Even the co-founders, Craig Hewett (left) and Ross Veitch, would admit they were too early. The market wasn’t ready, customers weren’t ready and perhaps even they who started it seven years ago weren’t quite prepared for what it meant to launch a business where no one had gone before.
They soon found out they were right. Veitch, who this year became CEO after Martin Symes became non-executive chairman, recalled, “When Craig and I first started, Craig was CEO. But we quickly realized we were getting out of our depth and needed to bring in a professional CEO who had built several organizations.”
And so Symes, who had previously worked with ZUJI and before that, American Airlines, came into the picture. “We call Martin our Eric Schmidt, our adult supervision.”
Still the going remained tough. Said Veitch, who had worked with Yahoo prior, “The first couple of years were hard and Wego was an expensive hobby for Martin, Craig and I. Between us, we put in S$2 million which we were fortunate to have but it was not easy by any stretch.
“But by that time you are so deep in that it motivates you,” he laughed. “It also helped us during investor roadshows because people could see we had serious skin in the game. This is what I tell entrepreneurs – bootstrap it first, get it started and then raise funds.”
Added Veitch, “Martin got us through some critical patches during those early years when most start-ups fizzle.”
The company went through two fund-raising rounds – he declined to say how much equity’s been surrendered but said “the founders still have serious skin in the game” – and Symes put together a top team. “He’s laid a great foundation,” said Veitch.
And now it’s time for Veitch and Hewett to go the next stage without “adult supervision” and Wego is in serious expansion mode. The day of this interview, it had just launched its 35th local language site, in United Arab Emirates.
This global expansion into local markets is true to the original purpose of Wego. “When we started Wego, it was to build the biggest travel search in Asia Pacific. No one was doing it. The market was fragmented. All trends were in our favour. Since day one, a third of our visitors were coming from outside the region and it became clear that what we built was of interest to people outside the region. Thus we decided to localize the product and serve emerging markets worldwide.”
“A significant more” sites are in the pipeline, said Veitch.
Two markets are top priority – Indonesia and India – and Veitch sees Indonesia becoming a “global competence” centre for the company. “It’s a good place to be hiring product managers for mobile and for building social apps. We will also use Indonesia as a laboratory, it’s our number one market in terms of visits, it’s huge in mobile and social networking.”
The Bahasa Indonesian site was launched last Christmas although a lot of Indonesians also use Wego in English, said Veitch. “We tweaked the model a bit in India and Indonesia. We built our platforms with scale and internationalization in mind.”
The company has also decided to focus on its roots of search and has scrapped the Wego Fast Deals business it launched last year, at the height of the deals craze. “We will aggregate deals rather than create our own. We don’t wish to compete with suppliers and it’s a super competitive space. It’s better to focus on what you are good at.”
While the company started as pure flight search, hotels now form almost half of content. “Years ago, the air ticket was the big ticket item but since low cost, that’s changed. Increasingly people are booking hotels and then booking flights around that. They fly low cost, stay high end.”
While some might think that Wego’s done a couple of pivots in its business model the last seven years, Veitch said the fundamental model hasn’t changed. “We are still aggregating price and availability real time, we just had to adapt to different markets. If you look at flights in Indonesia, now it’s mostly airline direct and OTAs are just moving in.”
In three years time, he wants Wego to be the first place people think about when it comes time to search for travel. “It’s about making the whole marketplace more efficient, save time, save money so people travel more.”
To build a leading consumer brand though takes money and without the deep pockets of brands like Expedia and Priceline, the going might be tough. “We will do it through PR and social media. Once people try it, they like it, they tell their friends. Half of our traffic in Singapore is repeat.”
He sees ways to build user loyalty through social and community and it’s being tested in Indonesia. “I think people are only scraping the surface of gamification,” he said.
The bigger concern is what Google is going with flight and hotel search. “With flights, they are very US domestic at the moment and it will be a challenge making it work in Asia. Their Hotel Finder product has cool elements, keyboard shortcuts, deal finders – how cheap it is today versus the usual.
“What has made a difference is pushing Google Local onto their sites and changing links to aggregators and sites like ourselves and taking people direct to local hotels versus OTAs. Whether this is serving the hotels or the best relevant choice for consumers, I don’t know.”
As for an exit, Veitch said it’s not what they are focused on right now. “We are nicely profitable and growing, there are lots of possible exits.” He did add though that the company is beginning to think of a third round of funding.
