Sequoia backs Skyscanner

Ellie Pullen
03 October 2013

Tweet
Facebook
LinkedIn
Google plus
Send to

Sequoia Capital has invested in Skyscanner, a Scottish travel search engine, in a deal that values the company at $800m.

The investment from Sequoia comes in the form of replacement capital, although it is believed that existing Skyscanner investor Scottish Equity Partners (SEP) did not sell any of its stake in the company to Sequoia.

The investment by Sequoia is one of the largest the US-based venture capital firm has ever made in a company, according to Skyscanner. However, the company also stated that SEP will remain as Skyscanner's largest shareholder following the transaction, continuing to hold a 40% stake in the business.

Skyscanner plans on using the funds to double its workforce to approximately 500 staff, a process it started in August. The company claims to have experienced 100% year-on-year growth over the past four years.

Previous funding
In November 2007, SEP injected £2.5m into Skyscanner. Overall, the firm has invested £9m in the company over a series of funding rounds.

Company
Founded in 2001, Skyscanner is headquartered in Edinburgh with additional offices in Glasgow, Singapore, Beijing and a recently opened office in Miami. The company employs around 300 staff and saw turnover of £33.5m in 2012, a 63% increase from 2011, as well as an EBITDA of £12m – a 153% increase from the previous year.

Skyscanner provides online comparisons for flights, hotels and car hire. The company operates a set of websites as well as a mobile application that is available in 30 languages. Skyscanner claims to have more than 25 million visitors per month to its website, as well as 25 million downloads of its app.

The company's services are free to use, and Skyscanner makes its money by earning referral fees from its travel partners when a Skyscanner user books a service through the website or app, which takes a user directly to the service provider. Skyscanner generated £2.3bn in travel bookings for its airline partners in 2012.

People
Gareth Williams is the CEO and founder of Skyscanner. Michael Moritz is the chairman of Sequoia and will join Skyscanner's board of directors. SEP managing partner Calum Paterson resides on the company's board as a non-executive director.