[PODCAST] Triptease Founder Charlie Osmond Tells All: How his tech startup got into 12k hotels, raised $20M in venture funding and beat a $65B company
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Here's the unedited interview transcript:
Jordan: Could you start by telling us a little about your journey into the world of hotel tech?
Charlie: Hi, so yes, straight out of University started my first business and I did that then for another think 10 or 12 years. And so I was coming to the end of that and feeling thinking about what what is it? I want to do next which industry but I like to be in for the next decade and I guess that's worth pointing out. So I think a lot of people don't always. Realize how long it takes from startup to successful business, but in my mind definitely it's worth thinking about Decades of your career if you're doing a start-up so as all when I showed the place I'd really like to spend time is online travel. And the reason for that was that. It was the biggest Market on the internet, right? It's a huge market and I think as an entrepreneur you need to go after big markets if you want to create a large business and also because when I thought about my life and the thing the single thing that upset me most throughout the year the single biggest pain and frustration. It was always when I was booking our family holiday. I can never quite understand how you know one week holiday would take me seemingly 3 or 4 weekend's worth of effort in looking at assessing choosing then getting input from My Wife and before eventually booking the damn thing and it hurt me so much that experience that I just thought. How can it be that this this massive Market online is still so painful to navigate their just have to be opportunities here, too. To make a difference. So yeah, that was really that's what kick me off. I think that's something that really a lot of people can relate to it's incredible that with all the tools out there today. We're still not able to book travel seamlessly it could you give us the elevator pitch for tripped. He's tripped. He's today is a technology company that is focused on helping hotels Drive direct bookings and improve the guest experience on the website. So really everything we do is about optimizing. The current website the current booking engine hotel has and making it a better guest experience and increasing bookings a result.
J: Yeah. I've seen the product and I'm a huge fan of what you guys are doing and it's incredible the impact you've been able to have on your hotel customers with such a simple and scalable product. I think one of the really interesting parts of your business is that you've created a really fun and engaging brand for something that's somewhat of a niche and Technical product. Could you tell us a little bit about what the Triptease brand means to you and how that's played into your success.
C: It's a really really want so it's funny because we started the business as a sort of consumer-facing brand and Triptease was actually trying to get across. The way in which people could share their great travel experiences and tease others about their trips. So as a there was a very good reason for why the name is as it is and also the other reason why the name is striptease is because it's a little playful and I wanted something that would stick in people's minds the when we shifted to becoming focus on really the brand is targeting hoteliers and hoteliers are our customers. We did a one of our investors was actually quite Keen that we change the brand. But we stuck with it and I think the reason is because it is seen as playful and yeah, maybe maybe 1% of people really hated or really dislike it but I think it's far better that brand drives and motion. And if that means there's something don't like it, but others really do love it then then I'm all for it. I. I've there's a there's a great investor great VC in Silicon Valley who runs a firm called 500 startups and I think it's advice on branding is do crazy stuff because you're startups probably going to fail anyway, and I guess we see our name is just one little bit of a little bit fun we can have.
J: Yeah, that's a great point. And I think a lot of times with the ups and downs of the startup roller coaster. It can be difficult to have fun. So it's great that you guys were able to find a way to bring that into your day-to-day speaking of those kind of that early period and that roller coaster in those pivots. Can you talk a little bit about your first 18 months and what that felt like?
C: Yeah, I mean it was a it was a horrendous time our first 18 months horrendous, but also fabulous it was. To extreme emotions and the thing that surprised me the most was how many different times in one day it was possible to oscillate between disaster and success as excitement and misery and really that was it I would say is 18 months of a roller coaster ride, where one day you might think. Oh, we had this great new idea for a distribution or we've had this great result where we got someone who really is excited about what we're doing. And then later that same day or later that week something disastrous would happen and what you expected or he thaws already believed it turned out wasn't true or you found another competitor that was doing something or a tried the same thing and had failed which was actually worse than a competitive doing well in many ways. So yeah, it was just it was a roller coaster and then at the same time as the business, I guess fortunes and potential going up and down. You also would have the the finances of the company. So I mean from a personal point of view. We had to sell our house. We had to move the company into our basement in a place. We rented to save money on rent which meant my wife and kids coming back into the coming home in the afternoons and finding, you know computers and people strewn across the house doing their work. So there was some definitely stressful moments, but at the same time all of that stress was. So rewarding and so much fun and it's a great feeling when you're literally building a business on your dining room table. It's it just feels I guess it imbues the company with a special culture and having gone through some of those hardships together the core team who was there at the beginning I think, you know when we're connected for life really and so it was hard but it was also really rewarding that's really an incredible story and such an example. I bought a sad for entrepreneurs going through some of the trials and tribulations at this stage.
J: I want to start talking a little bit more about some of those tribulations that you had in 2015 you woke up one day to a letter from booking.com alleging that you had been unlawfully using their data. Can you tell me what that felt? Like I can only imagine how I would feel in that situation.
C: Yeah, well, I've described we went through a few ups and downs before we ever got there. So I guess the roller coaster of emotions. I was quite used to it was it was not a great day. I have to admit when a I think at the time 64 billion dollar business tells you that they want to take you out of business and they write to all your customers and tell you that they're going to sue you and sue your customers and so it was quite quite worrying but the same time I'm an eternal optimist and I look at every. Challenge as an opportunity and immediately. I was thinking this is good. We've been we've been starting to see other companies try to copy us this this threat is also going to be an issue for them. And when we resolve how to get through this it's going to be hard for the next people trying to follow us. So, you know every hurdle is an obstacle for your future copycat competitors, right? So so so there were worries and there were concerns but the same time it was like, okay, how can we turn this to our advantage? And we spent a fair bit of time. I got to say talking to lawyers that was important. And and we also you know, it's all about as you should always do in every situation. What are the. What are the opportunities you've got in Your Arsenal that you can kind of use and I guess in one sense the pr was one side of that. Actually, we would just kind of deciding about how do we talk about this and then somebody else leak? The letter leaked a letter to one of the hotels to the Press so it kind of Hit the Press before we had quite decided how we're going to respond. And then once it is done that we just thought well then which case we have to be we've got to be talking about this. It's it can be slightly harder as a large company in a dispute to give a clear opinion to every question from a journalist. But as a small company that one advantage we've got is. I'm making decisions and I can you know immediately give my opinion without having to confer with lots of other stakeholders internally. So we kind of felt this is this has got to be our opportunity. Then the issue has blown up in the Press. Let's make sure that we're open and available to talk about our Viewpoint, right?
J: Yeah. I think I can completely understand booking trying to protect their lunch. But at the same time, I think it's. Such a testament to what you guys have done the really kind of Judo philosophy of using the weight of your opponent against them obviously really played out in your favor speaking of booking.com. I have seen a lot of OTAs moving into the service business and even heard an Expedia executive talk about seeing himself as a service business rather than a distribution play. You kind of see the investment into Alice from Expedia and. And Priceline into Boutique and hotel ninjas. Can you talk a little bit about what you're seeing in terms of OTAs moving into the direct booking space and services.
C: Yeah, I think it's fascinating seeing the OTAs get more into dark bookings. I think that there were some important strategic Investments for The O'Jays to make because it's one way if for example consumer opinion or whatever was to shift dramatically towards booking directly. Then that could be a real challenge to Oda. So it's important that they sort of spread their bets and they get involved. I think also actually it's just it's a really smart move on the oth pause again so much of the value that's duty is to bring it to Market is tied up in their ability to analyze data on behavior. And so with Priceline owning booking sweets and therefore managing and running thousands of Hotel website. Again, that's just that's just more information more data that they're able to use. So I think they just they see it as a Naturals of extension of what they're doing. I think there is a there's again there's a definite risk, right the risk is that if you're a small hotelier and you got there for very very little power in the big scale of things and your website and your booking engine is. Provided to you by one of the OTAs and your central reservation system is provided to you by one of the OTAs their ability to then for example, get you to only display availability or to make sure they display more availability or always have laws from availability on their site goes up right there the power Dynamic shift even further in their favor. There are plenty of hotels all say. Booking.com is just one of the best run websites on the internet if those guys it also going to build my website and I'll be a fool to let anyone else do it because probably it will convert at a higher rate. I don't know that that's right, but that's certainly the other side of the aisle. Right. That's what anything there are trade-offs on both sides and really just kind of choosing what risk you're willing to accept as a hotelier is the main point here when you look at at the OTAs and Priceline Expedia, specifically you just see massive massive Market. But at the same time
J: David Temple who is a member of Hotel Tech Insider and the founder of Hello Scout kind of points out that VC and the industry is really difficult. The industry doesn't have high enough margins to support a strong SAS business. What's your take on that? One of the things that the OTAs have done without question why particularly compare Car Hire or you can pair Airline fees the commission's that the OTAs are managing to command from hotels. All incredibly high and that's you know, that's why the margin the OTAs are getting is massive. So the idea that there isn't there isn't a big enough market if you're shifting people's direct. It's just it's just not an issue right price line is one of the biggest markets one of the biggest biggest biggest digital businesses globally full stop. And there they are that size and they'll that scale because of the margins that they have the commission's are charging. Right?
So it makes sense that it really depends on where you play into the value chain and which part of the p&l you're going after with your product or service and where you want to move the needle whether it's increasing revenue or decreasing costs and really looking at that on a more granular level. I wanted to switch gears a little bit. And go to a question from euclides major who is the founder and CEO of guests.
J: Our listener named Euclides Major who's the founder of Uguest is really curious about what your day-to-day looks like. I know since you've hired your brother your leadership philosophy is changed. Can you talk about kind of what you were doing as the business started and how that's changed today?
C: I think I might have hesitated to talk about hiring my brother in the past. But actually it was one of the best things I ever did. So I'm quite proud of it and my brother who'd been running a another business very successfully, but she sold before this one. He had a very clear I guess view that what the business needed. Now as we were going through a new stage of growth was to hire a senior management team and that really all the decisions were going to be made by the senior management team not by me the chief tease. And he was pretty adamant about this and that was that really did lead to a shift of yeah hiring a more experience more Senior Team internally and. Me moving from try to be involved in every decision to not being able to be involved in, you know, even 5% of them because it's just so much going on now the team's expanded and I'm overseas when you see other people in the business going ahead and making decisions that I guess you wouldn't have and then you see that they were right and they were successful and great decisions. Then you think okay. This is so much better. The company is so much better for it. But I think now the answering the question of what I do day today, I'm often diving in and it's deciding. So the specific projects or specific things that are going on today or specific customers who needed help where it's appropriate and it's right for me to really dive in because. Yeah, now I think about my role as being what are the things that uniquely I can do and what are things I can do uniquely as the chief T's is I can shine a light very brightly on specific issues that I think exists within the company or that may exist. That's a great point. And I know Steve Jobs used to say that you hire smart people to do smart things and it seems like that's really working for you at striptease. And I know in the past we've talked about shining that Spotlight on company culture and.
J: Estella Hale, who's the VP of product at SHR and also a Hotel Tech Insider wanted to know how you've been able to maintain the company culture as you've had such rapid growth when I think about small businesses and you know, our goal is to hire amazing people and keep them motivated and excited and within the business the there are so many things that big companies can do you know that we can't for example, we don't fly people in anything other than economy.
C: And so I always think well, what are the things we can do? No business is harder for a big company and one of the things that we can be complete transparency because and also we're going to a great journey as a start-up we've been growing quite quickly. And so we kind of feel it's our duty to educate everyone on his everything. We're learning about how to grow a fast-moving business and hopefully those are things that will inspire them all to start their own companies in the future. Ray and that's definitely something that I think is lacking in a lot of corporate culture today. It's kind of hitting the top piece of Maslow's hierarchy and that self-actualization and really empowering employees and making them feel valued. So I think that's an incredible retention tool and a great way to really build that corporate culture. The next question comes from Shawn Carter Shawn is the director of operations at Bisley very successful New York based startup that helps. Hotels and other businesses rent out and meeting space via their online platform. So coming from a little bit outside of the industry Sean was curious as to how you tackled some of the scaling issues because as he points out hotels can be slow to adopt new technology and not wrongfully so it's more because new technology can disrupt existing processes.
J: So what do you think was the key for you to drive such rapid adoption?
C: Maybe some of the the smallest attract we've done to try and identify early adopters is actually look at the technology that you've got. So there are. It also tells on lots of different booking engines. For example, we believe there are some but they're a bit more that are a bit more sort of up-to-date and therefore we look for hotels with those booking engines because we know that if hotels working with this with this bit of software then that hotelier is probably a bit smarter about their business and they're more prepared to try new things. And so you can look for indicators like that that suggests that this is a dynamic organization that wants to try things first. Yeah. Sure.
J: I think Charlie brings up a really. Interesting perspective here and that you might not want to think about your Target customer as a specific type of hotel by their rooms or their chain scale, but even going deeper than that and understanding the kind of Behavioral traits of the actual buyers and adopters of your product could be an interesting angle to. And so Charlie the last question before we head into the speed round comes from Erlanger Johnson, who is the CTO of Tour Desk? And he really wants to understand what your most effective Channel or tactic has been to scale your business today.
C: It was always the most effective tool in my last business. I think the SaaS industry in general is one that has grown very quickly through inside sales. So that's people sitting inside the company as it were not not leaving their desks and phoning up prospects. That's been that's been our number one.
J: What is the worst piece of advice you've received since founding Triptease?
C: He's so I said, we would we built the digital post called products. We'd managed to get the investors to back us and give us a million pounds and a month later. We went back to my said thanks for the money. We've just decided we think that there's actually much better product called price check that we want to do and they versus said the rest said look we've just given you a million pounds, please use it to work on digital postcards because that's what we agreed. And so they said carry on with what we're doing and a month later. I went back and said I ignored you and we're going to build price check instead. It's going to be a lot better. It's incredible. I am sure that they're thankful. You did not regard their advice today.
J: If you could form a partnership with any travel company, who would it be and why?
C: Well, you just got to think big right so I mean Google is the is probably the single organization. That was most hotels Google analytics. I think is really fascinating because it's probably the one bit of code that's on more hotel websites than any other and yet I feel that at the moment because it's generic tool hotels get very little often get little value from it because I don't set it up properly. So I'd love to find a way to work with.
J: And last one here Charlie, who is the single most interesting person you've met in this industry
C: Steve Rubin at Dennihan. He is every time I meet him I learned a whole bunch of new things and I often have to get in to repeat them a couple of times because I'm not as fast enough to keep up with his brain.