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Skift Take
This is an example of why startup advisors say founders should avoid taking too much funding too quickly.
Culture Trip, the travel media company that raised roughly $155 million, sold its website and group tour business to the U.S. News & World Report.
Culture Trip has gone through several business initiatives. It most recently said it was focused on selling curated trips. It also had an app and said it had published thousands of destination guides and more than 90,000 pieces of travel content.
Terms of the acquisition were not disclosed.
The news is not a surprise. Culture Trip said last year that it was considering a full sale of the company and that it had completed a management buyout.
At the time, Skift CEO Rafat Ali posted his thoughts in a Skift blog post called, “CultureTrip Sold To CEO and Is Now Trying To Sell Itself After Failing At Everything Else.”
“With little to no brand value, any residual SEO value quickly deteriorating and little revenues to boast of, and likely being unprofitable as a business, it is hard to see any good outcomes from here,” Ali wrote.
U.S. News Travel publishes rankings and guides about travel destinations, as well as a search engine for flights and hotels. It also owns GoToSea, an online travel agency for cruises.
The website, TheCultureTrip.com, will maintain its brand as part of the U.S. News Travel business. U.S. News said it will also continue to operate Culture Trip’s small group tours.
The Rise and Fall of Culture Trip
Culture Trip company has said that it raised $155 million in equity in debt between 2016 and 2021, according to an annual report published with the UK government on Companies House.
By the end of 2022, the company had about $253,000 (£200,000) in the bank, a decrease of more than £3 million, and an operating loss of $29.6 million (£23.4 million), according to the filing. Its revenue for the year was £1.85 million.
The company had been experiencing ongoing losses and was planning to engage in “aggressive fundraising,” acknowledging that there was a “material uncertainty” of its future, according to a letter in the filing dated Dec. 6, 2023.
The money was spent toward the company’s product, technology, content maintenance, sales and marketing teams, and other activities, according to the filing.
The company had hired high-profile executives over the years to build an online travel agency. Andy Washington, who had worked at Expedia and Lastminute.com, was hired to lead that effort but lasted 16 months on the job.
Culture Trip said that it shifted from that effort to trip sales in early 2022. It cut 80% of its staff during the same year, according to the filing.
The company last year completed a management buyout led by CEO Ana Jakimovska and said it was considering a full sale of the company.
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