One ripple effect of startups like Airbnb raising enormous sums of funding is that it has become harder for smaller rivals to clone their models elsewhere in the world. While clones get a bad name, they do provide benefits to consumers in added competition.
Wimdu, which had been Europe’s most well-funded clone of short-term rental search company Airbnb with 400 employees at its peak, will close by the end of the year, according to a message the company sent to partners Thursday. It cited “significant financial and business challenges” as the explanation.
The company did not respond to comments in time for publication. It will lay off its staff of about 50 employees in Berlin and about 60 in Lisbon by the year’s end, Gründerszene reported.
Wimdu had received a total of more than $90 million in funding, primarily from Rocket Internet and AB Kinnevik.
At the start of 2017, Novasol, a Denmark-based vacation-home marketer owned by the European Vacation Rentals unit of Wyndham Worldwide, was cleared to take ownership of the company. Novasol attempted to make Wimdu profitable by laying off about 25 employees and retooling its online marketing.
The private equity firm appears to be making changes to the business portfolio.
In a statement, Wimdu said, “All guests and hosts having 2018 bookings – with a check-in date occurring before or on the 31-December-2018 – will be carried out professionally and reliably. All guests with 2019 bookings – with a check-in date occurring after the 31-December-2018 – will be contacted separately to deal with their respective booking.”
The news strengthens the position of HomeToGo, a price-comparison search engine based in Berlin. In 2017, HomeToGo raised a Series C round. The company declined to disclose the amount but said it was “a significant eight-figure number.” Before that, it had raised $26.6 million in funding.
While HomeToGo is a price-comparison aggregator, unlike Wimdu, it is now Europe’s largest, best-funded, profitable, and fastest growing startups in the vacation rental search segments.
In related news, one-time main Wimdu backer Rocket Internet appears to be pulling back from several investments. appears to be pulling back from some of its investments. There have been reports it’s considering putting one of its portfolio companies Jumia — an African consortium of internet companies including a travel brand Jumia Travel — on the public markets via an initial public offering, Reuters reported.
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Photo credit: An apartment in the Garden Hills neighborhood of Atlanta, Georgia, that was available on Wimdu, a vacation rental search brand that will shutter later this year. Wimdu