SideStep - "He Gone"

OK – we’ll interrupt our holiday festivities and comment on the Kayak / SideStep “Merger”. There are a lot of tidbits coming through so we thought we’d throw in a few cents from the FMV point of view:

First of all – Reports say that Kayak will only hire 20 of the company’s 75 employees, not including its chief executive, Rob Solomon.

Wow, nice timing on that one Kayak – right before the holidays. Merry Christmas SideStep – now you guys can include a resume in your holiday cards you’re sending out!! Try this on your next search site: From: Santa, To: Kayak, and you'll get a big lump of coal in all of your results.

Second , Kayak raked in $196 million in VC money to be able to pull this “Merger”.

FMV puts the word “Merger” in quotes (insert air finger motion here) simply because we always thought that the larger company buying out a smaller company was called a “Takeover” or "Buyout" – but it’s obvious we’re not finance guys…

Third, the financing round was led by prior investor Sequoia Capital – and also included General Catalyst Partners, Accel Partners, Norwest Venture Partners, Trident Capital, Oak Investment Partners and Lehman Brothers Venture Partners, Silicon Valley Bank and Gold Hill Capital.

We guess $196 million is a lot of money so you need a lot of players.. FMV thought about joining in as well, but Kayak called saying they were drawing a hard line at $196 million and therefore they didn’t need our extra $250 to pull off the round…

Fourth, Kayak says there is less than 10% overlap among Kayak and SideStep users. (subscription needed)

This one actually caught us a little off-guard. We're told time and time again “There is NO loyalty in the airline search market, people always check multiple sites”. But now we’re told that tens of millions of searchers have a very strong loyalty to their preferred meta-searcher and don’t cross check? Or maybe because people don't know more than one? Whatever the case - seems like a weird fact.

Finally - Kayak co-founder and CTO Paul English added: “As a native Bostonian, I am also personally gratified to finally see an East Coast technology firm purchasing a West Coast counterpart.”

OH YEAH BABY – IT’S ON !! West Coast Sucks !! It's like the rapper wars again - Biggie and Puff can take down Snoop Dog and 2PAC ANY DAY ! Don't bring your weak stuff in our house Silicon Valley !

Man, where did this quote come from?

Overall – interesting stuff. We always thought that a few of these guys would get taken out, we just didn’t look at them “Merging” with each other. If the 10% overlap part is true - nice play for Kayak on simply shortcutting the process and ramping up their scale.

It’ll also be interesting to see what happens now with FareCast and Mobissimo - will others just look at these companies and think that they can get in the market now on the cheap(er)? Although we think Mobissmo has a long long way to go.