The HouseTrip email of Wednesday 27 April 2016: "We’re thrilled to announce that we’ve been acquired by TripAdvisor, the world’s largest travel website."
I wasn't thrilled... I was crying into my morning coffee.
NB: This in an opinion by Sam Friend, investor, advisor and non-exec director.
As an early angel investor in Housetrip.com I'd seen my $50,000 investment rise to over $1 million, and then disappear.
Rather than the bland "sold for an undisclosed amount" headline, I thought it would be more useful to carry out a public post-mortem so we can all learn from the mistakes and avoid them in the future.
1. Stick to your knitting and excel at it
"We want to make booking a European apartment as easy as booking a hotel"
In 2010 it wasn't the fondue I had just had with the founders Arnaud and Junjun that made me invest in HT, it was their simple statement above.
Having lived in Europe on and off for the last 5 years I'd observed the proliferation of apartments and marvelled at how fragmented the market was and also how shite the process was to actually book one of these apartments.
HT's original proposition was strong and their initial traction was strongest in the French-speaking market, which interestingly was the market they ultimately retreated to in their last days.
However instead of focusing on its home turf in Europe HT decided to go head to head with Airbnb and chase the global market.
As a result, they became a generalist in all markets and a specialist in none.
Europe is a region that requires deep engagement in each country, relationships are key to securing apartments, their managers and ultimately their guests.
A contrasting successful European online travel playbook is from the $1.6b-valued BlaBlaCar, where it has have 18 localised European websites including both a Flemish and French site for Belgium.
HT has a mere five localised sites and no physical presence outside its headquarters in London and customer service centre in Lisbon.
I find this astounding for a business that raised more than $60 million in venture capital.
So where did all that money go? Onto the next learning...
2. Having no product differentiation and an addiction to Google Adwords isn't a growth strategy, it's suicide!
The apartments market in Europe is a large, fragmented business estimated to be worth annually in the tens of billions.
There are numerous avenues HT could have chosen to pursue, including: high-end, business, family, gay, groups etc.
OneFineStay chose high-end and are now $170 million better off as a result. Kid & Coe tailors their offering to families and TheHomeLike are chasing the business traveller.
HT may not have been a magical unicorn with such a strategy but I'm confident the position for shareholders today would have been far better.
Instead, HT fell into the addictive trap of relying on Google AdWords to grow their business almost at any cost.
Online marketing spend ate up all of their revenues but more worryingly ROI was being forgotten in the chase for top line growth.
By 2014, this party ran out as AdWords costs rose and customer acquisition costs exceeded lifetime customer values, leading to the incumbent VC's turning off their taps.
A lifeline was thrown to HT in the form of $10 million in venture debt and with a new CEO at the helm there appeared to be some light at the end of a dark tunnel.
Alas, a continued poor generic strategy and a misguided foray into TV advertising driven by overpaid advertising execs sounded HT's death knell and a desperate search for a buyer followed.
3. Don't chase mythical creatures
As part of the sale process, I found out prior to the last VC round HT could have fetched $150 million to $200 million on the open market.
If this was the case, I think Bill Gurley would agree with me that the HT board and founders should have forgotten about their mythical unicorn chase, taken the money and ran.
That certainly would have been my choice, if only us minority shareholders were given a say.
NB: This in an opinion by Sam Friend, investor, advisor and non-exec director.