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  • HomeAway Secures Record $160 Million in Financing

    November 15th, 2006 No comments

    HomeAway, Inc., the world’s leader in online vacation rentals, recently announced it has secured a record $160 Million in debt and equity financing to fund continued expansion initiatives throughout the world — including the acquisition of the leading “rent-by-owner” vacation rental website in the U.S., Vacation Rentals by Owner.

    This funding represents the largest financing of an Internet software and services company in the U.S. in 2006, according to Standard & Poor’s Capital IQ.

    Existing investors Austin Ventures and Redpoint Ventures and new investors American Capital (ACAS), Institutional Venture Partners (IVP) and Trident Capital provided the financing. Since being founded in February 2005, HomeAway has raised more than $200 million in capital and has quickly become the worldwide leader for vacation rentals on the Internet.

    Proceeds from the financing will fund additional acquisitions of leading vacation rental Web sites to increase rental inventory, boost marketing efforts to grow traffic, and continue the development of industry-leading technology that improves the experience of locating and renting homes online.

    “Vacation rentals are a great value for leisure travelers and HomeAway is committed to expanding the market by making it as easy as possible for travelers to locate, compare and secure properties through the Internet,” says Brian Sharples, founder and chief executive officer of HomeAway. “The unprecedented number of people who own second homes in the U.S. and Europe means the supply of quality rental properties has never been stronger and that owners are now realizing the ease and great return on investment of marketing online. This financing enables HomeAway to grow its worldwide marketplace even more quickly.”

    Simultaneous with the close of the latest round of financing, HomeAway announced the acquisition of VRBO.com, HomeAway’s largest competitor, representing nearly 65,000 properties worldwide. VRBO.com was founded in 1996 and is the market-leading online directory for rent-by-owner vacation properties in the U.S. With the addition of VRBO.com, the HomeAway portfolio of vacation rental websites, which includes HomeAway.com, now comprises more than 130,000 properties in nearly 100 countries.

    “VRBO has always provided an extraordinary value for its customers. We are privileged to have them as part of our company,” says Sharples. “We look forward to leveraging the resources of both VRBO and HomeAway to create the world’s largest and most diverse vacation rental marketplace and provide tremendous benefits to both the advertisers and travelers who use our sites.”

    “VRBO has had many opportunities to sell over the years, but we chose to sell to HomeAway because we recognize that they are making the right investments and management decisions to establish vacation rentals as a popular travel alternative for the mass market,” says David Clouse, founder of VRBO. ”We wanted our customers to be a part of that.”

    “With this financing and the acquisition of VRBO, HomeAway has established itself as the clear market leader in online vacation rentals,” said Todd Chaffee, managing director of IVP. “The company’s management team is the best in the business and we are extremely optimistic about HomeAway’s future growth.”

    Phil Siegel, partner of Austin Ventures, says HomeAway had significant investor support because of the market opportunity and the company’s leadership position. “HomeAway has all the ingredients we look for in a later-stage private equity investment – big market opportunity, great customer value proposition and clear industry leadership,” says Siegel. “Most notably, HomeAway is already highly successful in terms of both revenue growth and profitability.”

    “We had significant investor interest in this deal, which we believe reflects that HomeAway has aggressively staked out a vertical segment that is tailor-made for the Internet,” says Thomas Weisel, chairman and chief executive officer of Thomas Weisel Partners, which advised HomeAway on the financing.

    For more information, visit: http://www.homeaway.com

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