Yahoo nearing deal to buy travel rewards startup Milewise, according to sources
Yahoo is poised to acquire New York travel startup Milewise, according to people familiar with the deal. The deal is set to close this week, they said. Milewise was founded in 2010 to help consumers figure out their travel rewards programs through its web site and Android and iOS apps. The company and Yahoo didn't return requests for comment.
In early 2011, Milewise raised a $1.5 million seed round from Atlas Venture, Founder Collective, General Catalyst Partners, High Line Venture Partners, iNovia Capital and a long list of big name angel investors: David Cohen, Geoff Judge, Mitch Kapor, David Kidder, Josh Kushner, Alex Lloyd, Tom McInerney, Jacob Pechenik, Keith Rabois, Naval Ravikant, David Tisch and Kal Vepuri.
Self-dubbed "Mint + Kayak + Miles," the company consolidates and tracks loyalty rewards from programs like frequent flyer miles, hotel points and credit cards. The overall loyalty industry is big, worth some $50 billion annually. A number of small startups, including, Belly, LevelUp and Square are attempting to make the messy situation of managing rewards and loyalty points easier to navigate for consumers. Milewise focuses exclusively on travel rewards.
Why would Yahoo want a product like Milewise? Well, it has been on a buying spree of small startups, snapping up Stamped, Summly, and this week, Astrid, in an attempt to reinvigorate its company culture and image. Some commentators scoffed at Yahoo's $30 million price tag for Summly, considering the company's product will be killed. The price tag for Milewise was not clear. It's also not clear whether Yahoo will shut down the product.
What is clear is that Milewise fits into one of Yahoo CEO Marissa Mayer's key mantras: She wants users to interact with Yahoo on a daily basis. That's why she's purchased a task management app (Astrid), a social sharing app (Stamped), and a reading app (Summly). Travel plans and rewards tracking could be part of that suite of daily-use services, too. I'm guessing there are plenty of founders out there worried if their company will survive the dreaded Series A crunch. They might want to consider giving Yahoo a call.