Last updated on May 18th, 2013 at 01:22 pm
Last night I received an email from award flight search engine MileWise that caught me by surprise: the company was acquired by Yahoo!. Here is that surprising note from MileWise to their users.
But this isn’t the type of acquisition you might be thinking. Yahoo! didn’t appear to acquire the company for their technology, because they immediately shut down the service. In fact, if you visit MileWise.com today, you will see a note about the acquisition, but no application.
In addition to the application being shut down, users must export their data from the system within the next two weeks before it is destroyed. Not a lot of time to act if you were a core user of the service.
Personally, I had only just signed up for MileWise when I saw that they were the winners of the first ever LaunchPoint competition last year. I found the service to be beautiful aesthetically, but not practical for me to use for my flight searches. It had a lot of good information, but not enough specifics on mileage redemptions to give me a fair comparison.
What really impressed me about the service, though, was the beauty of what they created and the ease of use of the product. That is not something that you often see in applications, so this is likely why Yahoo! jumped at the opportunity to add the MileWise team to their staff. It’s a very savvy move by Yahoo! to acqui-hire this team and fold them into their other products.
For those of you who may not be familiar with the term Acqui-Hire, it is essentially when a technology company is bought by a larger company for the team of engineers who built the product, and not the product itself. In most of these cases, they shut down the technology and have the team work on other aspects of their business. This is often like a very large signing bonus for the engineers, and is also a winning situation for the acquiring company. The big losers in these situations are usually the investors, because they often either lose money on their investment or only gain modest amounts.
In this case, it is said by Tech Crunch that MileWise had received $1.5 million in angel investment to date and the acquisition brought a modest return to the investors. That’s certainly better than losing money, but I can see how they would be disappointed.
From one perspective, I am happy for the team. On the other hand, I am disappointed that a promising travel technology company was acquired only to be shut down immediately. That is a loss for frequent travelers like myself. I can only hope that Free World Traveler can fill some of the void left by MileWise.
It sounds as if the MileWise team will be working on mobile apps within Yahoo! and that they will be based in their New York City office. Not a bad gig for Nicholas, Vinay and Sanjay. Best of luck and may more great tools emerge to fill the void.
