Hipmunk, founded in 2010 by Adam Goldstein and Steve Huffman, was a travel search engine designed to simplify booking flights and hotels. Known for its user-friendly interface and innovative "agony" sorting feature, Hipmunk rose quickly but struggled with revenue and user retention, leading to its eventual shutdown after being acquired by Concur.
What Was Hipmunk?
Hipmunk, a travel search engine, offered users a streamlined way to book flights and hotels. Its unique value proposition lay in its "agony" sorting feature, which balanced price, travel time, and layovers. Notable achievements include its acquisition by Concur for $58 million and its influence on travel search interfaces.
What Happened to Hipmunk?
The story of Hipmunk is a compelling tale of innovation, growth, and eventual decline, marked by several key phases:
Innovative Beginnings and Early Success: Hipmunk was co-founded by Steve Huffman and Adam Goldstein in 2010, quickly gaining traction with its unique "agony" sorting feature. This innovative approach prioritized flights based on a combination of price, duration, and layovers, setting it apart from other travel search engines.
Acquisition by Concur: In 2016, Hipmunk was acquired by Concur for $58 million, a significant milestone that underscored its value in the travel tech industry. Despite this, the acquisition led to layoffs and a shrinking team, impacting the company's operational dynamics.
Technical and Market Challenges: Hipmunk faced numerous technical challenges, including poorly optimized database usage and multiple rewrites of web code. Additionally, the shutdown of Yahoo Travel in 2016, a significant revenue source, further strained the company's financial health.
Failed Strategic Pivots: The company attempted to pivot by investing in a chat bot and native mobile apps, but these initiatives did not gain the expected traction. These strategic missteps contributed to its inability to sustain growth.
Competitive Pressures: The rise of competitors like Google Hotels, which offered similar services with more robust technology, made it difficult for Hipmunk to retain its user base. This increased competition ultimately led to its decline and eventual shutdown.
When Did Hipmunk Shut Down?
Hipmunk officially shut down on January 23, 2020, as confirmed by a Hacker News discussion thread. This date aligns with a blog post by a former employee, who mentioned the shutdown was set to occur seven days from January 17, 2020.
Why Did Hipmunk Shut Down?
Acquisition by Concur: The acquisition by Concur in 2016 marked a turning point for Hipmunk. Despite the $58 million deal, the acquisition led to layoffs and a shrinking team, which hampered the company's ability to innovate and maintain its systems. This shift in operational dynamics contributed significantly to its decline.
Technical Challenges: Hipmunk faced numerous technical issues, including poorly optimized database usage and multiple rewrites of web code. These technical missteps made development more challenging and resource-intensive, ultimately affecting the company's ability to deliver a seamless user experience.
Loss of Key Revenue Source: The shutdown of Yahoo Travel in 2016, a significant revenue source for Hipmunk, further strained the company's financial health. This loss made it difficult for Hipmunk to sustain its operations and invest in new initiatives.
Competitive Pressures: The rise of competitors like Google Flights and Skyscanner, which offered similar services with more robust technology, made it difficult for Hipmunk to retain its user base. This increased competition ultimately led to its decline and eventual shutdown.
Failed Strategic Pivots: Hipmunk attempted to pivot by investing in a chat bot and native mobile apps, but these initiatives did not gain the expected traction. These strategic missteps contributed to its inability to sustain growth and adapt to changing market conditions.
Lessons Learned from Hipmunk's Failure
Adaptability: Stay flexible and ready to pivot based on market demands and technological advancements to maintain relevance and competitive edge.
Resource Management: Efficiently manage resources, including team size and technical infrastructure, to avoid operational bottlenecks and financial strain.
Revenue Diversification: Diversify revenue streams to mitigate risks associated with the loss of a key income source.
Innovation Consistency: Continuously innovate and improve your product to meet evolving user needs and stay ahead of competitors.
Strategic Focus: Ensure strategic initiatives align with core business strengths and market opportunities to avoid missteps and wasted investments.
Competitive Awareness: Keep a close eye on competitors and industry trends to anticipate challenges and adapt strategies accordingly.
We Shut Down Startups
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