Skift Take

With Lola's acquisition of Room 77's metasearch tech, Room 77 essentially becomes a consumer insights and hotel search test lab for Lola. Room 77's original founders have essentially exited the business: Google licensed its tech and hired the bulk of its employees, Expedia acquired Room 77's pioneering room-view tech, TrustYou bought Room 77's Checkmate hotel-messaging app, and now Lola picked up the remaining technology.

Paul English, the co-founder of metasearch company Kayak and currently co-founder and CEO of travel agent app Lola, said his company has acquired hotel metasearch site Room 77’s technology.

In a Medium post, English said Lola will keep Room 77 operating and he thinks “the platform will also provide strategic insights for helping Lola deliver the best hotel deals through the best channel for our customers.”

Founded in 2010 and faced with the challenge of competing against Paul English’s Kayak, Google and others, Room 77 had become a skeleton of its former self since 2014 when it entered into a technology licensing deal with Google and the bulk of Room 77’s workforce then moved over to Google. Room 77 shifted its focus to its Checkmate hotel-messaging services business and TrustYou acquired Checkmate in July 2016.

Lola To Use Room 77 Meta Tech, Expedia Bought Room View Tech

Room 77 debuted in 2010 and pioneered letting consumers view the actual room they could possibly be booking.

The Lola-Room 77 deal, though, just involves Lola acquiring Room 77’s tech/metasearch assets. Skift has learned — and it hasn’t been reported until now — that Expedia, which led a Room 77 funding round in 2013, previously acquired Room 77’s room-view technology.

Google is no longer licensing Room 77 technology.

English tells Skift that Lola was interested in Room 77’s metasearch technology but not the tech that enabled consumers to scope out the view of specific hotel rooms

“I didn’t care about room view since consumers never really went for that to Room 77,” English said. “I care deeply about their metasearch engine, which searches hotel prices and info across dozens of sites.”

He added: “My machine learning team has been all over the Room 77 datasets and I’m confident that data will improve our hotel recommendation engine.”

The Lola-Room 77 tech acquisition couldn’t have involved a massive sum. Lola, itself a startup, has raised $19.5 million in venture funding and only launched its first product, an app that enables consumers to plan their trips with travel agents via chat, earlier this year. The two parties did not disclose the terms of the deal, although Room 77 CEO Drew Patterson confirmed that “of course” money did indeed change hands.

Lola’s Plans

Lola CMO Robert Birge says the company plans to keep running as a viable site with an adequate consumer experience but will not be investing to expand Room 77’s market presence. Lola plans to keep operating Room 77’s apps, as well, and they will remain a separate experience from the Lola trip-planning app.

The idea is to use Room 77 as a foundation for gaining greater insights into consumer behavior and hotel search. If there don’t continue to be adequate insights to help Lola build its business, then Lola would shut down Room 77, Birge said, although he believes the site will continue to provide learnings to Lola.

Birge said Room 77’s metasearch technology was unique in that it aggregated content from online travel agencies and hotels, but it also grabbed hotel content from global distribution systems.

“We’re creating a better way for people to find and book the right hotel, flight and other travel,” said Krista Pappas, Lola’s vice president of business development and distribution. “We have a lot of admiration for the Room 77 team for their innovations in hotel search, and are excited to add the technology and platform to Lola’s development.”

“The platform will also provide strategic insights for helping Lola deliver the best hotel deals through the best channel for our customers,” Pappas said.

Small World

Beyond the merits of the deal, the acquisition highlights how a tight circle of investors and founders continue to do deals with one another. For example, Patterson was VP of marketing at Kayak, which English co-founded. In addition, Room 77 founder Brad Gerstner worked years ago for General Catalyst, which funded English’s Kayak, Lola, and Room 77.

Meanwhile, Expedia led a funding round of Gerstner’s Room 77, acquired its room-view technology, and acquired photo-app Trover, which saw Expedia founder Rich Barton as Trover chairman and Gerstner as a Trover investor and advisor.

As we pointed out earlier:


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Tags: apps, expedia, lola, mergers and acquisitions, metasearch, room 77, travel agents

Photo credit: The travel agent app Lola has just acquired hotel metasearch site Room 77's tech.

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