HomeAway

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HomeAway.com, Inc.
Subsidiary
Industry Travel
Founded February 2005; 13 years ago (2005-02)
Founders Brian Sharples
Carl Shepherd
Headquarters Austin, Texas, United States
Key people
John Kim (President)
Trent York (CFO)
Jeff Hurst (CCO)
Tina Weyand (CPO)
John J. Ostlund (CTO)
Steve Davis (CIO)
Jeff Mosler (CSO)
Services Vacation rentals
Revenue $446.8 million (2014)[1]
Parent Expedia Group
Website www.homeaway.com

HomeAway, Inc. is a vacation rental marketplace with more than 2,000,000 vacation rentals in 190 countries listed on its website.[2][3] It operates through 50 websites in 23 languages. The company offers rentals for families and groups in cabins, condos, castles, villas, barns and farm houses.[4][5] Founded in February 2005 and headquartered in Austin, the company became a publicly traded company in 2011.[6] Expedia Inc. acquired HomeAway on December 15, 2015.

History[edit]

HomeAway, Inc. was founded in 2004 as CEH Holdings.[7] The company acquired several sites and consolidated them into a single vacation marketplace, launching HomeAway.com in June 2006.[8]

HomeAway moved into its new global headquarters in Austin, Texas on October 2, 2009; it was the first mixed-use project and the second company in Austin to achieve LEED Gold certification for Commercial Interior Design.[9]

In 2009, Us Weekly magazine announced that HomeAway would reunite actors Chevy Chase and Beverly D’Angelo in a new short film and advertising campaign based on National Lampoon’s Vacation (a movie). The HomeAway ad represents the company’s first national advertising campaign. It debuted during the CBS television network broadcast of Super Bowl XLIV on February 7, 2010.[10]

HomeAway raised a total of $405 million in venture-capital which was funded by venture capital firms Austin Ventures, Institutional Venture Partners, Redpoint Ventures, Technology Crossover Ventures and Trident Capital.[11] Homeaway’s IPO stock closed at $40.21 on Nasdaq, up 48.9% from its IPO price of $27.

A summary of the company's financial information over four years:

Year Revenue Percentage Increase
2011 $230.2m -[12]
2012 $280.4m 21.8%[13]
2013 $346.5m 23.6%[14]
2014 $446.8m 28.9%[1]

A federal lawsuit accuses Austin-based vacation rental company HomeAway Inc. of engaging in “bait and switch tactics” after it rolled out new service fees for customers booking vacation rentals.

Those fees “range from 4 percent to 10 percent of the total price of the vacation rental,” according to the suit filed this week in U.S. District Court in Austin. The suit claims the new fees are substantially increasing prices paid by consumers and dramatically changing the business model HomeAway and its sister sites, such as VRBO, were built upon.[15]

Acquisitions[edit]

Acquisitions made by HomeAway have included:

Date Acquisition Location
2005 CyberRentals.com U.S.
2005 GreatRentals.com U.S.
2005 A1Vacations.com U.S.
2005 TripHomes.com U.S.
2005 HomeAway.co.uk United Kingdom
2005 FeWo-direkt.de Germany
2006 VRBO.com[16] U.S.
2007 Abritel.fr[17] France
2007 VacationRentals.com[18] U.S.
2007 OwnersDirect.co.uk[19] United Kingdom
2009 Homelidays.com[20] France
2010 HomeAway.it Italy
2010 BedandBreakfast.com[21] U.S.
2010 AlugueTemporada.com.br[22] Brazil
2010 Instant Software [23] US
2010 Escapia [24] US
2011 RealHolidays.com.au[25] Australia
2012 Toprural.com[26] Spain
2013 Travelmob[27] Singapore
2013 Stayz Australia[28] Australia
2013 Bookabach.co.nz[29] New Zealand
2014 Glad to Have You, Inc.[30] U.S.
2015 Dwellable[31] U.S.

One of these acquisitions, 'Dwellable' was a mobile app and website founded in 2012 and headquartered in Seattle, Washington.[32] By 2014 Dwellable had over 300,000 vacation rental listings,[33][34] and had raised $2 million in venture funding.[35] The company remained in private ownership,[36][37] until it was bought by HomeAway in 2015 for $18 million.[38][39]

Business model[edit]

Before HomeAway introduced its new optional performance-based business model in 2013, homeowners paid subscription fees which averaged out to be $442 annually, to list their own property or display their vacation rentals on the company’s sites.[40] To promote the vacation rentals, property owners and managers could purchase paid listings on one or more of the company's websites as a form of advertising to potential travelers. Paid listings appear in search results when travelers search for vacation rentals, based on their search criteria. The new performance-based model represented a second option for those wishing to list a home on HomeAway, who could still opt for the original annual subscription model.

In 2016, HomeAway introduced a controversial service fee to be paid by travelers booking through the HomeAway websites. The service fee currently ranges from six to twelve percent of the total amount for most reservations (excluding taxes and refundable fees), but can be above or below that rate depending on the reservation. Generally, the higher the reservation amount, the lower the percentage of service fee. [41]

The company claims the service fee for travelers covers the cost of providing 24/7 customer support, enhanced site and mobile features, plus expanded marketing efforts to generate more exposure to global audiences. Along with the introduction of the new service fee, HomeAway instituted their Book with Confidence Guarantee for travelers who opt to book and pay directly through the HomeAway platform. [42]

Also in 2016, the company eliminated its tiered subscription model, whereby owners and property managers would have to pay more for preferred placement within the search results. Now only a basic annual subscription model is offered as an alternative to the pay-per-booking option, in which owners must pay from five to ten percent of the quoted total rental fee as the cost for each booking. [43] [44]

HomeAway also introduced a Professional Referral Network of 40 partner companies. The network’s members assist vacation rental owners in managing their listings, guest inquiries and reservations, and include Evolve Vacation Rental Network, Southern California Vacation Rentals and No Worries Vacation Rentals.

Financing[edit]

HomeAway announced in November 2006 its $160 million in financing to fund global expansion initiatives, including the acquisition of VRBO.com (Vacation Rentals by Owner).[11] On November 11, 2008, HomeAway announced it had completed an additional $250 million equity capital raise.[45] The investment was led by Technology Crossover Ventures (TCV) and with existing investors Austin Ventures, Institutional Venture Partners (IVP) and Redpoint Ventures.[46] In 2010, the Wall Street Journal named HomeAway one of the top 10 venture funded companies.[47]

Legal status[edit]

HomeAway has had disputes over compliance with local lodging regulations, similar to competitor Airbnb. Both joined a lawsuit against the city of San Francisco, which was settled in May 2017 when the companies agreed to facilitate registration of all host listings with the city.[48]

References[edit]

  1. ^ a b "HomeAway, Inc. Reports Third Quarter 2014 Financial Results", Financial Report 2014, Retrieved April 11, 2015
  2. ^ "About HomeAway". 
  3. ^ "HomeAway: How it Works". 
  4. ^ "Priceline Could Get Bigger In Vacation Rentals By Acquiring HomeAway". 
  5. ^ "HomeAway.com listings for cabins, condos, castles, villas, barns and farmhouses". 
  6. ^ "HomeAway IPO Prices At $27/Share; Valued At $2.2B". 
  7. ^ "homeaway inc (AWAY) Details". Retrieved Jul 26, 2013. 
  8. ^ Austin Business Journal. "Live the destination: Local company launches vacation rental Web site", Austin Business Journal, June 7, 2006.
  9. ^ Austin Business Journal."HomeAway HQ nabs LEED gold rating", Austin Business Journal, April 15, 2010.
  10. ^ US Weekly. "Exclusive: Chevy Chase, Beverly D'Angelo to Reprise Vacation Roles", US Weekly, November 18, 2009.
  11. ^ a b Nuttall, Chris. "HomeAway makes $250m VC round splash", FinancialTimes.com, November 11, 2008.
  12. ^ "HomeAway, Inc. Reports Fourth Quarter and 2011 Financial Results", Financial Report 2011, Retrieved April 11, 2015
  13. ^ "HomeAway, Inc. Reports Fourth Quarter and Full Year 2012 Financial Results", Financial Report 2012, Retrieved April 11, 2015
  14. ^ "HomeAway, Inc. Reports Fourth Quarter and Full Year 2013 Financial Results", Financial Report 2013, Retrieved April 11, 2015
  15. ^ http://rentmoreweeks.com/2016/03/19/new-fees-from-austin-based-homeaway-are-bait-and-switch/
  16. ^ Austin Business Journal."Vacation rental site lands $160M, buys competitor", Austin Business Journal November 13, 2006.
  17. ^ *Austin Business Journal."HomeAway buys French Web site", Austin Business Journal January 22, 2007.
  18. ^ Austin Business Journal."HomeAway continues buying spree", Austin Business Journal May 14, 2007.
  19. ^ Austin Business Journal."HomeAway continues buying streak with UK-based acquisition", Austin Business Journal October 2, 2007.
  20. ^ Austin Business Journal."HomeAway picks up Homelidays SAS of Paris", Austin Business Journal February 4, 2009.
  21. ^ Travel Weekly."HomeAway buys B&B website", Jerry Limone March 3, 2010.
  22. ^ TechCrunch."HomeAway Expands To South America With Purchase Of Brazilian Counterpart", Robin Wauters March 9, 2010.
  23. ^ "HomeAway Acquires Largest Vacation Rental Management Software Provider—Instant Software, Inc."
  24. ^ *HomeAway
  25. ^ TechCrunch."HomeAway Broadens Presence In Australia With Acquisition Of Vacation Rental Site RealHolidays", Leena Rao April 4, 2011.
  26. ^ TheNextWeb."HomeAway acquires Spain’s rural tourism site Toprural in all-cash deal", The Next Web April 2, 2012.
  27. ^ TechCrunch."HomeAway Buys Singapore Startup Travelmob To Enter Asia-Pacific", Victoria Ho July 17, 2013.
  28. ^ Market Watch."HomeAway Acquires Australia's Leading Vacation Rental Group, Stayz", December 4, 2013.
  29. ^ "Company Information". HomeAway. Retrieved 7 April 2015. 
  30. ^ "Glad to Have You, Inc.: Private Company Information - Businessweek". Bloomberg. Retrieved 7 April 2015. 
  31. ^ "HomeAway buys vacation rental startup Dwellable, plans to shutter service and move team to Austin". GeekWire. 2015-10-07. Retrieved 2017-01-13. 
  32. ^ Greenfield, Beth (15 March 2012). "Dwellable's Vacation Rental Site: Hot Travel App For The iPad 3". Forbes. Retrieved 13 January 2015. 
  33. ^ Cook, John (10 June 2014). "Bootstrapping vacation rentals startup Dwellable raises $2M from Seattle angels". GeekWire. Retrieved 15 March 2015. 
  34. ^ Winfield, Kirby (23 October 2013). "Mobile Vacation Rental Service Dwellable on Track for $10M Bookings in 2013, Expands Internationally". Reuters. Retrieved 16 March 2015. 
  35. ^ Mandel, Glenn (10 June 2014). "Dwellable, World's #1 Rated Mobile App for Vacation Rentals, Raises $2 Million in Funding". Business Wire. Retrieved 17 March 2015. 
  36. ^ Skillman, Alex (10 June 2014). "Dwellable Raises $2 Million in Funding, Funds to be Used to Continue Rapid Pace of Innovation; Financing Led by Version One Ventures and Maveron". Reuters. Retrieved 15 March 2015. 
  37. ^ Vivion, Nick (9 June 2014). "Dwellable raises $2 million to expand mobile app for vacation rentals". tnooz. Retrieved 16 March 2015. 
  38. ^ "HomeAway buys vacation rental startup Dwellable, plans to shutter service and move team to Austin". GeekWire. 2015-10-07. Retrieved 2017-01-13. 
  39. ^ https://www.tnooz.com/article/in-an-acqui-hire-homeaway-nabs-dwellable-the-mobile-app-for-vacation-rentals/
  40. ^ "Why This Could Be HomeAway's Breakout Quarter". Seeking Alpha. Retrieved 7 April 2015. 
  41. ^ "How does the service fee work? | HomeAway Help". help.homeaway.com. Retrieved 2018-03-05. 
  42. ^ "Whats the Deal with HomeAways New Booking Fee". Elliott. Retrieved 23 February 2016. 
  43. ^ "HomeAway dramatically revamps subscription pricing for US owners". Tnooz. Retrieved 28 April 2016. 
  44. ^ "How is the pay-per-booking fee calculated? | HomeAway Help". help.homeaway.com. Retrieved 2018-03-05. 
  45. ^ "Some Startups Still Lure Investors", BusinessWeek.com.
  46. ^ Ante, Spencer. "HomeAway: A Find in Online Vacation Rentals", BusinessWeek Online, November 11, 2008.
  47. ^ DEBAISE, Colleen and Austin, Scott. "Sizing Up Promising Young Firms ", Wall Street Journal, March 9, 2010.
  48. ^ http://www.sfgate.com/business/article/Airbnb-settles-SF-suit-agrees-to-register-all-11112109.php#photo-10763720

External links[edit]