The $10 million investment provides critical “growth stage” funding for the online marketplace and referral site to offer new products, hire more employees, and pursue a wider share of the global chauffeured transportation sector.
SAN FRANCISCO — The world’s top online generator of chauffeured vehicle ride leads officially entered a new phase of development Tuesday with an injection of capital that will propel it toward new innovations and clients.
AUSTIN VENTURES, a venture capital firm based in Austin, Texas, has invested $10 million in a deal that makes the firm a minority-stake owner. Austin Ventures partners Mike Dodd and John Thornton will join the Limos.com board.
Exact terms of the deal, along with Limos.com annual revenues, were not disclosed. Existing shareholders, which include company founders and current executives, retain majority ownership.
This is the second major capital investment for LIMOS.COM, which was founded in 2007 by former Hotwire.com employees. It previously had raised $5 million in funding from private equity firm CANAL PARTNERS of Scottsdale, Ariz.
“The [limo] industry got blindsided by the same financial crisis that hit a lot of industries,” said Doug Anderson, vice president and a founder of Limos.com. “The recovery we’re seeing now is the seeds of a transformation for the industry, and that’s what we’re betting on. Car and limo service will become more accessible to consumers and to the benefit of suppliers and operators.”
Anderson described a four-fold purpose for the new funding:
1) Boost marketing services of Limos.com to help generate more demand for rides among its members.
2) Launch new products such as an entire mobile-only level of Limos.com service that can be exclusively accessed via laptops, smart phones, and tablet-style computers.
3) Hire more employees, especially affiliate managers and call staff to handle more clients and spend more time with them. “Most important to us are the people we care about the most, operators and customers,” Anderson said. “We will be investing in both sides of that. We want to reduce the number of operators that each of our affiliate manages have to take care of, so they can spend more time with each operator.”
4) Start scaling up for growth among operators outside of North America so Limos.com can build an active global service network.
As of this month, Limos.com has about 2,000 operator clients, up from 1,500 in January 2010. About 250 of those operators are based outside the U.S. Upcoming LCT Fact Book numbers show the industry has about 8,700 operators. The latest figures also reveal that 48% of the chauffeured transportation industry uses an online lead generation service, such as Limos.com.
As part of its growth, Limos.com during the past year formed alliances with OpenTable.com, a restaurant reservation site, and Ticketmaster.com, which sells concert tickets. Users of those two services can get easy access to limousine bookings through Limos.com.
The Limos.com business model is based on enrolling pre-screened limousine operators in all markets nationwide that are covered by $10 million in insurance. It also has launched its FORGROUND.COM service geared toward corporate travel bookings.
Limos.com is three weeks away from activating its mobile application, which will enable chauffeurs and clients to instantly spot each other via GPS on smart phones. The LIMOS.COM MOBILE APP WAS UNVEILED AT THE 2011 ILCT SHOW in February.
Sources: Martin Romjue, LCT editor; www.venturebeat.com