GetYourGuide Secures $97M Revolving Credit Facility

Optimism Emerges for Travel Startups with New Funding

As numerous nations begin to experience a resurgence of hope fueled by vaccination programs, a promising travel technology company, previously hindered by the pandemic, has announced a $97 million financing agreement to sustain operations until travel normalizes.

GetYourGuide Secures Significant Funding

GetYourGuide, a Berlin-based startup specializing in the curation, organization, and booking of tours and experiences, has obtained a revolving credit facility totaling €80 million ($97 million based on current exchange rates).

UniCredit is leading this financing round, with participation from CitiGroup, Silicon Valley Bank, Deutsche Bank, and KfW.

Strategic Use of Funds

According to CFO Nils Chrestin, this funding will enable GetYourGuide to rapidly capitalize on opportunities when consumer travel resumes.

The capital may be allocated to standard operational costs, potential acquisitions, strategic investments, or further development of the company’s in-house Originals tour offerings and last-minute booking services.

Adapting to Current Travel Trends

Despite the overall slowdown in tourism, demand persists for short-distance travel and local experiences. While some cities, like London, are primarily open for bookings far in advance, destinations such as Rome and Amsterdam currently offer activities available for immediate reservation.

Creative Approaches to Financial Stability

GetYourGuide’s recent financing highlights the innovative strategies employed by startups—particularly those negatively impacted by the pandemic—to maintain financial stability.

A History of Investment

Since 2009, GetYourGuide has secured over $600 million in equity funding. Its Series E round in 2019, prior to the pandemic, valued the company at over $1 billion, with a substantial investment of $484 million.

More recently, the company, backed by investors including SoftBank and Temasek, has been reinforcing its financial position through alternative financing methods.

Convertible Note and Debt Facility

In October, GetYourGuide finalized a $133 million convertible note. Alongside this, the newly established revolving debt facility provides another efficient avenue for accessing capital, potentially extending up to 18 months before a new equity round is closed.

Benefits of Revolving Debt

Unlike equity financing, revolving debt facilities are non-dilutive and offer flexible credit lines. Companies can draw funds as needed, repay with interest, and then re-borrow up to the credit limit.

This type of facility functions similarly to a consumer credit card, signaling banks’ confidence in GetYourGuide’s ability to repay and ultimately recover.

Industry Support

Jan Kupfer, head of corporate and investment banking, Germany, at UniCredit, stated, “We are very happy to help GetYourGuide continue its growth trajectory during this extraordinary situation.” He emphasized the bank’s unique tech advisory approach, combining technological expertise with a comprehensive range of banking products.

The Future of Experiences

The travel industry has faced significant challenges, but experiences, a core focus of GetYourGuide, represent a promising area for growth due to the limited presence of digital platforms in this sector.

However, startups like GetYourGuide have been largely maintaining their position while awaiting a resurgence in travel demand, impacted by travel restrictions and public health concerns.

Growth and Challenges

Last October, GetYourGuide reported surpassing 45 million ticket sales. However, an increase of only 5 million tickets over ten months indicates a substantial slowdown in growth and the difficulties the company is confronting.

This trend mirrors the stagnation or decline experienced by other sectors within the travel and tourism industries, with many anticipating prolonged financial challenges.

Airbnb as a Contrasting Example

Airbnb presents a different scenario, gaining investor confidence and experiencing a steady increase in value since its public offering in December.

Analysts suggest this optimism stems from Airbnb’s long-term potential and its position as a leading tech-driven solution for travel needs.

Looking Ahead

Chrestin believes the U.S. market, a key region for GetYourGuide, may begin to recover in the second or third quarter. Regardless, the company possesses the financial resources to navigate an extended period of reduced travel.

He highlighted the company’s streamlined internal processes and increased efficiency, stating that the crisis has been “quite transformational.”

Financial Stability and Long-Term Outlook

“The company is very well capitalized and fully funded to profitability,” Chrestin affirmed. “Even if the current travel volume stayed like this for three years, we would not run out of capital.” He expressed confidence that this scenario is unlikely to occur.