The price of the sale, which was an equity transaction, was not disclosed by either party. Recruit Holdings has invested in a variety of companies across various sectors, recently in autonomous delivery company Savioke and restaurant iPad point-of-sale software provider TouchBistro.
They also own job-search giant Indeed.com, several online restaurant reservation platforms, and various travel booking sites serving markets in Asia. They’ve invested in vacation rental site Tripping as well.
TrustYou, which was founded in 2008, collects verified reviews and survey results for hotels and online travel providers to provide insights on guest satisfaction and other factors to travel brands. It offers several different products including TrustYou Meta-Review, which summarizes reviews for hotels and provides vetted scores for display on online travel agencies, along with real-time messaging services through TrustYou Messaging.
Recruit Holdings wrote in its 2016 annual report that it aims to be a world-class provider of human relations and marketing services by 2030, making TrustYou a good fit with its primary mission.
TrustYou works with hotel brands including Accorhotels, Best Western, and Mövenpick Hotels & Resorts. It also partners with online travel companies like Google, Kayak, Sabre, and Skyscanner. The company previously raised $5 million in four funding rounds, according to Crunchbase, and was looking into another round late last year.
“We started the fundraising process in November 2016, that was the kickoff; we were talking to various parties from private equity to venture capital and strategic partners,” said Ben Jost, CEO of TrustYou. “There was a lot of interest to partner with us and we were looking for someone to let us run as independently possible, but also finance the company with the necessary long-term vision and depth.”
Jost and chief operating officer Jakob Riegger, the two co-founders of the company, will continue to run TrustYou going forward.
TrustYou itself acquired messaging platform Checkmate for an undisclosed price last summer. Jost said more small-scale acquisitions could come in the near future.
“We’re going to be very opportunistic so for sure we’re going to grow organically and invest in areas where there is organic growth,” said Jost. “We want to own the space we’re in today, the whole guest feedback play, we want to own that and from there even if there are other opportunities, we’re not going to do anything else but hospitality and travel software-as-a-service. We’re not going to become an [online travel agency].
“For clients, it’s great news too because we had limited funds in the past. The nature of our business is that we grew the company organically instead of taking tens of millions in funding; in the last nine years we only took $5 million. For our customers and partners, that will be great news because we can be faster in product development and serve them more globally.”
The company is seeing strong growth in both Asia and the U.S., according to Jost.
The acquisition takes place with a greater upheaval going on in the user-generated reviews space, with both smaller players like TrustYou and giants like Expedia and Google creating innovative new solutions. TripAdvisor, which popularized user-generated reviews, still holds a competitive advantage in the space, even if companies like TrustYou add their own special sauce to help brands get more out of the reviews.
“Trip also gave birth to the user-generated review as the go-to content format used to promote travel brands,” Skift wrote in our recent Deep Dive Into TripAdvisor’s Competitive Advantage in Travel report. “Now, the big platforms have followed suit. Google is a direct competitive threat for just about every online travel brand. For Trip, Google content and its positioning relative to Trip’s content is a concern. As a mid-sized company, Trip has made some big decisions about its core business model. And while we worry about its tolerance for additional pivots, we also think that Trip has now laid out a clear monetization strategy. With the strategic aspects more settled, the company can focus on incremental improvement and promotion.”
Jost thinks there is still some tension between hotels and online booking sites that will shake out in coming years.
“It’s going to be interesting to see how it plays out that [online booking sites] are all moving toward hotel services,” said Jost. “It’s going to be interesting if hotels adopt those [platforms] or move away from them. The trend they’re all talking about is moving away from these channels and doing their own thing.”