Backed by $196 million in new financing from one of Silicon Valley”™s most prominent investors, Kayak.com Inc. is acquiring SideStep Inc., with both companies patrolling travel Web sites to dig up cheap travel tickets and reservations.
Kayak.com said the companies will maintain both Web site addresses and brands.
Santa Clara, Calif.-based SideStep reported having $22 million in revenue in 2006 to Inc. magazine, and 70 employees. Kayak.com”™s annual revenue has been estimated at $50 million; in addition to its Norwalk headquarters, it maintains an office in Concord, Mass., for its programming staff.
The combined company is the world”™s fifth-largest travel Web site, the companies said, with an estimated 33 million searches expected this month. The companies said they will have more unique monthly visitors than Kayak.com”™s Norwalk neighbor and online travel ticket pioneer Priceline.com Inc., and every airline, hotel and rental-car company with the exception of Southwest Airlines.
To date however, Priceline.com Inc. has generated more profits each quarter than Kayak.com and SideStep generate in estimated annual sales.
Still, the combined company has attracted an investor that has made big bucks on dot-com gambles before: Menlo Park, Calif.-based Sequoia Capital, an early investor in some of Silicon Valley”™s biggest successes, including Apple Inc., Cisco Systems Inc., Google Inc. and Yahoo! Inc.
Michael Moritz, a Sequoia partner who helped structure those investments, joins Kayak.com”™s board.
“Kayak.com has become the Internet”™s best destination for clear and objective travel information,” Moritz said. “Kayak.com”™s merger with SideStep.com reshapes the largest sector in online commerce.”
Kayak.com had not announced a funding tranche since May 2006, when it received $11.5 million from Accel Partners, which has offices in London and Silicon Valley.
Norwalk-based Kayak.com was founded in 1999 by CEO Steve Hafner, who before co-founding the travel site Orbitz Inc. worked for Boston Consulting Group; and Paul English, a serial entrepreneur.
“Kayak.com is a technology company focused on perfecting travel search, and SideStep.com is a media company with in-house sales expertise and user-generated content,” Hafner said. “By merging, each brand can improve its offering while continuing to focus on its individual strengths. With less than 10 percent overlap between existing Kayak.com and SideStep.com users, each site stands to gain millions of new users.”
