Rearden Commerce, the under-the-radar automated online assistant that helps people organize travel needs and other services, has raised another $40 million in a Series F funding from JPMorgan Chase. This latest round brings Rearden’s total funding up to $240 million since the company’s launch in 2000. JPMorgan Chase is a marketing partner and a pre-existing investor. Greg O’Hara and Rick Smith, both general partners from One Equity Partners, JPMorgan Chase’s private equity fund, will be joining Rearden’s board, although the funding comes from Chase Capital Partners.
Unfortunately, the funding is bittersweet for the company because it coincides with a round of layoffs. Rearden let go roughly 60 employees from a staff of 335 employees (or 18 percent), following a round of layoffs last November of around 10 percent (or 40 employees) of the company’s staff.
At this point, with so much capital invested in the company, the best hope for Rearden investors to see a returns is if it goes public. Rearden is hoping for an IPO, but before it files it wants to hit profitability, and therefore it is cutting its way there. Public investors are going to want to see evidence of sustainable profits and clear revenue growth. Investors generally prefer companies that are hiring to keep up with growth than cutting back to hit their numbers.
Rearden is better known in the corporate world, offering its services to more than 5,000 corporations, up from 1,700 in May, 2008, with over 2 million individual employees using the service. American Express resells the service to its business customers. Last year, Chase also signed on as a reseller and marketing partner, offering the Rearden’s personal web concierge service to its bank cardholders.
Rearden offers enterprises an automated personal assistant that helps their employees organize any sort of travel-related task. They can set their profile up with the types of restaurants they like, whether they like aisle or window seats, and their preferred car provider, and Rearden will book all aspects of their trip for them. Rearden also launched a mobile version of its service that will sync up with their calendar, message them with alerts and allows them to make changes to their itineraries and bookings. The service also keeps track of reward miles and points from airlines, hotels, and rental cars, and lets employees use those points to book additional travel and other services. The service will even keep track of travel credits and apply them to future trips.
The company had a banner year in 2008, raising $100 million in funding, growing the company’s client and user base and expanding into the mobile space. The site also acquired Global Ground Automation to assist with limousine and other ground transportation reservations, and ExpenseWire to simplify expense reporting for users. Rearden is still planning to target consumers directly, after promising to roll out a consumer-facing service for the past few years.
its like a web based luxury spending productivity tool for rich people
interesting that they have burned so much cash and never hit profitability in 8 years.
may be rich people prefer to spend on luxury in traditional way.
Rich people have people to buy their luxuries.
Rearden smells to me like a tech version of Madoff.
$25mil/yr for 9 years and still no juice?
Hmmm founded at tail of bubble yrs, way too much VC $$$ and still not profitable.
Cutting way to an IPO…Yeah right !
LOSER !
They’re raising money to buy new deck chairs for the Titanic. They’ve blown through $200 million with nothing to show for it. The new funding will last them a couple of months, and then time for round G. Employees that are still there have been miserable for the past 2 years, but the CEO is scaring them into staying. They are so far from being cash flow positive, it’s sad.
I’m still amazed that they’ve had so much VC money, and I’ve never heard of them, let alone used them!
Hank Rearden should sue for the use of his name in a defamatory manner. $250M for a travel booking website?
It’s a transition, that’s all. Rearden is well on its way to becoming a dedicated softwared development shop within JP Morgan Chase.
No doubt the financing came with some revenue commits as well. A little sweetner to maintain a march towards profitability charade. To date more than 90% of Rearden’s revenues are from “strategics”. But these speculative investments masked as revenues from large financial institutions, do not a business make…
Rearden is not well known because it is not used much by large corporations. Relatively speaking it has a very small footprint within companies, and it hardly plays a strategic role for any of them. The 1000’s of customers are mostly small businesses signed up by American Express, and they represent very little financial upside for Rearden.
Rearden Web Platform? There isn’t a single published Rearden API! Small point though, for a platform to be meaningful to 3rd parties you need millions of *active* users.
Rearden IPO? – they need $50M and 6 quarters of profitability, or a rapid rise in revenue bearing transactions. Nothing to see here, keep on moving folks…
A broad Intillegent assistant? A tall bill to fill, with little algorthimic or usability innovations beyond travel and niche travel applicatios. At the end of the day Rearden is the BEST corporate booking tool. That’s a $300M company (or large division within One Equity Partners, owners of Carlsen Wagonlit, Travel Aquisitions Group and Travelport).
Meet the future home of Rearden Commerce:
http://www.onee...s/portfolio.php
At this point it’s just a matter of “right sizing” the organization and more importantly, the cap-table, to fit a private equity investment thesis. That means mega-cram down around the corner… Rearden common stock is worthless, and preferred shares are as well (10 times zero is still zero…).
The bigger they are… the harder they fall…
If you like working on software development at a large bank you are going to love Rearden’s future.
Companies should be using GoTo Meeting or Cisco’s Telepresence instead of this luxury travel stuff.
Alternately, one could argue that these products are only for execs (C-level managers in mid to large companies). Mkt cap is bounded. Look at Concur as some sort of proxy here.
A quarter-billion dollar travel booking for aging swashbucklers whose time is too precious to waste on Kayak?
These must be the same silly old people who buy cars from Toyota’s “Lexus” brand.
Oh you earned it, hotshots!
$240 million and its under the radar? eh?
This is a strange story. Overfunded and wasteful company driven by overpromotional CEO. But, at the same time, solid investor/board members in Foundation and Oak. They must see something that the rest of us don’t.
Is this Chase’s version of too big to fall ?
Does anyone here think that the final story won’t revolve around hookers and blow?
What is this? a Las Vegas Casino ? Trade your employees like a f**ing chips at the table. They give you heavy salary, good stock options, and a kick on the backside after 6-9 months of service. good thing, i didnot accept their offfer.
Having worked at Rearden I am still surprised they are still in business. They decided to move to a larger office right next door spend millions of dollars on it then move right back to where they started fro. The executive staff are clueless and the morale of the remaining staff is non existent. If they had sense they would move on just like some of the brighter executives who have now jumped ship or are planning to jump ship very soon.
Rearden is becoming more of a travel shop day by day.
I’m sorry but this is just stupid. A software does not need that kind of money. There is no way there will be any type of meaningful return for the last round or three of investors.
An “F” round. Wow, that is amazing.
I went to site and have NO IDEA what I am supposed to do. If I was dropping $40 large (extra large??) I think I’d want people to know what to do when they get to the home page. (Not sure why I am so neg, but that’s what is coming out.)
Me also I can say ”
Does anyone here think that the final story won’t revolve around hookers and blow?
“
So much money from so many strategics – Fortune 100 financial services. Maybe the F round is code for TARP or some other government handout.
Reminds me of Covisint.
the problem with Rearden Commerce is not their product. It’s actually a fine online travel booking engine, oh excuse me I meant to say “personal assistant,” that assists corporate travelers with their travel reservations. The problem is that Rearden Commerce is trying to sell their online tool to every single travel agency in the country at extortionate prices and many of them are not biting. They are by far more expensive for a typical travel agency to use than other online booking tool companies i.e. get there, resex.
Lower your prices, make money through volume not through a price point that no business will pay for particularly in this economy. Also, they should try to stay one step ahead from their primary competitor in the corporate online booking tool marketplace, Concur. If anyone wants to figure out why Rearden Commerce keeps getting millions in investment funding needs to look to their CEO for that. He’s quite the salesperson that would convince an Eskimo that it would be a good idea to buy an ice pop in the middle of winter.