Booking.com with Jetsetter & Room 77 CEO Drew Patterson

The hosts describe Booking.com as a little-known company in the United States but a global travel giant. They cite a $91 billion market capitalization and compare its scale with Airbnb and Netflix. They bring in Drew Patterson, whose experience spans hotel distribution and pricing at Starwood, online travel marketing at Kayak, and leadership roles at Jetsetter and Room 77. The episode’s premise is that Booking’s success requires industry knowledge because the mechanics of online travel are not obvious from the headline acquisition alone.

Booking began in Amsterdam in 1996 after founder Geert-Jan Bruinsma noticed how difficult it was to reserve hotels across Europe by phone, especially when travelers and hotels did not share a language. He believed the internet could simplify the task and built an early multi-hotel booking site after studying Hilton’s online system. The hosts say the site initially attracted many Americans traveling in Europe, because consumer internet access was more widespread in the United States than in Europe at the time. Bruinsma reportedly raised about €50,000 by emailing roughly 50 people he knew had email; 18 invested.

Drew frames online travel agencies as marketplaces that must solve three problems: attract travelers, assemble hotel supply, and provide customer service. Early U.S. OTAs such as Expedia and Travelocity gained demand through prominent placements on portals like MSN, Yahoo, and AOL. On the supply side, they initially used global distribution systems (GDS), which had been built by airlines for travel agents. These systems supplied rates and availability, while the OTA website gave consumers a direct interface to search and book.