Berlin-based GoEuro is proving that a European-focused company can still draw top investors from Silicon Valley.
The conventional wisdom across Europe these days is that entrepreneurs need to be thinking globally right from the start. But GoEuro, which operates only in Europe, as its name implies, announced today that it had raised $70 million in a round led by Silver Lake Kraftwerk, a fund operated by Silicon Valley’s Silver Lake, and Kleiner Perkins Caufield & Byers.
This follows another round of $45 million the company raised last December, bringing its total to $145 million.
“Investors look for a few key ingredients,” said Naren Shaam, CEO and founder of GoEuro. “European travel is a 50 billion dollar market and it’s still mostly offline. So you can create a very large consumer brand here.”
GoEuro was founded in 2012, though the service did not actually launch until the following year. The company allows consumers to book travel through the patchwork of trains, buses, and local transportation that stretches across the continent. The company has 500 transportation partners in 12 countries.
That may not sound like much on the surface, but in fact signing up each partner and connecting their disparate systems is a huge logistical and technical challenge. Each national rail partnership can take as much as a year to negotiate. And maintaining all the data across those platforms in a unified format is a big engineering challenge.
Shaam noted that 80 percent of rail tickets are still purchased at railway stations. With 500 million travelers per year, the opportunity for a company solely focused on Europe is immense.
“In just three years, GoEuro has built a truly differentiated technology platform that allows true multi-modal comparison of rail, coach and air across Europe,” said Bryce Lee, managing director of Silver Lake Kraftwerk, in a statement. “We believe GoEuro has a clear opportunity to be the leading travel platform in this nascent market that today is still predominantly offline.”
GoEuro currently has 180 employees, of which 46 percent are women. Shaam said the company will continue to hire and will also use the money to continue adding countries and to greatly improve its mobile experience. He said that 70 percent of the company’s 10 million monthly users are on mobile platforms, but he still wants to make the buying experience better to attract more of those offline ticket buyers.
Looking down the road, Shaam said he’s not sure the service would make sense in the U.S., where rail and bus travel are not as popular. But he said South America and Asia markets could be inviting targets, eventually.
The company did not release a valuation but said in its press release: “GoEuro is now poised to join the small circle of European start-ups seen to have the potential to become multi-billion dollar companies.” Other investors in this round include Atomico, Battery Ventures, Goldman Sachs Investment Partners, Lakestar, and NEA.
“I’m happy they’re making this bet in Europe,” Shaam said. “Because I believe that Europe can create many $10 billion-plus businesses.”