WAYN said to be close to sale. The price? $200m. The buyer? AOL

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Social travel site WAYN is allegedly in talks with AOL over a possible $200m sale to the consumer portal giant. A spokesperson for the UK startup denied that any sale talks are taking place. However, I have tonight spoken to three well-placed sources who have all independently quoted the $200m figure to me, and named AOL as the prospective buyer.

In a phone call tonight Anika Erskine, WAYN’s marketing manager, told me: “We are absolutely not for sale. We’re not considering it at the moment. We’re excited about what we’ve done and the partnerships we’ve signed. We’ve just launched a new version of our travel guides, with tonnes of content and new services. We’re very much pushing down that route – cutting edge mobile services, UK focused and rolling out across other countries.”

But the fact that no deal has been announced yet is put down by my sources to delicate negotiations around a generous earn-out clause proposed by the founders. And the signs are that this is proving to be a sticking point in negotiations. The site is only on course to bring in $4.5m of revenues this year, a figure which contrasts markedly with the exit price.

If the deal goes through it would rank amongst the biggest sales of a UK social networking startup yet, and a healthy payday for founders Jerome Touze (CEO), Peter Ward and CTO Mike Lines (who runs the 35-strong technical department in Poland). Last year US media giant CBS bought UK social music site Last.fm for $280m. WAYN is one of the fastest growing travel and lifestyle social networking community sites in the UK and has a footprint in over 220 countries, with over nine million members.

WAYN’s investors would also be pretty happy. In 2006 the site received $11m in funding, including money from Brent Hoberman, co-founder of budget travel website Lastminute.com. The round was led by DFJ Esprit, and other investors included Adrian Critchlow and Andy Phillipps, co-founders of Active Hotels; David Soskin, CEO, and Hugo Burge, co-founder of Cheapflights; Steve Pankhurst, co-founder of Friends Reunited; and Constant Tedder, co-founder of Jagex, which runs RuneScape, the UK’s largest online multi-player game. (Burge also runs HOWZAT Media, the investment fund which invested in TrustedPlaces). WAYN originally launched in 2002, but attracted a limited amount of interest until its funding round.

Traffic, after dipping mid-way last year, appears to have surged since the site took off subscription locks which had clearly acted on a block to growth. WAYN members create a profile, log their past, present and future trips, and can find other members based on location. They can set up shopping lists, upload photos, videos, email IM, and SMS. The site is strong amongst the 18 to 25 range.

But sources I spoke to in the investment community aren’t leaping for joy at the rumour. One source told me they “wouldn’t be very happy” if this deal went through on the basis that the site was a “me too” and “not very sticky”. Although established early in 2002, WAYN does resemble a number of similar social networks around travel, among them the US-based RealTravel.

Some might say lead investor DFJ Esprit is keen to realise its investment sooner rather than later. Key partner there Nic Brisbourne blogged in October last year that WAYN would most likely be sold to a big company which wanted to enter a vertical sector like travel:

“…the margin between overpaying today and missing the next big thing is razor thin. This puts big companies in a very difficult place – and some will respond by moving more aggressively to acquire companies earlier and/or at higher valuations. The same valuation/acquisition logic that applies for Microsoft and Facebook applies for acquirers and internet companies for whom exits in the hundreds of millions of dollars are a big deal – particularly in specific verticals like music and travel. CBS acquired LastFM at lofty multiples for this reason and the same thinking was behind our exit analysis when we invested in WAYN.”

Any acquirer of WAYN will be looking to capitalise on existing growth and WAYN has signed a number of deals in the last year in order to power this. Among them was a deal with affiliate marketing network Buy.at to allow users to make money through their profiles by displaying products they want to recommend to friends, thus earning a commission.

  • http://www.antonmannering.com Anton Mannering

    I’ve tracked WAYN and it’s a nice service but I’m sorry it really is limited and I think this is a huge overestimation of the value.
    Of course there may be things I’m not aware of but in it’s current incarnation it needs quite a few things to make it really work.
    Fair play to the guys at WAYN if they can get this kind of valuation though. I’m just jealous anyway…

    • Clare

      We like this site but feel it does limit its market for the future. Not taking anything away from them at all, they are doing extremely well.

      Our site will launch over the comming months and believe it will show the future of social networking to a vast more broader audience. We are start up funded and hope to be an up and comming leader in many social enviroments.

      More information can be obtained by reply.

  • http://www.techcrunch.com/2008/01/16/aol-rumored-to-be-in-talks-to-buy-uk-social-travel-site-wayn-for-200-million/ AOL Rumored To Be In Talks To Buy UK Social Travel Site WAYN For $200 Million

    […] UK has the scoop: Social travel site WAYN is allegedly in talks with AOL over a possible $200m sale to the consumer […]

  • http://www.exiva.com Nick Wright

    Good luck to all concerned!
    When we conceive, create and publish our ideas online we all want (without exception I would say) an exit on attractive multiples. It may not be the driving force but it is there nevertheless. Along with site statistics, it is the only measure by which we can judge how others see how successful our businesses are.
    In addition, the founders can reward themselves for their endeavours and sacrifices; the VCs can set aside some of their profit to invest in yet more start-ups and other entrepreneurs can take inspiration.
    Everyone is a winner.

    exiva.com- share your life, treasure the privacy

  • http://fr.techcrunch.com/2008/01/17/aol-serait-sur-le-point-de-racheter-pour-200-millions-wayn-le-reseau-social-anglais-des-voyages/ TechCrunch en français » AOL serait sur le point de racheter pour $200 millions WAYN, le réseau social anglais des voyages

    […] UK nous révèle le scoop: “Le site social de voyage WAYN est en pourparlers avec AOL pour une possible vente de $200 […]

  • Lawrence Bradley

    WAYN is an interesting site and quite large from what I have seen – they have something like 6m visitors I think but what may make them an interesting proposition is their focus on travel which they are on they by far dominating compared to the likes of realtravel or other “metoo” travel social media propositions – good luck to them should this be true

  • http://www.wayn.com Annika Erskine - WAYN.com

    Further to the comments referred to in this article we would like to confirm that WAYN has at no point had discussions with AOL and are not currently looking for a strategic sale.

    WAYN is unique in that it is focused on the travel vertical which represents by far the largest and most lucrative sector online and we are excited about the new products we are introducing to our members and the prospect of developing into the mobile space with location based data and services being one of our core strengths. We benefit from a broad demographic with over 50% of our UK users over the age of 35. We are also one of the only social networks which is 18+ to improve the safety for our users.

    Our present focus is to create long term value and build a truly successful business. The WAYN vision is to become the world’s largest and most successful travel and lifestyle community portal and our management team is solely focused on achieving that goal.

    If there are any questions regarding this article in particular, the WAYN travel/lifestyle services or to receive information about future announcements from WAYN please contact +44 (0) 20 7336 8088 or annika.erskine@wayn.com.

  • Mike Butcher

    Thanks for your help on this Annika. You’ll note I carried WAYN’s position on the story, as you described it. My sources continue to tell me that sale talks are happening. As usual, stories like this may or may not come to fruition. I’m just here to report.

  • Marta

    WAYN is not selling anything. This is just a silly rumour created by someone who had no idea about the company. LOL

  • John

    I don’t think that this is true. I work closely in the social networking environment and don’t believe this story. WAYN is in a too good position to sell at this stage – this site is growing no point selling now.

  • Mike Butcher

    @John – That’s why a sale makes sense. No buyer is going to pick up something with no growth left in it. That really would be dumb, price aside.

  • http://www.trendcatching.com jamescoops

    I dont think the valuation is crazy – last.fm had no real business model – WAYN is right in the middle of the travel vertical = big £££

  • http://www.georgehopkin.com/?p=27 GeorgeHopkin.com » Blog Archive » WAYN said to be close to $200m sale?
  • http://www.broadstuff.com alan p

    @jamescoops – you advising the sell side then ;)

  • http://www.trendcatching.com jamescoops

    im afraid not – personal view – anything with good traffic in travel, financial services, recruitment, electronics is a great business

  • http://www.tourcms.com/blog/2008/01/17/wayn-will-aol-yes-no/ WAYN - Will AOL Yes No? (Musings on travel ecommerce)

    […] read last night about how WAYN (Where Are You Now) may be (may be) close to being sold to AOL for $USD 200 million […]

  • http://towerone.com/2008/01/18/wayn-aol-and-the-smell-of-cooking/ WAYN, AOL and the smell of cooking | TowerOne.com

    […] have arrived just in the nick of time in the form of AOL, the ‘portal’ people. They are reportedly in negotiations to buy WAYN for $200million. OK so I am being totally unfair to call the AOL […]

  • http://hotelandtravel.decasitodo.com.ar/wayn-what.htm WAYN What?

    […] TechCrunch UK has reported yesterday that WAYN was in talks with AOL for a possible sale of the travel social networking for an estimated £200M. […]

  • http://www.travels-hotel.com/?p=344 Travel-Hotel » WAYN What?

    […] TechCrunch UK has reported yesterday that WAYN was in talks with AOL for a possible sale of the travel social networking for an estimated £200M. […]

  • http://privatetravel.wordpress.com/2008/01/21/la-recommandation-de-voyageur-petit-tour-des-pratiques-existantes/ La recommandation de voyageur : Petit tour des pratiques existantes « Few post

    […] acquisition ou une nouvelle levée de fond est annoncée dans le secteur (la dernière est assez vertigineuse ) […]

  • http://www.7-24holiday.com/?p=27 Holiday and Travel Blog » WAYN What?

    […] TechCrunch UK has reported yesterday that WAYN was in talks with AOL for a possible sale of the travel social networking for an estimated £200M. […]

  • http://www.7-24holiday.com/?p=44 Holiday and Travel Blog » WAYN What?

    […] Annika Erskine – PR Manager for WAYN – has made a response here. […]

  • http://uk.techcrunch.com/2008/02/06/wayn-pimps-credit-card-to-users/ TechCrunch UK » Blog Archive » WAYN pimps credit card to users

    […] Meanwhile it looks like I was may have gone for the wrong startup when I wrote in January that AOL was about to buy WAYN. WAYN is backed by VCs DFJ Espirit, who also just sold buy.at to AOL. So it looks like either the […]

  • http://www.travels-hotel.com/?p=361 Travel-Hotel » WAYN What?

    […] Annika Erskine – PR Manager for WAYN – has made a response here. […]

  • http://www.7-24holiday.com/?p=78 Holiday and Travel Blog » Blog Archive » Forest - Dirty Practises in some hotels

    […] TechCrunch UK has reported yesterday that WAYN was in talks with AOL for a possible sale of the travel social networking for an estimated £200M. […]

  • http://www.7-24holiday.com/?p=85 Holiday and Travel Blog » Blog Archive » Forest

    […] TechCrunch UK has reported yesterday that WAYN was in talks with AOL for a possible sale of the travel social networking for an estimated £200M. […]

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