Hipmunk Raises $20M Round For Its Agony- And Ecstasy-Based Travel Search

Flight and hotel search startup Hipmunk is announcing that it has raised $20 million in Series C funding.

The round was led by Oak Investment Partners. Hipmunk co-founder and CEO Adam Goldstein told me that he’d been looking to raise money from a firm that had experience in consumer travel, and Oak fit that description because it previously backed flight search service Kayak. Oak general partner Ren Riley is joining Hipmunk’s board of directors.

Founded in 2010 by Goldstein and CTO Steve Huffman (who also co-founded Reddit), Hipmunk quickly became my flight search engine of choice, and not just because the company’s chipmunk logo/mascot is ridiculously cute. Instead of giving users a long list of options, Hipmunk presents them with a colorful grid, and instead of focusing on price, it also allows users to sort results based on “agony” (which combines price, flight duration, and number of layovers).

The Y Combinator-incubated company quickly added a hotel search, which used a similar sorting principle, except this time it was “ecstasy” instead of “agony.”

Over time, Goldstein said Hipmunk developed another big selling point — comprehensiveness.

“When we first launched, I’ll admit we did not have the most comprehensive selection,” he said. However, that’s changed as Hipmunk developed relationships with airlines, travel agencies, and even Airbnb and Homeaway.

Yesterday, Goldstein reiterated a point he made last year, namely that even though Hipmunk has no plans to abandon travel search, hotels have become its priority, in part because hotel search is more lucrative. That part of the business has been “growing like a rocketship,” he said, with mobile hotel bookings up 6x year-over-year.

More recent additions to the product include same-day hotel booking and improved cross-platform features. Goldstein said cross-platform continues to be a big priority — not just making sure Hipmunk has options on multiple platforms, but also allowing users to start a search on their phone and then complete it on their laptop, or vice versa.

“We’re not done with new verticals,” he added. “We’ll add cars [i.e., car rentals] and other stuff, but we’re not done with flight or hotels, either. We’ll keep … trying to make that experience as low friction as possible.”

Existing investors Institutional Venture Partners and Ignition Partners also participated in the new funding, as did Hipmunk’s angel investors. This basically doubles the amount of funding that the company has raised, bringing the total to $40 million.