One of my favorite startups in Silicon Valley is Rearden Commerce. Few people have heard of it despite the fact that the company has been around since before the first Internet bust in 2000 and has raised $200 million in capital, most of it recently.
The reason few people have heard of Rearden is because they are a behind-the-scene service. They offer a sort of automated assistant that helps people organize travel needs. In 2007 I called it “mashups for adults:”
Their strategy to date has been to sign large corporate customers and create customized websites for their employees. The service acts very much like a personal assistant. Set your profile up with the types of restaurants you like, whether you like aisle or window seats, and your preferred car provider, and Rearden will book all aspects of your trip for you.
See restaurants within a certain distance from your hotel via a Google Maps mashup (and based on Zagat ratings and cuisine), pick one, and the software will make a reservation for you through OpenTable. Then they’ll sync up with your calendar and your mobile device, and send you messages if anything goes wrong, like a flight delay. You can also access their mobile client to make changes to your itinerary. The interface is orders of magnitude beyond what Orbitz and other travel sites offer (click the screen shot for a larger view), and they’ll also book your restaurant and find you tickets to the Lakers game that night if you like.
Rearden will also keep track of reward miles and points from airlines, hotels, rental cars, etc., and lets users use those points to book additional travel and other services. Cancel a flight? No problem. Rearden keeps track of the credit in its system and suggests you use it the next time you travel.
The company had just 92 corporate customers a couple of years ago. Last year in May (when they released a mobile version of the service) they hit 1,700. Now they have 4,000 corporate customers and more than 2 million total users.
At some point the company will offer a consumer version of the service, something they’ve been promising for over a year. It’s one service that I’d gladly pay for.
In 2008 the company made two acquisitions – Global Ground Automation to assist with limousine and other ground transportation reservations, and ExpenseWire to simplify expense reporting for users. And they added two key executives – Ammiel Kamon (head of worldwide marketing) from Emptoris and Netscape and Dan Pritchett (Chief Platform Architect), a former technology fellow at eBay. CEO Patrick Grady named to the list of 25 most influential executives by Business Travel News along with CEO of Delta Airlines, CEO of American Airlines and John Chambers of Cisco.
Investors include JPMorgan Chase & Co. and American Express, and both of those companies offer the solution to customers.
It does sound awesome and certainly something I would pay for it.
This affirms my thought that often the best companies doing the most with the newest are under the radar. Reardon obviously understands modern web techniques, and is using actual business savvy to turn them into gigantic revenues.
Bring on the consumer version, my wallet is open.
they aren’t start-up. they’re a fairly large private company. that’s it.
They are startup in so far as they’re STILL unprofitable. LOL.
@winefield – what’s your definition of a ’start-up’?
This kind of subscription business will not going away in fact it will prosper in a long time. Corporate, small business as well as individual will rely on this kind of service. it a matter of how effective your service and your marketing to individual need on how you can serve them.
Nat
This is a genius idea, I’d pay for the service!
Not that Rearden Commerce is boring, but what ever happeend to Rearden Labs?
Weren’t they supposed to come out with some GPS-Enabled VCR powered by a Sterling Engine last summer?
Did they die? Did they get suffocated by Stealth Mode? Is their burn rate still “thermonuclear”? Did they ever announce their product?
What was the product anyway?
They might be under the radar but it sounds like they are definitely getting it done. Impressive service, thanks for the heads up.
$200 million raised. Have they ever made a dime? Not a success until they do, so don’t call them one.
I think this article is missing some very important key points that would not have taken much time to research. I’m suspicious. Why would you leave out such obvious questions?
1) What do end users think of it? Does it save them time? Is it really that different than just using Google search, Expedia, and Outlook?
2) What do paying corporations think of it? Is it a luxury for their execs or does it save them money in the long run? Is there ROI?
3) What are the implications in 2009, the iPhone / Blackberry era, when great apps are free and location based search can help travelers. AroundMe, for example.
4) What are the implications in a down economy when luxury perks and travel expenses are being pulled back? Limousines? Personal assistants? These sounds like lavish boom time costs, not cost saving efficiencies.
Re #1) Yes; I work for a Fortune 100 company and it saves a lot of time. When booking a trip flight / hotel / rental car can all be done at once, only approved vendors are displayed, and the expense approval process is highly simplified. It’s not just for execs; I’m a mid-level engineer.
Nice to hear about startups like these that don’t get too much media attention.
Can you say Web 2.0 bubble???
Last round valuation of approx $500M
Burn rate north of $3M per month
$200M raised
Little revenue and zero profit.
Sounds like a good business on paper but a horible investment destined to fail like all high cap high burn companies do.
I remember these guys as Talaris when I worked there. They had recently changed their name from MyGazoo before that. Anyone have the story on the change to Reardon Commerce?
Good, I am wondering do they provide the service to AMEX Black cards and Platinum
Coverage of long-term private companies like this should make up a larger portion of the posts on TechCrunch. Both private and public investors would appreciate any insights you can bring.
Why no mention of the flood of employees streaming out of the place? I’ve seen more Rearden resumes in the last 3 months than from any other single company, by a factor of 10.
I don’t know anything else about the company, but that one fact doesn’t seem too great to me.
Articles like these don’t tell the whole story. The product is no different from a corporate booking engine, but misleading presentations are used to convinced customers, investors, and the press that they’re building an “internet personal assistant”. They’ve burned through over $100 million, and raised another $100 million to build a product that could be built with a small team and $30 million.
Michael, why don’t you do your due diligence and ask Rearden to show you a demo, not a presentation. Ask them where the “assistant” is. Displaying a Google map next to a list of hotels and adding a frontend for OpenTable is not my idea of “mashups for adults”.
Agree to the previous post that these articles don’t tell the whole story. This is a old company and many people left that company. The main reason they are surviving is that American Express (which is one of their investors) does a lot of corporate booking/travel arrangements and have been pushing Rearden Commerce to be used.
Rearden may be a little old for the typical start up, but wasn’t it in stealth mode for 5 of those years? I believe other companies, like Microsoft, have tried a similar project in the past and failed, so it makes sense that they would spend some time in R&D.
The fact American Express and Chase are investing in this company makes me wish that I could. I’m definitely going to keep an eye out for a consumer product and future updates on this company. Thanks for the info Michael.
By the way, I wouldn’t want a blog to tell the whole story otherwise I’m not sure if I’d make it to the bottom of the page. If you want to find out more about something, check out their website…. That’s what I plan on doing.
So are you implying the company’s website will describe their practice of pulling baits and switches on their customers?
Late last year they had some layoffs
i wonder how many of their “new” corporate customers came from the acquisitions that they made…
this company has been around FOREVER and has raised WAY too much money recently. This company is representative of the excesses of BOTH bubbles (2000 and 2008) which is pretty rare actually.
Listen folks…It all really comes down to execution. They’ve raised 200 million dollars which is great, but the question is what are they going to do with it? What is it that the investors want delivered and what necessary steps is the company taking in order to ensure they meet those expectations while becoming cash flow positive? This JP Morgan/Chase deal is huge. They have over 90 million card holders and from my understanding Rearden is building them an application for their reward points redemption program and it will be a free service for chase members. If even 25% of Chase card holders actively use this application you’re looking at ~22 million users and that’s low balling. I think advertisers would be willing to pay a nice chunk of change with that type of activity, not to mention the transactions that will be taking place using the other services Rearden offers.
Rearden has certainly paid their dues being around for 8 years but they been making a lot of noise in the last 3. They are now in a position to control their own destiny. I look forward to seeing how they do.
If even 25% of Chase card holders actively use this application
If only 1% of the people on internet clicked on my banner ad my product would be an instant hit!!
Can’t believe techcrunch keep deleting negative comments about Rearden Commerce.
If they can’t face the truth and criticise only keep tailored comments according to their needs, arrangement with Rearden Commerce?)
this site lost value as a creditable media.
byebye. techcrunch, out of my bookmark you go.
its not about facing the truth, it’s about ridiculous anonymous trolling that pollutes the blog.
So if TC praises a company with no ability to execute, and anyone who knows the company well disagrees, it’s called trolling?
Both Eric and Michael have been singing praises of this truly amazing PR entity (not so hot on the actual business front). TC has lost tonnes of credibility on this one and yet they continue to sing Patrick’s tune. Why? He is a great salesman indeed, but by know it has all grown stale. So will TC unless it starts admitting its mistakes. BTW the negative post removed was FACTUAL. Which is more than can be said for TC’s coverage of Rearden.
Michael, if you want the right to criticize mainstream print media you need to live up to the same standards as them. In particular, you’re lack of journalistic integrity is a major sore spot that you need to work on. I realize you’re just a blogger, but you’re clearly educated and have designs on a new media empire. Being cast as the “Fox News” of blogging will not help you get there.
Phil
I also very interested in this company. I’m as skeptical as anyone else due to all the money they’ve burned, the layoffs, etc, but the fact remains that their product (as described) sounds pretty compelling and despite all the hardships the company IS still around after all these years. Plenty of times a company takes it on the chin a few rounds but through sheer willpower, gumption and execution manages to pull through (plus the company name sort of indicates the founder is not the type of guy to throw in the towel). I’d really like it if someone (hint hint) could crack their stealth sphere and give us a real lowdown on how well the product really works and how things going over there.
For a first time blog post this coverage would be fine but considering Techcrunch has reported on Rearden a number of times this post contains no useful information. How about a little analysis of Rearden? The facts are as follows:
1. Rearden Commerce has a great product that goes well beyond existing travel management solutions. However, 1/2 of what Grady says is the “vision.” It has a long way to go before really being a personal assistant.
2. Grady has done some amazing deals to line up the channel (Amex, Chase, etc) but totally lacks an understanding of the customer. They’ve been singing up companies left and right but they need to learn how to keep them happy.
3. Executing on the consumer launch will be very difficult especially for a company that has no understanding of marketing or branding. As evidence note that the company name has changed three times, they laid off the whole marketing team without a second thought, and even their best customer doesn’t know what to call the product (as opposed to the company name).
Rearden Commerce is a good company that is set up to succeed if Grady can hire somebody to manage the company so he can focus on doing deals and being the visionary.
For more insight on Rearden Commerce you can also check out Glassdoor.com. Anyway, it is at least as “balanced” as the Techcrunch coverage.
Rearden pays Arington to run these puff pieces once a year. Remember, it’s blogging not journalism. For the real skinny on Rearden Commerce and it’s bombastic CEO Patrick Grady visit http://www.glas...r.com/index.htm
Staggering amount of VC money, lots of customers, almost no revenue after 8 years! The only thing this company consistently produces is pink slips.
At Westinghouse we use the Rearden platform through American Express (they call it AXIOM or online marketplace). It works well, and it even works on my blackberry. You can read about it right here:
http://www.btno...t_id=1003931565
It’s a sad day for TechCrunch when they take down comments for a particular company. There is no doubt that TC got a call from Rearden and gave into their requests to take down specific comments.
This comment has nothing to do with whether or not I believe that Rearden is a good company but rather if I can trust the integrity of TechCrunch going forward.
What’s the deal hear? Why should all of us keep following TechCrunch if there is no free speech here?
A concerned TC fan
So Michael, how much stock has Rearden given you?
I used AMEX travel at my last company and frankly they sucked in a big way. They would misbook stuff all the time.
Once they even left me stranded in Denver on my way back to SFO. Apparently, the numbnuts only booked the segment to end in Denver even though I had asked for a round trip ticket and started in SFO. WTF?
http://www.ewee...e-With-Rearden/
How is this company’s product different than Concur? http://www.concur.com/
My company (Fortune 500) uses the Concur product. Its decent. Nothing great, nothing bad.
I love the last comment.
I do not what all the fuss is about, start up.
SMB Rearden! SMB!
My firm started using them for airline travel. The customer service COSTS to have a question answered, unlike the airlines. Tickets do NOT book right away, so seat assignments on short notice can’t be managed – and UPGRADES can disappear while you wait. If you want 24 hour availability for customer service (off hours), it costs even more. And, the final touch, several of my flights have given me 50% of the mileage. When I called to inquire as to why, I was told “that shouldn’t be. We will investigate and get right back to you.” Two weeks later, NOTHING. Use at your peril.
Chapter 4 is light. Here are some additional quotes from Grady:
“I’m personal friends with [insert any famous business leader here]. And he says this is the right way to lead a company.” Then why are we still unprofitable 10 years after you founded the company?
“We knew the downturn was coming and we’ve been preparing since last year.” Then why did we have layoffs and pay cuts?
“I’m close friends with lots of people who quit this company.” Really? Name one. Maybe they are too busy hanging out with the business leader “friends” he’s always getting advice from.
“I’m the best person to lead us through the next few years.” The results from the past few years speak for themselves.
This is the best comment I’ve ever seen on techcrunch.
Chapter 6: How to sell, by Patrick Grady and Tony D’Stalfo (my apologies for misspelling his last name.)
Step 1: Build a travel engine. Design and implement it poorly. More in chapter 7.
Step 2: Arm your salespeople with a Powerpoint presentation for an Internet Personal Assistant, a corporate spending management tool, and whatever else you want to call it. Make it the best presentation imaginable.
Step 3: If selling to a woman, let Tony expense his cologne, and later have Tony play sexy voice mails from her at the company meeting.
Step 4: Deliver a travel engine. Tell your customers the rest is coming.
Chapter 7: How to develop a product, by Matt Mihic, VP Engineering until Patrick replaces him
Never use open source. Why use something that works when you can reinvent it in a buggy way. VP Engineerings should stick to coding, and checking in undocumented buggy code. Let 20 engineers waste time fixing my bugs. Project Managers should architect. Engineering Managers should sit around and count bugs. Engineers should provide scotch for me.