Tag: Homeaway

HomeAway’s Brian Sharples’ Entrepreneurial Journey

By LAURA LOREK
Reporter with Silicon Hills News

Brian Sharples, courtesy photo from HomeAway

Brian Sharples, courtesy photo from HomeAway

As a serial entrepreneur, Brian Sharples, co-founder of HomeAway, has learned many lessons on his entrepreneurial journey.

He recounted several of them with Bob Metcalfe, professor of innovation at the University of Texas last week. Metcalfe interviewed Sharples, CEO of HomeAway at the Longhorn Startup Demo Day.

HomeAway has 1,900 employees worldwide, including about 1,000 in Austin in five locations. The company lists more than 1 million vacation rental homes in 190 countries. It went public in 2011 and has a market capitalization of $2.8 billion and its stock, listed as AWAY on the Nasdaq Stock Exchange, currently trades for around $30.50 a share.

The Early Years

First off, Metcalfe asked Sharples if he had a lemonade stand or paper route and to talk about his early entrepreneurial roots.

Sharples said he had done all of those things. And his entrepreneurial instincts came from his dad, who was an entrepreneur, electrical engineer and a pioneer in analog to digital conversion. He invented a digital panel meter. His invention is in the Smithsonian.

“He worked for himself, he didn’t have bosses, he had employees,” Sharples said.

Sharples grew up in an entrepreneurial environment in a suburb of Boston called Braintree. His family had a vacation house in Maine. He ended up attending Colby College in Maine and later got accepted to Stanford’s business school.

Grappling with Failure

Bob Metcalfe and Brian Sharples at Longhorn Demo Day

Bob Metcalfe and Brian Sharples at Longhorn Demo Day

Metcalfe asked Sharples about his biggest entrepreneurial failure.

Sharples, at 27, raised $1 million from Kohlberg Kravis Roberts
Venture Capital Fund to create a marketplace for selling used autos. He rented out Candlestick Park in San Francisco and built a huge auto sales event for thousands of people.

“It was like a rock concert for buying cars,” Sharples said.

He bet all of his money on that first event. On a Saturday, they opened the doors and by 11 a.m. a freak storm with 85 mile per hour winds blew in and destroyed the place.

“It turned from a beautiful event one minute to how do we make sure no one gets killed,” Sharples said. “People got hurt but no one got seriously injured.”

Eventually, Sharples created iMotors, a derivative of that business, and ultimately raised $120 million and was doing $25 million in revenue by 1999. But when the dot com crash happened they couldn’t sustain the business. They ended up selling the assets for $85 million to AutoNation.

Moving to Austin

So Sharples decided to get out of the auto business. He moved to Austin and got involved with IntelliQuest, an 11-employee company providing Dell with market research information. Sharples got to know the founder really well. He ended up cutting a deal where Austin Ventures and Sharples each took a third of the company. They took the company public in 1996 and Sharples ran it for four years.

“One of the things I learned from that experience is it’s really nice to have a partner,” Sharples said.

In entrepreneurship, a lot of people associate that with being the lone wolf, Sharples said. But it’s a lot more powerful if you have a partner, he said. So when Sharples decided to launch HomeAway he wanted a partner and Austin Ventures introduced him to Carl Shepherd, a merger and acquisition expert who became co-founder of HomeAway.

In 2005, Sharples and Shepherd created HomeAway, then known as WVR, a global vacation home business. The idea was to create the Expedia of vacation rentals and to acquire great businesses around the world. Raised $405 million and did 22 acquisitions in total, Sharples said.

“HomeAway took a great deal of money to create,” Sharples said. And to get that kind of money, an entrepreneur has to have a track record of success and returning money to investors, he said.

The IntelliQuest Initial Public Offering and later sale to WPP Group made about a 25 times return on Austin Ventures investment, Sharples said.

“Once you’ve succeeded like that for investors, investors like to back people who have done it before,” he said.

Founding HomeAway

Austin Ventures agreed to back HomeAway for $50 million initially and they issued a press release saying they had given Sharples $50 million for a new venture. That check made people listen to them, Sharples said.

Sharples and Shepherd hired McGarrah Jessee, an Austin-based Ad Agency, to come up with the name HomeAway. The owner of the website domain name ended up being an RV park owner in the United Kingdom. They were able to negotiate with him and buy it, Sharples said.

Originally Sharples thought they would buy vacation properties around the world and rent them to club members. But through his research, he found there were 7 million homes alone in Europe for rent. It was a much bigger market. So they decided to build a platform and make the properties available to book online.

Before doing the platform, Sharples and Shepherd spent four months doing research on the project. They found out Expedia paid $73 million for a company that had the same model as HomeAway and a year later it was gone. So he met with Rich Barton, the CEO of Expedia, in Seattle and he took them through the entire deal. Expedia tried to turn the business into a hotel business. The homeowners viewed their homes as their personal property and they wanted to talk to people and they didn’t want to do everything online. The conversation was critical.

Within the next two years, everyone in the HomeAway marketplace will become online bookable, Sharples said. The marketplace has changed. It wouldn’t have worked ten years ago, or even five years ago, but it works now, he said.

Thinking About Worst Case Scenarios

Bob Metcalfe at Longhorn Startup Demo Day

Bob Metcalfe at Longhorn Startup Demo Day

Metcalfe pointed out that the Longhorn Startup class instructors teach their students to fail fast. But Sharples, he said, studies others who have failed and seeks to avoid the failure altogether.

Because of his first failure in the auto business, Sharples said he became paranoid and studied all the things that could go wrong in his next ventures.

He advised other startup entrepreneurs to study others, study worst case scenarios and think about risk.

“People spend so much time in their pitches on how everything could go right, they need to devote a little more time and scenario planning on how they could go wrong,” Sharples said.

For example, HomeAway bought Vacationhomes.com in the U.S. for $40 million just to prevent a competitor from buying it, Sharples said.

“We don’t just study failures of other companies, which we did in the early days, but we calculate all the ways we could fail and we try to prevent them,” Sharples said.

Sharples favorite recruiting question is to ask job candidates to talk about something they’ve failed about in their life. And the second question he asks is what did they learn from it.

He also looks for humility in his employees.

“I just don’t have the patience for ego,” Sharples said. “I think it sets up a horrible dynamic within a company when people are operating for personal gain or personal showboating. I’m all for being super competitive. But within a team, you can’t be super competitive. Building a company is a team sport.”

The introduction song for Sharples when he entered the stage was Rusted Root’s “Send Me on My Way,” which he says they may use in their next commercial campaign because it sounds like HomeAway.

12 Austin Companies Make Deloitte’s Technology Fast 500 List

us_tmtf500Twelve Austin companies made Deloitte’s annual Technology Fast 500 list, up from eight companies last year.

Deloitte ranks the fastest growing private and public companies in the technology industry. Five of the companies made the list last year and again made the list this year including Kinnser Software, 181, Bazaarvoice, 186, SailPoint, 233, HomeAway, 404 and SolarWinds, 405.

Phunware ranked highest on the list at the number four spot growing at 17,716 percent from last year, according to Deloitte. Q1 Media hit the list at 69th spot. And One Source Networks ranked at 160.

Others on the list included Cirrus Logic at 266, Zenoss at 299, Asure Software at 459 and Starmount at 498.

The full list can be found at Fast500.com.

Entrepreneur Magazine: “What it Means to Be An Entrepreneur”

Hat tip to Julie Huls, president of the Austin Technology Council, for sharing this Entrepreneur Magazine video featuring local entrepreneurs Brain Sharples, founder of HomeAway and Kim Overton, founder of SPIbelt.

It’s a reminder to us all that we can change the world through entrepreneurship.

“It is our nature to explore,” according to the video. “To go places no one has ever dreamed. To redefine what is possible. It is our calling to create. To transform the world around us. To plant the seeds of change. It is our responsibility to disrupt. To laugh in the fact of conformity. To create our own reality. It is our duty to lead. To show strength when others are weak. To trust ourselves when everyone doubts. We are the brave souls that are changing our culture, our economy, and redrawing the lines of the future. We are the entrepreneurs. And our greatest rewards have yet to come.”

British Airways Dreamliner: The Wellness Plane

By SUSAN LAHEY
Reporter with Silicon Hills News

Jon Driscoll with Mass Relevance, Virginia Miracle with  Spredfast and Matt Curtis with HomeAway.

Jon Driscoll with Mass Relevance, Virginia Miracle with Spredfast and Matt Curtis with HomeAway.

The British Airways direct flight that just started its inaugural journeys back and forth from London to Austin isn’t your average plane ride. It has been calibrated to reduce jetlag. For example, the lighting is different from other planes. The air pressure was set for 6,000 feet rather than 8,000 feet which is supposed to reduce dryness and other stressors on the body. And the windows are much larger to connect passengers to the flying experience. Instead of passengers pulling down blinds, they can adjust the amount of light coming in electronically.

The point, said Glenn Morgan, head of service transformation for British Airways, is to “create a whole wellness experience, getting passengers there in the best shape they can be.”

Open Platform

And they’re only beginning.

“We’ve opened up the platform for APIs,” said Morgan. “A lot of companies are doing great things in the travel space, hotel finders, transportation, putting that information together. We work a lot in the valley, and we were talking to a company very much like Capital Factory and they said I bet you have no single business problem that a startup isn’t working on right now. And he’s right.”

The Boeing 787 Dreamliner’s body is made of carbon fibers rather than metal, wrapped and then baked in an autoclave until it is a very hard substance. It goes in the oven looking like a cone made of roofing asphalt and emerges shiny. The lighter substance allows for 20 percent reduction in fuel costs, 20 percent reduction in maintenance costs and a 60 percent reduction in noise.

The Dreamliner is part of a transformation British Airways is aiming for in the flying experience which includes keeping track of how regular passengers like to travel and accommodating their preferences, putting passengers with connecting flights at the front so they don’t miss their connections and texting passengers when bags missed a connection, so they don’t have to stand forever at the carousel.

Representatives from British Airways and Boeing spoke at Capital Factory Wednesday before the British Airways Inaugural Kickoff party where flight simulators and photo booths with captains outfits were available.

Move Your Company to Europe

Following the presentation on the plane, serial entrepreneur and Capital Factory partner Fred Schmidt interviewed Matt Curtis, director of government relations for HomeAway, Virginia Miracle, chief customer officer of Spredfast and Jon Driscoll, Chief revenue officer of Mass Relevance about their experiences expanding their companies into London.

It’s crucial, all three said, to understand the culture before you either try to hire someone or move someone abroad. Driscoll talked about finding it suspect when his London employee said he really needed an office, because Mass Relevance was started in a coffee shop.

“But just try to find a place to work in downtown London that’s quiet, has internet access and a bathroom you can use,” Driscoll said.

Also, things tend to take more time. English employment law doesn’t include employment at will—in which, without cause, either the employee or employer can terminate. And while in Austin someone can be hired on Wednesday and working the following Monday “as long as we get their Mac on time,” Miracle said. In London you go through the whole process of hiring and the new employee says “Great! And I can start in three months!” Driscoll reported.

And the order of operations, who to hire when is another challenge, Miracle said.

Having someone in the position who is a really adept communicator is huge. All three said it is important to hire local people. Even if you augment your staff with Americans, locals know the culture and can steer you away from big mistakes. For example, Mass Relevance puts social media on TV. But publicly owned TV is a far cry from the private stations in the U.S.

Also, Driscoll said, they launched in London with a sales focus. He wishes they’d started with a customer service focus.

Curtis said HomeAway retains a number of employees in the countries where it operates, partly because it has grown by acquiring other companies and it just creates goodwill to keep those people on.

The big question often is, when is time to go? All three responded that when you can’t serve your international customers from home any more, it’s time to take the plunge.

HomeAway Acquires Australian-based Stayz Group

imgres-2In another move to expand its reach into the Asia Pacific Region, HomeAway announced its acquisition of Stayz Group, the leading online vacation rental marketplace in Australia.
Austin-based HomeAway paid $198 million to Fairfax Digital, owner of Stayz Group, which publishes Stay.com.au, Rentahome.com.au, TakeABreak.com.au and YesBookIt.
Stayz reported revenue of $25.4 million for its fiscal year 2013, which ended in June.
“The acquisition of Stayz adds 33,000 additional Australian-based properties to the HomeAway network,” CEO Brian Sharples said in a news release. “It also provides HomeAway a strong momentum to our newly-launched pay-per-booking business, something Stayz has worked over the years to optimize. Additionally, they have demonstrated that a vacation rental business can generate attractive margins operating on primarily a pay-per-booking model, and we look forward to learning from their team.”
The Stayz Group and its 40 employees will continue to be based in Sydney.

HomeAway Buys a Stake in Bookabach of New Zealand

images-5Austin-based HomeAway just increased its presence in Asia with the acquisition of Bookabach Limited, a New Zealand-based vacation rental site.
The world’s largest online marketplace for vacation rentals announced Wednesday that is has secured a 55 percent stake in Bookabach which has more than 8,000 property listings in New Zealand, Australia and the Pacific islands.
HomeAway did not disclose the terms of the deal of the all cash transaction.
The acquisition also includes Bookastay, the company’s affiliated Australian vacation rental site. Bookabach and Bookastay together feature more than 8,000 property listings in New Zealand, Australia and the Pacific islands.
The partnership broadens HomeAway’s presence in the Asia Pacific region and strengthens its presence in Australia and New Zealand.
“New Zealand is one of the most beautiful destinations in the world and we’re excited about adding thousands of New Zealand properties to our portfolio,” HomeAway CEO Brian Sharples said in a news release. “The Bookabach team has built a great brand among vacation rental owners and travelers in New Zealand, and we will build upon that by delivering more value to owners over time and continuously seeking ways to improve the experience for all travelers who choose vacation rentals.”
Bookabach Co-founder Peter Miles will serve as the general manager of Bookabach’s seven employee office in Auckland.
HomeAway executives will discuss the acquisition during its third quarter earnings conference call today at 3:30 p.m. central time.

HomeAway Joins Forces with Expedia

imgres-2HomeAway, the world’s biggest marketplace for vacation home rentals, has struck an agreement with Expedia to offer its properties on the popular travel search site.
The pilot is expected to launch early next year and it will include properties in the U.S. and Mexico, according to a news release.
“This is a significant milestone for the vacation rental industry and for realizing HomeAway’s mission to make every vacation rental in the world available to every traveler in the world,” HomeAway CEO Brian Sharples said in a news release. “As one of the most visited online travel agencies, each month Expedia.com will give millions of travelers the opportunity to discover the benefits of booking a vacation rental, and we look forward to also helping our customers increase the visibility of their properties.”
In addition to the Expedia deal, this month HomeAway launched two new services: a pay per booking model and its professional referral network.
Under its new system, homeowners and property managers can opt to pay 10 percent of the rental charge every time a home is booked.
HomeAway also launched a Professional Referral Network which offers a director of professional property management services.
The new service is also targeted at homeowners who rent their properties for six weeks or less, particularly those in seasonal destinations or cities that hold popular events.

Fostering Business Ties Between Austin and Frankfurt, Germany

Professor Ralf Steinmetz with Technische Universitat Darmstadt talking about Frankfurt's growing software and high tech region

Professor Ralf Steinmetz with Technische Universitat Darmstadt talking about Frankfurt’s growing software and high tech region


By LAURA LOREK
Founder of Silicon Hills News

At the W Hotel in downtown Austin the focus was on the high tech region of Frankfurt, Germany on Tuesday evening.
Hessen Trade and Invest and FrankfurtRheinMain Corp. sponsored the event, which featured networking and speakers from Texas, a Frankfurt university, Austin-based HomeAway and Frankfurt-based Crytek.
John Steen, Texas Secretary of State, and 20 people from Texas travelled to the Frankfurt region last April. The German people were very friendly and had traits similar to Texans, he said. He said he hopes to foster even more collaboration between the two areas.
Germany is known for engineering, said Professor Ralf Steinmetz with the Technische Universitat Darmstadt. The region also has more than 8,000 information technology companies, a number that is even higher than Silicon Valley. The region has 350 partners and 17 research organizations with a concentration in the software industry. And a lot of software is focused on the automobile industry. The region also has more than 70 game developers and publishers in the Frankfurt area, Steinmetz said.
One of the featured speakers was David L. Adams, CEO of Crytek USA, a game development company. He joined Crytek in January within a few days of shutting down Vigil, a gaming studio whose parent company THQ went bankrupt. The studio hired many of Vigil’s former employees.
“We went from being unemployed to being Crytek USA within a few days,” Adams said.
Crytek USA now has 50 employees and it’s working on a couple of projects with its Frankfurt counterparts, Adams said. One project is Ryse, an action/adventure game for Microsoft’s new Xbox video game console. The office is also working on another project that hasn’t been announced yet, he said.
Another speaker, Brent Bellm, chief operating officer of HomeAway, said the vacation home company publishes a magazine in Germany. It’s the only publication the company does, he said. HomeAway, founded in 2005, has become the world’s largest vacation rental marketplace. Today, it has 1,400 employees and is available in 171 countries with 775,000 listings. The company expects $350 million in revenue this year.
Frankfurt is HomeAway’s headquarters for central Europe, Bellm said.
“Frankfurt is, by far, the best place to do business in Germany, if you are trying to connect to Germany from outside Germany,” Bellm said. It’s a 20-minute taxi ride from the center of downtown to and from the airport, he said. It’s really easy to get around the city, he said. And the workforce is also diverse, well educated and hardworking, Bellm said.
“We’re big advocates for the Frankfurt region,” he said.

Startup Advice from Serial Entrepreneurs in Austin

By LAURA LOREK
Founder Silicon Hills News
BKKg61ZCAAAkRCVStartup founders can learn a lot from entrepreneurs who have been there and done that.
And on Monday, three serial entrepreneurs in Austin shared some of the challenges they faced in building their companies and some tips on how others can succeed.
Sam Decker, co-founder of Mass Relevance, Carl Shepherd, co-founder of HomeAway and Susan Strausberg, co-founder of 9WSearch participated in a RISE lunch and learn entrepreneurship super panel moderated by Ellie Brett, founder of Media Bombshell. About 120 people attended the event held at Mass Relevance’s downtown headquarters and sponsored by Turnstone.
Decker’s entrepreneurial roots go back to fourth grade when he ran a go-kart repair business and that got him into fixing engines.
He started working for Apple out of college. Then he ran three failed startups in the Bay area before Dell called.
“Even at Dell I always sought out the entrepreneurial jobs,” Decker said.
BKNAHbXCcAAg6ckHe worked at turning Dell.com into a big business. But after seven years, he wanted to launch a startup again.
Decker left to work at Bazaarvoice, founded in 2005. After five years, Bazaarvoice had $50 million in revenue and 500 people.
“Any time you are making that move to the next journey you are stepping off a cliff,” Decker said.
He left Bazaarvoice to co-found Mass Relevance, a social media company focused on handling Twitter campaigns for TV, sports and media companies.
Today, Mass Relevance has 85 people and does half its work for brands and half for media and sports teams.
Strausberg grew up in an entrepreneurial family.
“One needed to be in control of one’s own life,” she said.
Over time, she became obsessed with computers. She worked in publishing and film. She founded a publishing company and co-produced BKNAUiBCEAAbSdr“It Came from Hollywood,” a Paramount Pictures film.
She earned the title of “Dot Com Diva” for launching EDGAR Online, a financial data company, in 1995 with her husband Marc Strausberg. They left the company in 2007 to pursue other interests. They moved to Austin a few years ago to launch 9W Search Inc., an advanced financial search engine aimed at mobile users.
Shepherd, co-founder of HomeAway, was not a born entrepreneur.
“I did not come to be an entrepreneur overnight,” he said. “I was a late bloomer.”
At first he worked as a consultant for what is now Accenture and he also worked for magazine publishers.
He cut his entrepreneurial teeth at Hoover’s Online, where he worked as chief operating officer. Hoover’s Online was an information research business and was one of the first successful subscription based companies on the Web. He took the company public in 1999 and stayed on for a few years and then he joined Austin Ventures. That’s where he met Brian Sharples. They had coffee at Starbucks, the one that’s across the street from what’s now HomeAway’s headquarters. At that Starbucks, they started brainstorming ideas for businesses. They came up with one for selling information on outsourcing. But they both settled on addressing the pain in the vacation rental market. They both had families who liked to stay in rental homes instead of hotels when they travelled.
“Renting a vacation home really sucked,” he said.
They set about to fix that problem and came up with HomeAway as a solution.
Today, HomeAway has 1,300 employees on six continents including 600 employees in Austin, Shepherd said.
Next, Brett with Media Bombshell asked the entrepreneurs a series of questions including what was their biggest surprise about being an entrepreneur.
“The biggest surprise is that really great ideas and wonderful people and the best possible teams fail,” said Shepherd.
“So few people understand and embrace innovation,” said Strausberg.
“The highs are higher and the lows are lower,” said Decker. “Every rejection is like a rejection. And every win is like we’re going to be huge.”
But over time, the volatility starts to shrink, Decker said.
The next question Brett asked was what was the toughest challenge the entrepreneurs faced and how did they get through it.
Strausberg said in 2003 Market Watch wanted to buy EDGAR Online but that fell through. They had to pivot the business and find another way to exit the business, she said.
At Hoover’s Online, Shepherd bought a company called Power Rise in August of 2001 and after September of 2001 they had to completely revamp the business and eventually close down Power Rise. They had to pivot Hoover’s Online to go back to a subscription model.
Coming up with a company name is one of the biggest challenges a startup faces, Decker said.
One of the big challenges Mass Relevance faced when it launched was securing an official partnership with Twitter, Decker said. He personally negotiated the rights to use Twitter’s data, which was a critical aspect of their platform.
The panel also discussed how they handled risk. Decker said a good entrepreneur does his best or her best to mitigate risk.
And Shepherd said he has gotten more tolerant of risk during the past five to seven years.
“I feel like I’ve been far more in control as an entrepreneur than I was as an employee,” he said. “And I’m far more aggressive today than I was five or six years ago.”
The panel also gave advice to entrepreneurs.
Don’t lie to the IRS, said Shepherd. He has a 28-year-old son who is running a startup in the Bay Area and that’s the advice he gave him.
“Surround yourself with people and advisors who know what they’re doing,” he said.
“I would say first of all, think twice, then think three times,” Strausberg said. Thoroughly investigate the market, the competition and the validity of the idea, she said. And make sure you’re ready to cope emotionally with the risk and uncertainty of running a startup, she said.
“Think bigger,” said Decker. Whatever you’re thinking about add a zero to it, he said.
“Push yourself,” he said.

Austin Technology Council adds new board members

Austin Technology Council, announces the addition of Dennis McWilliams of Apollo Endosurgery, Lynn Atchison of Homeaway, John Arrow of Mutual Mobile and Adam Berman of TVA Medical to its board.
“These executives reflect the fast growth areas of Austin technology – bio tech and medical, mobile and wireless, consumer and Web 2.0 technologies,” according to a news statement.
Other members of the board include Susanne Bowen, CEO of PeopleAdmin, Rod Favaron, CEO of Spredfast, Mark McClain, CEO of SailPoint Technologies, Gary Sabins, CEO of Spinal Restoration and Manoj Saxena, general manager of Watson Solutions, IBM.
The Austin Technology Council’s advisory board also includes Rob Bridges, managing director, Wortham Insurance and Kevin Timmons, CTO Cyrus One.
“As the voice of technology in Central Texas, it is critical that our board reflects the present – and future – of this region,” ATC President Julie Huls said in a news statement. “Having a greater representation in bio tech, mobile and consumer tech is a statement that we will be strengthening our efforts to increase growth in the areas we believe are important to the region’s future.”
The Austin Technology Council, founded in 1994, has more 6,000 members including 230 member companies.

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