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12. Kayak

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Estimated Value: $1 billion

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Business: Travel search site: search for cheapest fares, hotel rooms, cruises, etc.

Location: Norwalk, Connecticut

More Info: About Us

CEO: Steve Hafner

Investors:
General Catalyst, America Online, Sequoia Capital, Accel Partners.

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Analysis: Kayak was started by the founders of Orbitz, Travelocity and Expedia. Last December, the company raised a $196 million round to buy its rival Sidestep at a rumored price of between $150-180 million. At the time of the acquisition, Kayak CTO Paul English said that Kayak generated $50 million in revenue for 2007 and SideStep $35 million and that both companies are profitable.

Compete has a thorough breakdown of the two companies web traffic here. More recently, Microsoft bought Farecast, a Kayak competitor with 1/5th of Kayak's traffic for $115 million.

Kayak charges travel providers on a per-click basis (click on that American Airlines flight to London, and Kayak will send you to AA.com--in exchange for a click fee). This should be a high-margin business.

Assuming Kayak and SideStep continue to grow, the combined company should generate at least $100 million of revenue in 2008. We apply a multiple of 10X, to arrive at an estimated valuation of $1 billion.

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