Hotel Engine CEO Talks Growth After $140 Million Fundraise

03.10.2024 - 21:39 / skift.com / Justin Dawes

Hotel Engine recently raised one of the year’s largest rounds of capital for a travel startup: $140 million, which valued the firm at $2.1 billion. 

The Denver-based company provides a tech platform that travel managers use to book business trips. Historically, the focus has been on hotel bookings, but flights and car rentals are joining the mix starting this month. Once that happens, the company is dropping “Hotel” from its name and will go by Engine to reflect that expanded focus. 

The company also offers hotels tech tools for bookings management, marketing, dynamic pricing, and more.

Hotel Engine is focused on small- and mid-sized companies in the U.S. Skift spoke with its founder and CEO, Elia Wallen, about what comes next.

Hotel Engine has a lot of competitors. Navan, based in New York City, most recently raised $154 million in equity at a valuation of $9.2 billion. This year, Navan hired a former New York Stock Exchange executive as its CFO ahead of an anticipated IPO. 

TravelPerk, based in Barcelona, most recently raised $104 million at a valuation of $1.4 billion.

There’s been some significant M&A activity, as well: Amex GBT earlier this year announced plans to acquire CWT for $570 million. 

All of these companies have been growing and expect to continue. But especially for small- and medium-sized companies — which is where Hotel Engine is focused — there’s still a lot of business up for grabs. 

“It’s a really big market, and there’s going to be a lot of winners and a lot of losers — you see these little companies pop up and down all the time,” Wallen said. “I think once you get to a certain scale, that there’s room for everyone, and we’re going to carve out our corner of the market.”

The Global Business Travel Association expects travel spending to exceed pre-pandemic levels of $1.4 trillion this year and exceed $2 trillion by 2028. 

Wallen said that Hotel Engine is seeing 70% growth in revenue compared to last year. And he projects “triple-digit” growth next year. The company is on track to sell about 10 million room nights this year. 

About 5% of the company’s business comes from outside the U.S. With the three product lines, the company will ramp up its effort abroad in 2025, he said.

Hotel Engine has 700 employees right now, and he expects to hire another 300-500 in the next year. 

The company raised $65 million in 2021 at a $1.3 billion valuation and raised $16 million in 2019 at a valuation of over $150 million.

Hotel Engine had spent only $20 million of that total before it raised its most recent round, Wallen said.

“All the money that we’ve raised has not just hit the balance sheet and been lit on fire, as many do.” Wallen said. “A lot of people have to keep raising money every year