TripActions raises $155M at $5B valuation as company journey recovers from pandemic lows – TechCrunch
This morning TripActions, a software company whose tools help companies book and manage business travel, announced a new investment of $ 155 million.
Three investors led the way: former investor Andreessen Horowitz, Addition Ventures and Elad Gil. The new investment, a Series E, is valued by TripActions at $ 5 billion on the money, a company spokesperson wrote via email.
Rating marks are usually only moderately useful, but in the case of the final round of TripActions, they carry more weight.
The company – along with restaurant software Unicorn Toast – has become a figurehead for the impact COVID-19 is having on some categories of startups. TechCrunch covered the launch of a new $ 500 million credit facility for a TripActions product called Liquid in late February 2020. A month later, in late March, TripActions laid off hundreds of employees when the travel market froze.
For a company that raised $ 250 million at a valuation of $ 4 billion in mid-2019, it was a dramatic reversal in assets. (TripActions raised an additional $ 125 million for convertible-to-IPO financing last June when the travel market was particularly bleak.)
Today, however, investors are betting on the company’s assets by not only providing it with another nine-digit capital sum, but also giving it a new, bigger valuation.
Catching up less than a year after layoffs is a formidable recovery. So TechCrunch wanted to learn more about the business travel market, the bread and butter of TripActions, and the pace of recovery from the venerable business trip. How quickly do employees get back on planes with the introduction of COVID-19 vaccines?
According to a company spokesman, the business travel market will be “20 percent” this month, while it will grow between 3% and 6% “week after week”. This pace of recovery could have given investors confidence that the recovery of TripActions, at least for much of its former strength, was only a matter of time.
TechCrunch also asked TripActions what the corporate travel market will look like in the zoom-enabled hybrid work environment that has been anticipated by many. A spokesperson wrote that the company has “strong” beliefs that business travel may “not return 100 percent immediately,” but 75% “within the next year.”
The spokesman also wrote that a more dispersed workforce could actually encourage business travel. If so, TripActions could end up in a stronger position after COVID than it could possibly have done if the pandemic had never happened. For a unicorn forced to lay off so many workers when its market temporarily disappeared, such a return to power would be a coup.
Back to the round, TripActions intends to use the new funds to invest in its product. The company highlighted recent feature releases in an email to TechCrunch to underline the point, including software integrations, and added that it intends to continue working on its finance-focused Liquid product.
The spokesman also said the company will “develop functions on the travel site to make it easier for distributed teams to meet face-to-face.” Since many assume that the days of completely geographically-centric companies are over, the decision makes sense.
TechCrunch asked what part of its previously laid-off workforce has been reinstated to date and whether the new funds will be used to hire employees who were laid off last year. We’ll update the piece when we hear something.
Regardless, from pre-pandemic highs to a COVID-19 low to today with a newly elevated rating and lots of new cash, TripActions has a future business case study in preparation for the final year.