Cottage Grove HQ TravelNet Solutions is crossing the $15m revenue milestone and 100 employee mark right about now.
Far from an overnight success, TravelNet actually began almost 20 years ago, when brothers Charles and Ryan Bailey first teamed up on tech for real estate rental property owners.
TravelNet today is mostly known in the hotel and hospitality space for brands like resortsandlodges.com, or TRACK Hospitality Software – a product they bought four years ago that would change their trajectory.
And to top if off, TravelNet has resisted the inclination to raise institutional venture capital – so far at least.
Here’s what Cofounder and CEO Ryan Bailey says about where TravelNet is at at these days and where he sees things headed:
For those unfamiliar, what is TravelNet Solutions?
TravelNet is the parent to a portfolio of different product and brands – resortsandlodges.com, TRACK, and TCommerce – that provide integrated solutions for the hospitality industry. So when we are working with customers we can offer CRM, contact center, ERP, professional services, , and digital marketing, etc.
Who do you sell to, what type of clients?
From independent properties into the enterprise organizations. into the top 10 hotel management chains. We have over 2,000 different customers right now.
How are things going?
The business has been good to us. We had another record year in 2018, going on four years and counting.
We also recently rebranded, added some senior executives and opened new office this year in Florida.
What are goals for the next phase?
Our goals goal over the next 5-8 years is to hire amazing people and reach $100m/year revenues.
How have you financed growth so far?
We raised $750k back when we bought TRACK software…which we realized was like nothing for the enterprise level we were playing on. From there, it’s all been self-funded into the tens of millions – a lot of pounding the pavement, and patience.
Why not raise more investment capital?
We’ve come close…it came down to the 11th hour actually, but I realized that we had the cash on our balance sheet and was willing to take the risk on. Why give up the equity if you don’t have to, really? Why change your cap table if you don’t have to, really?
I think that it’s necessary to be thoughtful and conservative when deploying capital…and with someone else’s money you have that pressure and it can be a vicious cycle in terms of additional ongoing rounds.
I don’t know, maybe if we had raised the money then we’d already be a $100m company…I could go back and forth forever, but that’s the decision we made so far. I wouldn’t say never, but we’re content on going to the next level on our own dime at this point.
Do you have interest in making acquisitions?
We will definitely grow organically, but yes, we do have an acquisition strategy.
What do you think about the notion of an exit for your company?
Obviously private equity is a hot space all around, and there are some firms doing rollups right now within the hospitality industry. So do you go that direction or double, triple down on your own?
We have a great balance sheet and have never raised any institutional capital; it took a lot of work just to get here and it’s been a lot of challenge and fun.
That said, we could have sold out already a few times over, but I’ve always been all in on this company and for the long haul. To build a solid standing profitable technology company, and the path to one day take the company public – that’s the dream.
What are company revenues like nowadays?
Combined, we’re pushing $15m gross this year, 2019; our goal is to break through $20m in 2020.
What is your fastest growing segment?
Our business solutions and our proprietary software are neck and neck.
How many people overall work across TravelNet Solutions?
93+ mostly in Minnesota though our team is becoming more distributed.
And your headquarters is still in Cottage Grove?
Yes, but the building we are in currently is actually for sale and we are now deciding where we want to relocate in order to handle the team growth.
Where you want to land?
East side – St. Paul / Woodbury / Eagan / Mendota Heights.
Who is on the board of the company today?
What’s been a recent learning experience for you, as the CEO of TravelNet Solutions?
I thought it would get easier when we got to five million…then ten million…but it doesn’t get any easier, it’s just different. Hiring the next group of leaders to help us scale is crucial. And I probably hired for ‘head of people’ a couple years too late…it all comes down to your people, I’m learning.
What inspires you to do what you do?
I think my intentions when we started vs. where they are today are radically different. Back in my early 20’s when I started in business my motivation was more financial…but I learned that was like chasing the wind. Today, I enjoy trying to get better at leading people and serving customers. Being rich within my family, and those around me is where the meaning lies.
Does anything concern you, keep you up at night?
Losing great customers and great people. There’s so many rock solid companies out there and cool things going on in the world, it’s impossible not to keep me up at night. Probably on my mind more than I’d like to admit.
Is there anything else you would like to add?
Take care of your customers, take care of your employees.