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CEOs, Corp. Development

Why Two Physicists Started a Hospitality Company — and Why They Decided to Sell

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Des O’Mahony, CEO and co-founder of hotel booking company Bookassist, was finishing a PhD. in physics in the mid-90s when he and a fellow doctoral student, Robert Whittle, decided to start up a series of city guides on the internet, akin to Lonely Planet travel guides. “The web had really just started. It wasn’t that popular. We set up the websites largely as a hobby,” says Des. The two set up a guide for Dublin, where they were based, as well as a number of cities across Europe.

The traffic on the sites continued to increase. “Then we realized that almost half of the queries we were getting on those sites were people asking our advice on where to stay. We thought — there’s a business model here. We need to put hotels directly in touch with these people.”

In 1999, Bookassist was founded to do just that. They went live in the Irish marketplace in mid-2000. “The two of us were physicists who really knew nothing about the hotel industry, so the first step was to source a couple of people with more knowledge in that area,” says Des. “There weren’t that many customers looking online for hotels at that time. But over time we took a market-leading position.” 

As the web grew more mainstream, business took off. “By the early 2000s, we started to add additional services like web design and digital marketing in addition to our booking engine. We became much more of a strategic partner for our clients rather than just a software provider,” says Des.

In 2016, Bookassist began looking for an outside partner to provide additional capital as well as financial and operational expertise.

Finding the Right Fit

At the time, Bookassist was thriving. They had expanded from Dublin to Madrid, Rome, Vienna, and Prague. Still, Des knew that the business had some core problems that needed solving — and he also knew he couldn’t do so alone. “We had gotten to the point where we did not have strong financial strategy or operational expertise. I was well aware of the weaknesses in the business and equally aware that if they were resolved, the company could really fly.”

“I was well aware of the weaknesses in the business and equally aware that if they were resolved, the company could really fly.”

The solution seemed clear: the business needed a partner. Des turned to an investment banker to help prepare the company to go to market and locate potential acquirers or investors who could fill some of these strategic gaps. Until that point, the company had been self-funded. (They’d considered raising money back in 2007, but hit the brakes when the recession hit.)

At the same time, Jonas Software, which operates more than 70+ independently managed software companies worldwide, happened to follow up with Des on a conversation they’d had a year or so earlier, which at the time hadn’t progressed. However, given Bookassist’s current focus, the opportunity was immediately exciting. “We’d had a number of offers or potential scenarios where our company could be merged with someone else. But in all of those, I didn’t necessarily see a role for myself,” says Des. He was also worried about his team in those scenarios. “We have a good ethos here, and a very loyal and solid team. I felt there was a strong possibility that our team would be easily discarded.”

Jonas, on the other hand, offered an opportunity for Des to continue to manage the business, but with the support of an outside partner with extensive experience in the software space. Jonas has a unique buy-and-hold-forever strategy — they’ve never sold a business — which meshed well with Des’ vision for the company and his team. The deal closed at the end of 2017.

Gaining Outside Perspective

Immediately post-acquisition, Jonas brought on a COO, Alan Threadgold, an experienced operator who had worked with Jonas previously, to work alongside Des. “He’s been assessing the structure of the business and is beginning to implement changes in the marketing and sales area. It’s allowed me to focus much more strongly on the product area, which is where I wanted to be, and to be less distracted by the operational and financial areas, which is not my thing. It’s really helped change the momentum of the company,” says Des.

But perhaps the most impactful result of the acquisition to date has been the insight Des and his team have garnered from their new “sister companies,” i.e., the other Jonas Software holdings. Des immediately met with various heads of business at a conference in Toronto in January, and since then has had ongoing meetings with other UK-based Jonas companies. “That kind of constant interaction with people who are often running quite different companies, but using the same fundamental principles, has been very valuable. It’s helped us understand how other people solve similar issues, how they get organized, how they move past particular challenges, and more. I’m able to tap into expertise that I would never get as a stand-alone company,” he says.

When Des first announced the acquisition, there was a certain amount of fear and uncertainty among the Bookassist team. Employees worried about job security and potential restructurings. He visited each office in person, and was careful to communicate clearly the fact that his role had not changed. Ultimately, the acquisition has actually led to increased headcount in certain areas, and provided additional staff training opportunities that Bookassist would not have been able to offer as an independent company. “Jonas’s emphasis on employee well-being has absolutely proven true. They’re not just paying lip service to that idea, but they’re actually delivering on it,” says Des.

While the company strategy may evolve with Jonas on board, Des doesn’t see the culture of the organization changing. Bookassist now has almost 100 employees. “We started out as a small company. We always treated it kind of like a family,” Des says. “I still know everyone’s name and what they’re up to. Sure, it gets more difficult. But it’s still very important. We have a relatively flat organization. As we moved into Jonas, it was clear that they believe too that everyone has a voice, everyone contributes. That philosophy aligns exactly with who Bookassist is.”

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