfares over the next 90 days: Just view airfares and select departure and return dates from the graph, choose book this flight, and you can view a summation or full flight details before navigating over to United.com or some other airline or online travel agency site.

Goldstein says once people use Hipmunk, “they generally like it a lot,” and come back to use it again.

But how is Hipmunk going to get users to discover it and fight for eyeballs against larger players with much larger bank accounts?

Goldstein says Hipmunk still has much work to do in marketing, partnerships, and the product sides before it makes a decision on keyword marketing.

“While I think our product is the best in the marketplace already — and our users agree — I think we can still make it better, and we are going to do that, before we blow tens or hundreds of millions of dollars yelling it out to the world,” Goldstein says.

“It’s a little unoriginal to take that route that other travel sites have done in throwing money at it,” Goldstein adds, noting that Hipmunk may get creative in its eventual strategy.

Meanwhile, Goldstein acknowledges that Hipmunk erred in its initial focus on flights, and now most of its resources are directed toward improving its hotel and mobile products, with the latter being its “fastest growing piece of the business.”

Long-term outlook

Hipmunk can afford to hang around for a long time while it fine-tunes the user experience. It has $20.2 million in total funding, revenue coming in, and a relatively lean staff of 33 people. In contrast, Hotel Tonight, with some $35.7 million in funding, employs about 100 people.

Goldstein says Hipmunk’s financial situation is “great,” and while the company is now past its “early phase,” Hipmunk can afford to invest the “vast majority” of its resources into hotel search.

“We don’t have any need to raise money until we are ready to,” he says.

The problem, though, for Hipmunk, Room 77, Hotel Tonight, and other funded travel startups, is how do you achieve scale, and get into the position where your unit economics are so attractive that they spur even more growth.

“We are nowhere close to the size of Kayak,” Goldstein says, adding that he believes Hipmunk’s partnership deals are “competitive” with others in the industry. “There is tons of headroom and it’s going to take time to get there.”

Of course, being acquired by a larger company could always help a company keen on growth. (An acquisition can also totally screw things up.)

But, when asked what advice he would give to early-stage travel startups, Goldstein provides some hints about the preferred end-game, or at least the medium-term outlook.

He advises co-founders of travel startups to ensure they have “a common vision for what success looks like” as one co-founder may be wowed by an early acquisition offer, and the other may want to hold out for bigger and better things.

Says Goldstein, on the topic: “We have plenty of acquisition interest. But, we are interested in staying independent.”

This is the first of a four-part series on funded travel startups, looking at where they started and their strategies for breaking out of the pack. 

The post The real-world challenges for travel startups, as mirrored in Hipmunk’s story appeared first on Skift.

This week’s SkiftSeedlings speaks to that breadth of opportunity by including everything from a media company looking to launch the world’s largest consumer travel event to a small device that tracks employees’ driving behaviors.

GET YOUR DAILY DOSE OF SKIFT: SUBSCRIBE TO OUR NEWSLETTER, RSS, TWITTER OR FACEBOOK.

FOR ALL OF OUR SKIFTSEEDLINGS COLLECTION, CHECK OUT OUR ARCHIVES HERE.

The post Five startups that want to define the future of travel in five different ways appeared first on Skift.

A woman rushes to catch her cab in New York City. David Thompson / Flickr

New York City’s much-anticipated e-hail app program was cut short by a temporary restraining order (TRO) just days after launch, but that hasn’t halted the operations of the two startups that were already approved for participation.

Hailo and Uber‘s cab drivers continue to pick up passengers via the companies’ mobile e-hail apps every day.

Why do they continue to operate even after the pilot program was so clearly blocked?

That’s an answer that no one seems able to agree on, or in some cases, even answer.

New York’s Taxi and Limousine Commission is tight-lipped as it works out what will happen next. Uber is similarly quiet, while Hailo is taking another approach that includes court sessions and courting Prince Harry.

Uber and Hailo in NYC

Even though Hailo and Uber are similar in allowing customers to use their respective apps to hail yellow cabs in New York City, the startups have reacted very differently to the TRO.

Uber spokesperson Matt Mittenthal declined to comment to Skift’s inquiry, but he did note that its competitor, Hailo, “is also operating at the moment under the same conditions.”

Hailo continues to aggressively pursue its entrance into the New York City market. The startup sent out an email on May 10 asking early Hailo Beta testers to “Tweet a pic of your first ride and tag it with #SaveOurSoles to score five Beta invites to share with your friends.”

It announced its open Beta via email on May 14 and tweeted a picture of Prince Harry receiving a brief tutorial of the app from co-founder Russell Hall the next day.

Hailo co-founder Russ showed Prince Harry how to use Hailo to get home after a big night at the @uktiusa Tech event: hailo.to/l4naQ

— HailoNYC (@HailoNYC) May 15, 2013

Hailo heads to court

Hailo CEO and co-founder Jay Bregman went to court on May 6 to argue that the startup doesn’t need a pilot program to run in New York.

Bregman’s affidavit (embedded below) estimates that Hailo is losing some $18,000 every day that the Pilot Program remains ordained. He also said that several of Hailo’s key employees have deferred payment, and six city launches have been delayed as a result of the changing situation in New York.

Bregman tells Skift, “The TRO enjoins the Pilot Program, not Hailo. In fact, we specifically went to court to clarify that point and the judge said unequivocally we were not affected by her ruling. The City has consistently maintained that absent the Pilot program e-hailing is legal – that there are no rules or laws preventing it.”

Stance of the Taxi & Limousine Commission

As Bregman points out in the affidavit, the Taxi & Limousine Commission‘s approval of the Pilot Program is key to eliciting cab drivers’ participation.

“It is apparent that many taxi drivers are wary of using e-hail applications without the express endorsement of the TLC, which is now tied to the fate of the Pilot Program,” Bregman writes in the affidavit.

TLC Commissioner David Yassky was bullish on the eventual success for the pilot program even after the pilot program was cut short.

Yassky is quoted as saying “The Supreme Court was absolutely right that taxi-hailing apps are not only good for the riding public, but perfectly legal as well.  It is appalling that narrow commercial interests continue to try to block passengers from using the latest technology….We’re confident this program will move forward.”

The Taxi & Limousine Commission; however, has been less forthcoming about its current position since the pilot program block.

The TLC was scheduled to meet on May 16, and although the meeting was ultimately cancelled, the e-hail app program was not on the agenda.

“I don’t expect it to be relevant to this meeting, other than a mention of the TRO during the chair’s report at the start of the meeting,” TLC spokesman Allan Fromberg responded in an inquiry from Skift.

New York City’s statement

The quotes captured from what appears to be New York City’s main spokesperson on the topic over the last three weeks make it difficult to deem the city’s official stance on the issue.

On May 1, the TLC cites Michelle Goldberg-Cahn, Senior Counsel of the NYC Law Department as saying, ”It’s unfortunate that taxi riders will not be able to continue to test this innovative tool for hailing taxis.”

One week later, Goldberg-Cahn confirmed in a statement to the New York Daily News, “There are no regulations that prevent e-hailing per se.”

When Skift asked TLC spokesman Fromberg on May 14 if Uber or Hailo were allowed to operate outside of the pilot program, he could only reply:

From City attorney (Senior Counsel) Michelle Goldberg-Cahn: “The City is fully complying with the TRO.”

The fate of New York City’s e-hail apps is still pending, but we could have an answer by Monday evening.

A final decision on whether the restraining order will stand or be appealed will be issued on May 20 when a full panel of Appellate Division judges decides on the petitioners’ motion for an injunction.

Below is the affidavit of Jay Bregman, CEO and co-founder of Hailo, which outlines the impact of the pilot program’s delay on the plausibility of an eventual launch.

Download (PDF, 1.89MB)

The post Do Hailo and Uber taxi e-hail apps defy a NYC judge’s orders? Nobody knows appeared first on Skift.

To accelerate our growth, we have raised an additional $1.1 million in our seed round, from a great list of seed funds and mix of new angels and some previous angels. We are using this funding to double on our staff (from 5 so far to 10, in a month), build out the initial sales infrastructure, and continue building out our data services.

This new funding is led by Lerer Ventures and includes Ironfire Angel, MESA+, Advancit Capital, Growlab+LX Ventures (investing together). New angels investing in this round include Jason Calacanis, Michael Cunniff, Duncan Jennings, Sean Keener, Shakil Khan, Martin Nisenholtz, Paul Noglows, and Michael Yavonditte.

These investors join a previous group of media-tech angels, all of whom are listed in the factsheet below.

The full funding factsheet — including our progress so far — embedded below:

Download (PDF, 176KB)

For more on Skift’s vision, see “Building a Business Information Brand in 2013” presentation our CEO gave as a keynote tob the American Business Media Association’s 2013 annual conference.

The post Travel information brand Skift raises an additional $1.1 million in seed funding appeared first on Skift.

A car with the RelayRides magnet in central San Francisco in August 2011. Michael Andersen / Flickr

With a still small, but growing, market around people that want to rent out their personal cars to their neighbors, some consolidation seemed inevitable. On Tuesday startup RelayRides, which was one of the first companies to jump into the neighborhood car sharing market, announced that it has acquired Wheelz, a startup that had originally focused on building car sharing communities at universities.

RelayRides says it will acquire, among other things, Wheelz’s DriveBox technology, which enables Wheelz users to unlock and drive away in a rented car, without having to meet with the owner and get a key. Picture it basically like one of Zipcar’s unlocking and verification systems.

The post Car sharing startup RelayRides acquires Wheelz for its unlocking technology appeared first on Skift.

Read the Complete Story...

This week’s SkiftSeedlings looks at five travel startups that contribute to the inspiration and planning phases of a journey, whether it be finding the most popular places to visit via mobile check-ins or reviewing other travelers’ trips.

Get your daily dose of Skift: subscribe to our newsletter, RSS, Twitter or Facebook.

For all of our SkiftSeedlings collection, check out our archives here.

The post Five travel startups that pave the way to smarter trip planning appeared first on Skift.

Airbnb CEO Brian Chesky (center) with fellow co-founders Nathan Blecharczyk (left) and Joe Gebbia. No, they are not couch-surfing. / Airbnb

In the wake of Airbnb moving to a Verified ID system to enhance trust between hosts and prospective guests, NBCNews.com’s Ben Popken spoke with Airbnb co-founder and CEO Brian Chesky about trust and security, and what the new feature means for the evolution of Airbnb. Skift reprints the interview with permission.

NBC NEWS: How does anonymity erode trust?

CHESKY: We believe that when you remove anonymity, it brings out the best in people. It creates more accountability and gives our users more confidence when they’re booking a trip.

NBC: How do you design trust?

CHESKY: The first wave of the web was all about getting online. The second wave was about connecting online (social media, Facebook). Now, we’re on the precipice of a third wave, one that’s about taking those online connections and manifesting them in the real world. Airbnb is unique because it links online interactions with offline experiences. The ways that we build trust in our marketplace have to do the same. Verified ID is innovative because of the way it links online identity with offline identification. Imagine confirming your Facebook account when you checked in a hotel. That’s the direction we’re headed.

NBC: When you talk about trust, are you talking not just about trust between users, but also how external parties — landlords, regulators, legislators and media — trust your service and those who use it?

CHESKY: Airbnb is about access. We provide access to meaningful experiences in local places all over the world — places that weren’t easily accessible before. Trust is the currency that powers those experiences, and when you build more trust, you can provide more access. As pioneers of the sharing economy, our community expects us to innovate at a speed that matches our growth.

NBC: The last big round of trust-enhancing service additions in 2011 were reactive, borne out of crisis control. Is it fair to say that the latest move is an attempt to lock the service down more before blowing the scale out?

CHESKY: The fundamentals of trust on Airbnb have existed since the beginning of the company: our secure payment structure, detailed profiles, and authentic review system. In 2011 we added the $50,000 Host Guarantee, 24/7 Customer Service, and over 40 trust features. In 2012 we upped the Host Guarantee to $1 Million. Verified ID is the latest innovation in our ongoing commitment to trust.

NBC: Of the reservations that now require offline identity verification, what percentage have been abandoned due to incomplete ID registration?

CHESKY: The early feedback from our community has been very positive. Our team worked hard to make the Verified ID product as seamless and easy-to-use as possible.

NBC: What is your current number of 24/7 support reps?

CHESKY: We have built a dedicated Trust team that works to protect our community from fraud and build trust in the user experience.

NBC: If Verified ID is the foundation, what are the next steps, or categories of steps, towards increasing trust?

CHESKY: Trust isn’t static — it’s built over time. We’re always working to innovate new products that build trust on Airbnb. In the early days of the Web, anonymity was prevalent, but we feel the Web is moving away from that. Real identification will eventually become the standard. There is no place for anonymity in the future of Airbnb or the sharing economy.

Read the full NBCNews.com story here.

The post Airbnb CEO interview: No room for anonymity in sharing economy appeared first on Skift.

Mobile messaging apps such as WhatsApp, which handles a staggering 18 billion messages per day, are becoming a convenient alternative for travelers. / WhatsApp

WhatsAp is one of Silicon Valley’s most buzzed-about companies, yet it actively avoids the spotlight, operating out of a small office in Mountain View, Calif., with no sign on the building entrance or on the office door.

Unlike most start-ups eager for media attention, WhatsApp Inc. says it doesn’t want or need it. Its popular mobile messaging app has spread so quickly by word of mouth that in just four years it has amassed hundreds of millions of users who collectively send as many as 18 billion messages a day.

WhatsApp belongs to a new generation of messaging services that are revolutionizing 20-year-old text messaging technology and escalating the mobile messaging wars.

“In many countries, consumers have decided they prefer these mobile messaging apps,” said Tero Kuittinen, an analyst with mobile diagnostics firm Alekstra.

Now they are taking the U.S. by storm. That’s particularly worrisome to wireless carriers that have already lost billions in revenue from customers shifting from text to so-called instant messages such as Apple Inc.’s iMessage service, which each day delivers 2 billion messages free of charge.

But the growing popularity of these mobile apps is not good news for the Silicon Valley tech giants either. Analysts say people use the apps to connect with their closest friends and relatives, creating a new more intimate social network that could rival Facebook Inc. and Google Inc. for the attention of hundreds of millions of users and, eventually, advertising dollars.

Messages sent using the mobile apps, which are offered by third-party developers and downloaded to smartphones, are not limited to 160 characters the way text messages are. They also enable users to be more creative with scribbled notes, doodles and emoji pictograms that express thoughts and emotions that the typed word sometimes cannot. Some apps are adding games and other distractions to hold people’s attention even longer.

Many of the apps are free or charge a small subscription fee — WhatsApp charges $1 a year.

A challenge to Facebook

When Nick Meyer, a 22-year-old graduate student at North Carolina State University, is on his iPhone 4, he’s mostly using an app called Kik to chat with friends, he says. Each day he sends a few hundred messages, yet never messages friends on Facebook unless he’s sitting at his computer.

“Mobile is going to be the main form of communication. In some ways, it already is,” Meyer said.

With the explosion in worldwide sales of smartphones, these apps are already the go-to messaging tool in Europe and Asia, where they have taken a big bite out of texting traffic and profits that text messages generate for wireless carriers. Wireless carriers lost a total of $23 billion in texting revenue as of the end of 2012, research firm Ovum estimates.

Research firm Informa says people are now sending more messages over mobile apps such as WhatsApp than they are text messages — and the trend is accelerating. By the end of this year, traffic from mobile messaging is expected to be more than double that of traditional SMS texts. CTIA – The Wireless Assn., a wireless communications industry group, recently found that Americans sent 2.2 trillion SMS text messages last year, down 5% from 2011.

The trillions of messages from around the globe that run through WhatsApp alone each year already surpass the texting volume of all top four U.S. wireless carriers combined, telecommunications consultant Chetan Sharma said.

MessageMe, don’t text

MessageMe, a free app, launched in March. A week later it had 1 million users. Its most active users send 30,000 messages a day, the San Francisco company said.

“I didn’t know that was physically possible,” MessageMe co-founder Arjun Sethi said.

In mobile, messaging has emerged as the “killer” app, said Ted Livingston, chief executive of Kik Interactive Inc., a Canadian start-up that last month announced it had raised an additional $19.5 million in funding. Kik has 50 million users and adds 200,000 users each day, Livingston said.

Popular apps in the U.S. include WhatsApp, Kik and MessageMe. Kakao Inc.’s KakaoTalk and Tencent Holdings Ltd.’s WeChat are hot in Asian markets.

One popular Asian app is making aggressive moves into the North American market. Line, an app with which users can play games and send virtual “stickers,” reached 100 million users in 19 months. Facebook took about three times as long to reach that level.

Both Facebook and Google reportedly approached WhatsApp about a possible buyout. WhatsApp declined to comment on that but said it plans to remain independent.

Mobile messaging apps work like this: Users download the app to their smartphone and set up a personal profile. They invite friends and family members to download the app to their devices. Then they send one another elaborate messages, which travel over Internet data networks, not over cellular networks the way standard text messages do.

Jan Koum, co-founder and CEO of WhatsApp, says mobile messaging apps make communication richer by making it more personal.

“Fundamentally mobile messaging is personal and real time,” Koum said.

And more creative, says Jessica Jiang, 23, a Web graphic designer from San Jose. Jiang uses Line for the virtual stickers and MessageMe to draw pictures or to doodle on the pictures her friends send to her.

Personal expression

“I use these apps mainly for the convenience and efficiency — the way that you can stay in the same app while sending videos, iTunes music and also photos. It also gives us a personality and expression that you can’t get with just plain text,” Jiang said.

That’s a big driver behind the success of mobile messaging apps, said Dave Morin, CEO and co-founder of mobile social networking service Path.

“People desire a more expressive way to communicate with mobile phones than through basic text messaging,” Morin said.

Mobile messaging began sweeping Asia and Europe as data networks became more robust and the global economic crisis in 2008 spurred interest in cheaper alternatives. Gradually in market after market, mobile messaging began to cannibalize standard texting, analysts say. Then it started to grab time and attention away from popular messaging services from Facebook, Google and Apple too.

“The smartest, brainiest companies in the world were completely out to lunch,” Kuittinen said. “These tiny start-up companies have taken hold of the market.”

Now, he said, technology giants have made mobile messaging a top priority.

Facebook bought Beluga

In 2011, Facebook bought group messaging app Beluga and tasked the founders with building a stand-alone Messenger app for the iPhone and devices running Google’s Android software. In December, Facebook rolled out Poke, its own version of a popular messaging app called Snapchat, which lets users send messages that vanish seconds later.

Last month the giant social network made its biggest move yet, launching Facebook Home. The software takes over the user’s Android smartphone and puts the social network ahead of almost anything else on the phone’s home screen, including mobile messaging apps.

“Facebook ignored messaging for a long time until the realization sank in that some of the eyeballs are actually shifting from checking the News Feed to communications, especially in the younger demographics,” Sharma said.

Google is getting close to unsheathing its own weapon in the mobile messaging wars. It’s working on a messenger service dubbed Babel, which would work on multiple smartphone and tablet brands, so the conversation could sync across a user’s devices. Anyone with a smartphone or tablet running Android or Apple’s iOS operating system would be able to start a “hangout” to chat face to face, reports say. Google declined to comment.

MessageMe’s Sethi predicts that mobile messaging apps will eventually shove aside other forms of electronic communication and that texting, like snail mail, will become more of a utility.

“We want to be the replacement for everyday communication,” Sethi said.

jessica.guynn@latimes.com ___

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