Skyscanner has more or less been a bootstrapper in metasearch, growing mostly organically and profitably for the last seven years. But its challenge has been how to get to the next level. It's unclear how much of a difference this latest funding round will make since a chunk of it will be used as a payout to existing investors.
Skyscanner, the Scotland-based flight-metasearch site, states it picked up $192 million in “primary and secondary” investments from five investors.
The Financial Times reports that the investment, part of which will be used to buy out some of the positions of existing investors, values Skyscanner at $1.6 billion. That would be double its $800 million valuation from 2013, when Sequoia Capital bought out some previous investors.
The “primary” portion of the investment, Skyscanner states, will be used to accelerate its expansion, including acquisitions.
The five new investors include Khazanah National Berhad, which is the sovereign wealth fund of the Government of Malaysia and an investor in Malaysia Airlines and Malaysia Airports. The others are global fund manager Artemis; Edinburgh-based investor Baillie Gifford; Vitruvian Partners, a European venture capital firm, and Yahoo Japan, which is already a venture partner in Skyscanner Japan.
Founded in 2003, Skyscanner had only previously raised aound $6.5 million. Existing investors Scottish Equity Partners and Sequoia Capital did not participate in the latest round. Skyscanner would not detail who led the round, what stake in the company the new investors now have, and what portion was a primary investment.
Skyscanner CEO Gareth Williams says the company has been profitable since 2009 and “has enjoyed double-digit growth rates for some years now.”
The Financial Times reported that Skyscanner’s most recently reported revenue was around $135 million in 2014, which was a 42 percent increase over the prior year but a deceleration from doubling its revenue in 2013.
Skyscanner offers hotels and cars in addition to flights but its primary revenue comes from selling airline tickets. Like other metasearch sites, Skyscanner is starting to take direct bookings on its sites, which are available in 30 languages. It currently has more than 700 employees in 10 global offices, and is focused on expanding its base in locales such as China, Japan and the Americas.
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Photo credit: Skyscanner will use a new funding round to provide liquidity to existing investors as well as to expand internationally. Skyscanner