GetYourGuide CEO & Founder, Johannes Reck: The Wild Story Raising $450M From Masa and Softbank

I would have not raised as big of a series A looking back. I think it was too much dilution. What did change was that suddenly I felt like a celebrity. That was the moment when I made the biggest mistakes. If you have a Sequoia capital or an index or a Spark Capital on your cap table, the reality is that your next round will be so much easier. Ready to go.

Yeah, totally. So, this is actually 2007-2008. Um, you know, Tao and I were both students at the Swiss Federal Institute of Technology. He was doing physics. I was doing biochemistry and neurobiology. So, something very remote from online travel and uh we both led a student delegation to Beijing and China uh at the time. And I made a pivotal mistake in that I booked my flight ticket a day early and arrived in Beijing uh without the group and you know I was trying to you know do stuff then in my hotel room. I logged on the internet you know was like going on Google trying to find things to do going to Beijing wallet like doing something with the day and I couldn't find anything. I got stuck in the hotel room. Next day tower shows up you know he he shows me the city. um you know we go and see um the Beijing wall, the Great Wall, you know, we have Beijing duck, you know, in the Hutong. So it was like a really special day and um you know, from that epiphany really of like having seen the the city through the eyes of a local, someone who speaks the language, we went back um to Switzerland to ETH and said, you know, we have to build a website, we have to build a community for people uh so they are able to do that. And we did that and like the prequel to to get your guide was like we were building a travel community for everyone to be a guide. No one actually used that you know I think we had 100 guides because that's what I read.

Totally. It was terrible.

First iteration was literally a peer-to-peer websites for guides. You know small like untold story is we also considered doing something like couch surfing at the time. So, so homes and we, you know, we thought, you know, no one is going to stay at someone else's home. So, like, you know, discarding that idea, you know, someone else in San Francisco picked it up very successfully and then, you know, we went to guides and like you know, go like guiding is such an important thing in travel. So, can't we build a community of guides? But we were thinking this, you know, from the lens of the student. We didn't do any market research or anything. So, we built a social network. Only 100 students signed up. Most students don't have time to be guides. And we we had I think three to five bookings in the first two years of our prototype. Three of which was my mother because she took so much pity on us students. Three to five bookings in two years. Yeah. But then like what what we realized through that prototype was that there was this gigantic market out there for experience providers particularly in Europe. I mean Europe has 60% of the global inbound travel. I mean, just walk out outside of the studio here in London and you see, you know, anything from the London Eye to the Thes River cruise to all of the hop on off buses. Uh, you know, you see Madame Tousos, you know, the Harry Potter tours. Like, there's just so much to do in any city. And none of that was digitized in 2009, 2010. So, we went back to the drawing board and said, you know, look, like we clearly didn't find product market fit like this first iteration was terrible. Let's pivot into this much bigger market that's out there. And that's just not digital.

Completing our degrees. So we were still at uni at the time. So we're still at uni living honestly off very little money at the time. But the the great thing about it was um you know we could fail like there was no problem in failing. And um even more so it was just a lot of fun like know we didn't do that really to build a company even at the time. It was more like you know this is a great space you know we want to build like a really successful web product you know Facebook was going viral at the time or so so those were like the days of web 2.0. And we're really working at night to be honest. Like we were studying throughout the day and then at night we'd do this.

No. Uh, respectfully, you have to be all in and we had an all-in moment. Um, so the first iteration of the product actually failed, right, as I told you. And then we had to go out with the second iteration. And with that second iteration, you know, we were done with our degrees and like we really needed to try to make this work because it was clear you can't just do this on the side. You really need to sign up supply now. You need to sort of like build an online marketing function and need to do online marketing. And at that point in time, um, we really needed to go full-time with a prototype that was unproven and two years of failure, right? It's a in in a weird way it was a very stressful moment a and even worse I need to go to my parents and basically say hi you need to fund me for like another year after university so you know can you please you know put a mortgage on your house and like fund me because there was no seed capital available no one would give a bunch of students money at the time for an idea that wasn't proven.

So, honestly, I have no idea looking back. Um, I think like the best thing um that happened to me at the time was that I had this group of co-founders that was really strongly tightly knit after this like know one of one and a half years, two years of like doing this prototype and we just really got along so well and it was just so joyful to go to work every morning with them and like create something. So it was really more of a gut feeling that this is the right thing to do. It just felt right than anything else. Um but the way how we operated at the time was really being in this deep tunnel. You know I I once met the great race car driver Nico Rosar like Formula 1 champion and he said you know when you go and race right you look at the road you don't look at the wall because if you look at the wall as a race car driver you're going to hit the wall like so stay focused focus on the road. And I think that's very much what it what it felt like at the time, like we're even considering failing. Like for me, like failure was nonoptional. It was like, you know, that that's not a valid option. We will stay the course. We'll win this.

Well, then um what happened was a miracle because we signed up the first couple of suppliers and we got very lucky with a few of them. How do you do that? Literally cold calling and like you know going to people like I you know I remember I traveled to Selzburg and signed up the hop on hop off bus tour. It was very random. There was like no CRM or anything like that right? So it was very much you know what looks good you know so like what's nearby whom can we address? And um we got very lucky because we got a very good tour agency which did tours to the Vatican very early on and the Vatican is like one of the major sites in all of Europe and no one had sold the Vatican online at that point in time. I still remember the day when they went live and suddenly the booking started to tick in and then we had more and more of these types of experiences. You know we you know signed up Madame Tusos we signed up the London Eye, you know, Merlin Entertainment Group. Um it's just so many of these supplies that had never sold online and for them was very foreign to even think of online bookings in 2010, right? Which is like very foreign. And um you know then the the revenue just came and and like you know we're growing and growing. I think we did something like half a million then in in the first year in 2010 in net revenue so commission revenues more or less profitable but we didn't have any cash because we're just living off the mortgages from our parents. So we're constantly looking into the abyss and and that was also the first time when I realized there's actually seasonality in travel. So it actually goes up in the summer and then November it really goes down. So for the first one or two years without any type of VC funding we're literally going bankrupt every winter needed to somehow survive. Um so it's very tough early years.

No, no. This is 2010, 2011. There's basically no venture capital scene whatsoever in Europe. And the the biggest problem was um that we didn't have a US original that we were a copy of. So, uh I remember I was talking to Oliver somewhere at the time. You know, we had started to relocate some of the staff from Switzerland to Berlin because Switzerland was just too expensive for us to survive in our bootstrap mode. And you know he looks at me he's like you know so so what's the equivalent here you know like in the US like you know you had the copy of what exactly I was like there is no exact copy you know we're trying something new here like you know experiences marketplaces don't really exist right now but I believe it's future of travel and he was like so do you want to join rocket internet or do you want to work on your own startup and I was like you know I'm going to work on my own startup he was like okay thank you very much see you and you know this is really the spirit of the time it's very hard to like recollect because things are so different today, but we couldn't raise funding.

I think um the three of them are incredibly smart dudes and I think they have created the Berlin ecosystem single-handedly. You're that is it really and and it it is that I never did business with them. Um but I must say that without them um even get probably couldn't exist.

So first uh VC funding was uh from Brent Hobbererman who invested like you know a small seed check alongside with an outfit called Profounders um here out of out of London. Sean Satan Rogers. Exactly. And that was actually really weird because you know I got a ticket um in a sponsor ticket I think through some like lottery or something to go to L web which was like a big startup conference at the time and brand was on stage and you know I couldn't raise VC funding. We had this business that was constantly going bankrupt but growing really fast. And then, you know, I I just hit Brent up after he was on stage and said like, "I'm in travel. You found it last minute. We should talk." And he was like, "Okay, interesting. Here's my business card." And, you know, picked up the business card, you know, wrote him an email, just like cold email basically, and he said, "You come and see me in London." But I think so like I don't even know whether he really knew who I was or what I was doing. So I remember I I went to see Brent at the mate.com offices um you know back then this probably like 2011 2012 and I had to wait for 4 hours to get like a 10-minute meeting uh with Brent and I still vividly remember the meeting I think he does too and it was basically you know this is what we're doing you know we're creating um you know the experiences marketplace you know this is the you know next biggest thing in travel. It's the last big green field. No one has conquered it. And Brent looked at me and he said, "You know, I made one pivotal mistake at lastminute.com. I had the opportunity to buy Booking.com at the time as a seedstage company. I still regret that to present day. I'm not going to make that mistake twice. I'm going to invest in you." And that was the moment really we got our first funding and you know, the rest from there is history.

It was a million bucks. A million bucks at what price? It was um I think at like a five or six million pre- money. So you did very well. Wow. A million at five or six. Okay. Fantastic. But that wasn't the first VC meeting. I heard that you got rejected 100 times.

It's very hard to compare the days back then to, you know, what we have today. I think that the constant is you have to have tremendous tenacity and you will have to pitch a h 100 times and it will only work once maybe. But I think what's different is you can refine your story and you can refine your product market fit so much more these days and you have so much bigger of a community of mentors and best practices. All of which I didn't have at the time. I didn't have anyone to talk to who had done that before. And I think that's really the big difference that I would really lean into today. like lean into the ecosystem and um get that help that is out there because today there's just so many people who have done it before who have had the lessons and who can help you succeed.

So from there on um you know we continued with our you know I would say like bootstrapping mode but you know with a little bit more money and so like not going bankrupt all the time which is positive. But um what Brandt actually then did is he pretty much immediately afterwards set up um you know a meeting with a bunch of uh VC funds in the US and that referral from him as a proven travel entrepreneur made all of the difference. And so suddenly we were starting to get meetings you know people got more interested and just you know there was just a much better reference for me as a first-time founder as well and uh ultimately there was a a partner called Alex Finkelstein at Spark Capital who took like a very keen interest in get your guide and he was like no this is interesting like there's something there and then he led the a round in 2013 and that was really the moment that get transformed where was the business at that point business is doing somewhere around 2 million net revenue at that point and growing I think uh 2x to 3x year over year.

Series A at the time was actually very big for European standards at the time. Um so it was um somewhere around 14 million uh as a total series 8 like I think like 30 35 million pre money.

I would have not raised as big of a series A. Looking back I think it was too much dilution. Ultimately it all worked out because you know if you're in the company for long enough you know there's also founder reups and all of that. So I would say personally uh it didn't matter but I do think um you should actually manage dilution um because otherwise you end up you know with problems with your employees you know with the you know other investors and also the so like share of like early stage investors just gets too large uh which might be a problem later down the road. We fortunately at get your guide got all of that fixed over the years but uh I do think at the time was a little bit too much.

Totally. No, look I think the the founder incentives uh that you see uh first and foremost should happen after a longer period of time right so so you know if I look at myself I think the first founder incentive package that I personally um got awarded um by the board with um I think happened after like a decade or so. like much later and then there's a lot of market best practices and standards and you know if you're a more mature company you know an investment bank can come in and like benchmark that against peer companies and then it works out but at the end of the day you know at that point in time you get awarded as a founder CEO right or like as a founder management team um you know for the work that you're doing um in terms of driving share price for shareholders over the next decade totally get you okay so needs the A and that's a US fund leading Being a European company, that's a big moment. How does that change the company?

Completely changed our life because at the time the series A was very large uh in terms of total quantum. So we had a lot of money and also very few US VC companies were investing in Europe at the time. So we went from a nobody to a superstar literally overnight. And could you feel that in the ecosystem in the presence how people respond?

100%. I think the only equivalent uh at much greater scale happened in 2019 when we raised from soft bank vision fund like that massive round. So so those were like the two I think defining rounds of of of the company but with the A it was really going from being a complete nobody to someone who is like very present on the startup radar and and in the scene. we could hire like completely different people but also I must say um that was the moment when I made the biggest mistakes uh in hindsight in in in building the company so we almost lost the company after raising that a round.

So, we first and foremost um listened way too much to the VCs. You know, we were like these young founders not having a clue and we completely lost our way and you know going to the board meetings literally uh looking for advice of what we should be doing in our strategy instead of pushing for the strategy that we saw working in the dayto-day.

Well, they had a much longer term vision um around, you know, hey, you should build, you know, SAS products for your vendors. Uh you know, you should do multimarket, you know, you should go into all of these new customer segments, into all of these new supply segments. And most importantly, you should hire all of these senior people to do all of that. A and that's about the worst thing you can do as a series A company without really like, you know, proper management experience. um it's much better to stay very narrow and go very deep and continue to drive the growth that you're seeing from the core customer segments that you have and do much less but do that much better. So we we were going way too broad hiring a bunch of people that were completely wrong for the stage of company. No culture fits and growth then started to really calm down while expenses spiraled up like crazy. And I remember like a year or so after raising that a round, I needed to lay off 30% of the company and completely rejuggle get your guide to refocus us on the core.

I did it thankfully. I did it quick enough and I got incredibly lucky that at the time a um person that's not actually not very well known in the European startup uh ecosystem, it was probably one of the most successful European founders of all time called Case Colon called me up um you know one Friday night I was watching Netflix with my wife you know we were sitting there and you know he called me up and he said you know here's Case Colon and I obviously knew him because he was the founder and CEO of Booking.com and he said you know look Johannes I left Booking.com. I've heard about your company. I think you're on to something. Um, give me your numbers. So, I run him through the numbers. He was like, you know, give me like every cohort and like, you know, every kind of like supplier. And it was just just like really going deep like on the first call. And by the end of it, it was like, you know, one and a half hours in, he said, "This is interesting. I'm going to be in Berlin tomorrow morning, 9:00 a.m. at your office." This is Saturday morning, right? And, you know, next morning I 9:00 a.m. I'm there. So cases there and like he goes to the meeting room with me and to the whiteboard and like he basically maps out like the entire journey of like you know where he sees value and like where I see value asked a ton of questions. It was literally like you know being in the room with the Jedi grandmaster you know for like you know almost I'd say the full day and then he leaves and he's like I'm going to come on board like I'm joining a board of directors and I'm going to personally invest a million bucks in the company. That was incredibly pivotal because it happened exactly at the point of time like when I was laying off the 30% of the people when I needed to reboot the company at that point in time I had someone alongside with me who had done this before and who was like a really good mentor and that that truly transformed me and you know I told case 2 three years later when the company was success I probably learned more from you than from my dad.

I think you need fundamentally different people for a series A to series C D stage company than you know for a preIPO or public company with billions in revenue. And I do see it today being on the other side of that. people who are incredibly effective at Netflix or Meta or Google or you know even get your guy today are not the type of people who really thrive um you know with a 30 or 50 people company where you still need to continue to refine that core product market fit uh where the way how you manage and do things so different because you're in the weeds every day with the team you need to ship stuff you need to be really opinionated about what's going on and then the muscle that you have later on around you know managing multip multiple teams, managing organizations, doing road maps and you know creating more structure in the organization which you need at some point otherwise things don't work anymore um when you're at a certain scale those are just fundamentally different skill sets and typically also different types of people often times VCs mix these two phases so you really need to have these very entrepreneurial people um in the early days who often times by the way don't work out in the late days um so when you're going public and you know that stage of of your life. Those are not the same type of skill set. So, it's really about can you find these people who are strong culture fits, who are right for your company at that point in time.

Not having a really tight strategy. You know, founders typically think that they have way more capacities than they really have. So being really tight on what's the core thing that we want to be doing and how can we deliver value to the customers and how can we obsessively focus uh on that. So this is really the core lesson from case and booking.com was don't do too much. He told me at booking you know they had looked at experiences for you know many many years and you know he said you know on these type of innovation projects um you know people had to go to the innovation department. The innovation department had one person that was himself and it was called the no department because he was always saying no go and refocus on the core because typically people underestimate the runway that they have with their core products and really improving that and and and achieving product market fit and scaling that over a longer period of time is much more valuable than doing 10 things that are all sexy but you're going to be mediocre at all of them.

Absolutely. And we did perform. So the beautiful thing was we had a lot of really good people in the company. So instead of hiring expensive new exacts, I just promoted the best people in the company, which was the best thing I ever did, and gave them a responsibility. Although a lot of them were very junior to their jobs, but they were just incredibly motivated and they were in the trenches, so they knew what was going on. We refocused uh the company really on our core segments of attraction tickets and guided tours and just the core European capital. So we weren't looking worldwide as we did after series A but just looked at Rome, Paris, London and we went and acquired you know all of the supply there and and you know no big magic but um you know suddenly demand was coming back and growth was coming back. We're going back to more than 100% year-over-year growth at much better unit economics and just, you know, I think 6 to 12 months after that, we could raise a really good series B.

Series B was uh co-led by Spark uh Capital and Highland Europe. So, Spark Capital was so impressed by us going through that roller coaster of like dropping off the cliff, you know, reshaping the company, bringing Case Colon in that they said, "Hey, you know, you guys are clearly on to something. um you you're doing this right. And this, by the way, another advice for a lot of founders. We gained so much more respect when we went against the board and said, "We're not going to do this, we're not going to do that. We'll focus on this. This is my opinion. This is where I stand." You know, suddenly the VCs were like, "Yeah, you know, we follow you. You're right." Instead of just saying, "Oh, this is a great idea. We're going to do it." You know, really shaping the opinion of the board and of the investors is something that I really learned during that uh period. And that is something that I would also say um then afterwards helped us actually raise the subsequent rounds because we're so much more opinionated about what we were doing. Series B is often said to be a very hard round. You you need to have a very clear proven model and say about kind of edging into the scale capital phase. When you think about the series B and getting Highland, how many meetings did it take to get the series B together?

It was very easy because Highland um actually co-invested with Spark and you know those guys actually really liked each other and um the partner who actually joined from uh Highland Fergle Mullen is a tremendously great guy and we had immediate kind of product market fit with him. you know, he loved Get Your Guide who was a customer. You know, he sat down and I vividly remember, you know, when when he invested, he literally uh let us pitch for 30 minutes and then he pitched for 30 minutes. So, we were like, you know, this guy is like something special. Like, I had never seen that NVC before. Uh, you know, he showed me through his fund deck. He was like, "This is my strategy for the fund. I wanted to do something for Europe, you know, Highland Europe, but you know, he just came back from the US and it was really about creating that ecosystem here in Europe." So, we felt it was such a good connection. And so it's actually that that was a very easy one. How big was the series B?

Series B was I think roughly 25 million if I remember correctly. Added like 100. Yeah, a little bit less than that but 90 100. Yeah. Okay. Any lessons on that on price dilution cuz we're still in a safe zone here, aren't we? In terms of like not crazy price. No, it's still I mean those are also still the days where you know there were no crazy prices. That only happened you know from 2015 16 upward to 2021. For us that was an easy one because we had such a strong comeback. This one of the easier runs uh that we had raised. But um I would say what really was the difference is that we had a strategy. We had a good team. Not the team with like the big CVs um you know but a team that was really on to it. It was entrepreneurial. There was hustling every day. And then lastly we had the traction and the numbers to prove it.

It's all in the numbers. I think from the series B and C onwards. If you don't have the numbers to prove it, it's very hard to raise that round.

So from then onward uh we basically rinse and repeat for a number of years. Uh and you know we're obviously growing our supply base. We're growing the demand base. We're growing to more European countries. We're doing a little bit in the US. Um but it was basically rinse and repeat all.

It was a big one to take hold of and to be honest probably we did it prematurely. If I'd go back in time is another lesson for a lot of founders. I would have not gone as early. I would have done more in Europe. I think we would have had even more growth and more profitability, but we did a little bit in the US. It wasn't detrimental. So, we weren't overextending ourselves and we're building a good foothold there. And um then all of that leads up to raising a massive round from SoftBank Vision Fund and Timas in 2019.

At the time there was a small team there u with Jeff Hosenbball, Ted F, Andrew Loto um some of which have worked at Airbnb. Airbnb had tried experiences from 2015 onwards. They had failed. They had seen Get Your Guide as being you know clearly the innovation leader in the space and you know they were like this is a big market. We just raised this massive vision fund. Let's put some dollars behind it and make that market a reality. And to be honest, the vision fund in a way actually did do that. So, so with that funding, our market, you know, went onto like a completely different stratosphere and we had the How did those meetings go? People often talk about Source Bank where it's like 500 million in 30 minutes. Was that how it went? What was the experience like?

It was not with us. I think that group of people um which was doing marketplace investments at the time out of San Francisco. They invested in Door Dash, they invested in Get Your Guide, they were much more like traditional growth equity investors who are very metrics oriented. It was a very deep diligence process and ultimately while I did get to meet Masa, you know, he was just one meeting uh you know along the the road of raising that investment, it was very much a growth equity investment process. So there was nothing crazy about it.

I was very nervous. Yeah, of course, because he could have just, you know, put his thumb down. We just worked on this investment for, you know, half a year and, you know, this meeting of like 1 hour determines whether you get it or not, right? And but Masa was very friendly person. He's Japanese so you know he's um in a way very calm and he's very gentle and he was very interested actually in the P&L surprisingly. So he was literally looking at okay how do we value this business you know how can this be very profitable over time. So with marketplace investments I think he's much more financially oriented than with the deep tech stuff. So he's really going deep there, surprisingly deep. And he's actually really good at this. So I was surprised because, you know, you have these stories of Masa that he's just this crazy person, but he's actually a really good financial investor as well. So that knowed by like all of the headlines, he knows what he's doing. The second part of the meeting, you know, apart from like the financial traction, the KPIs and like P&L and all of that was really about the product vision itself. And to give him credit um he was already completely on to AI in 2019. So he was like how is AI going to transform this? You know how do you think about the UX of the future? You know how can you build an an app that is much more personalized, much more engaging? How can you embed um you know virtual reality uh in there um you know for instance finding the meeting points or you know even like being in the Louver like you know how can that trans experience transform. So he is really very visionary and at the same time very grounded in the financials both of it.

Yeah pretty much you know we like this you know let's go and make it out. How how big was that? Between Soft Bank Vision Fund and Timas we raised an aggregate of uh roughly $450 million uh dollars at the time. We did take some of that capital to buy out earlier shareholders. So, not all of that was primary.

For us, uh, it was the decision that ultimately made Get Your Guide into what it is today because just 6 months after we raised that money, CO hit. So, we would be bankrupt without that round.

I think that was at the time 1.5 1.6 billion. Did Did you feel the weight of that at that point? 1.5 1.6 or No, not really to be honest. Um at that time I was already um so used to tremendous amounts of pressure and you know being at the helm of this company. What what did change was that suddenly I felt like a celebrity. um you know it was like you're going into rooms like everyone was trying to please you know it's like you know everyone wanted to do business with you all of like you know the VPs of like the Googles and matters like we're calling me up and you know all of the VCs in the world wanted to have a meeting and were suddenly speaking of you as as if you were like the greatest and like smartest person on the planet. That's when I do you believe the hype?

to be honest um I had too little time to really reflect on that because 6 months later we were managing the biggest crisis uh in the history of online travel. So that was such a brief honeymoon period that to me it was very surreal uh looking back. Um but I actually did learn the hard way that when you're down then none of these people call.

So in February um 2020 we have this board meeting with SoftBank uh Timasc obviously you know Asian funds um and they're already seeing what's going on in Asia where you have lockdowns and everything and they were saying you know we better build some contingency plans you know if this actually spreads to Europe and the US and you know the naive like you know still very gung-ho founders that we were we said you know look we've managed crisises before we've had the butterclaw attacks in Paris in 2015 which hit us hard you know we we managed to survive and all of that. We're going to manage. Famous last words. It took three weeks from that board meeting uh to us being at zero revenues. Literally zero. Like I was going on the website weeks. I think there was like maybe 15 bookings a day down from like know tens of thousands. There was no one on our website. I looked at Google Analytics. It was just really no one. It was just no traffic. You know you we we had you know 600 700 employees. We had no revenue. What do you do? That's a really good question. Like you get in a room with town and go, "Fuck." I mean, the closest I can describe to the feeling that I had was like having a car crash on the highway at like 100 miles an hour just straight on hitting a wall basically. So, I was like, you're almost like, "My analytics must be broken." I was like, for for like two or three days, I I felt like this is surreal. This can't happen. This can't happen to me. I did this for more than a decade and and this is just not right. I felt like no, the world is not right. There's something wrong in the world right now. But then I quickly turned into um a mode that in retrospect I describe as being the surgeon. Um so I tried to put myself out of outside of the car and the car accident just said, "Okay, everything is broken. Like the car is completely destroyed. The patient needs to survive. I need to help the patient survive." So I put my strategy hat on and thought about you know what are the potential scenarios that we have from here and how am I going to survive and not only survive but also thrive after this crisis. And the good thing was I had you know a lot of cash on the bank. Um the bad thing was I had a lot of investors who basically called me up and said you have to lay off the entire company immediately to save all of the dollars you have on the balance sheet and then afterwards we'll rebuild. you know with these different pieces of information I needed to build a picture of what the right solution was for get your guide at the time and you know to Neil's the CFO and I we all huddled in a room for multiple days to work out that crisis plan in hindsight thankfully I think we made all of the right moves at the time which was number one not to listen to the investors who wanted to lay off the entire company but to rather focus on different scenarios of how long this crisis could take and then how we could build a company that is actually prepared for the rebound because already in March 2020 we felt that this is a massive crisis but there's also a tremendous opportunity in here. We have the cash on the bank. So if we are the first ones out of the gates afterwards if we do really well by our suppliers in the interim and we help help them survive as well. if we're really agile, if we continue to build our product, you know, we could be a much better company actually coming out of this pandemic than going in. And that was really the mindset that we took. That same week, I sent an email to the entire staff and I told them about something that I had learned um you know, a year, two years earlier when I did a tour with my wife Anakah through Seoia National Park. And one of the interesting things about the big sea trees uh is that they actually grow after wildfires. So when the park is devastated, the biggest trees grow because um they have the nutrient-rich soil after wildfire and they have full exposure to the sun. And I said, I want to be that sequoia after the co crisis. So let's build that sequoia now.

So we um did a couple of like very extraordinary measures. First of all, we came back with that vision and that target picture to our entire organization and particularly the engineering and product or which is the majority of our expenses on on the people's side and we told them we would love for you to reduce your salary but we'll give you shares as a compensation. So if this actually works out financially it will be great for you. Um but you'll need to take the short-term hit. And what happened was magical. Um our product and organization and and even beyond that into management functions. People on average reduced their salaries by more than 30%. In exchange for shares some people went down to like 80% salary reduction in in leadership. I kid you not. It was crazy. It was such a testament um to their belief in in the company. And then for a lot of the other operational staff there was um uh these shorttime labor you know things in Germany and elsewhere where

You know, the government would actually cover some of the cost. With these types of measures, we could go very deep into the pandemic and only had to cut marginally. We ultimately laid off roughly 15 to 20% of staff over two years. Not a single engineer or product person, despite being at zero revenues for more than a year.

We start to see borders open up and the world come back. In Europe, it was a disaster for two years—spikes of domestic bookings, hope coming back. That was the hardest part: hope coming back, wanting to energize the company but not give false hope. 2021 was slightly better because the US domestic market was robust, but we were still 50% below 2019 and burning cash.

It goes back to the lesson of 2013. I was so opinionated and straight about the path we were going up. The entire company was behind me. People sacrificed more than 30% of their salary. Not a single senior leader left. They trusted me. At the same time, I cut expenses wherever I could—in territories where we felt CO wasn't coming back, we cut people and unnecessary SaaS contracts. They saw that and rallied behind the plan. We had alternative plans if things lasted longer, but I said this is the plan we're going to follow.

To be honest, we did all the right moves during COVID in hindsight. A lot of it was luck. The recovery after the delta virus in early 2022 was benign—people stormed back to travel. We had kept all supply and struck better deals with suppliers during the pandemic. Everyone switched to online channels. Having rebuilt the product, fine-tuned kinks, streamlined supply, we came back insanely fast.

We went from late 2021 to March 2022 and grew 10x. It was crazy. In all of 2022, we doubled pre-pandemic volumes.

In 2022, we were double 2019 levels. 2021 was still half of 2019.