Elia Wallen never expected this.
Wallen started Hotel Engine as a subsidiary of corporate housing company Travelers Haven in 2015, meeting a long-standing customer request—assistance with hotel bookings. Wallen founded Travelers Haven in 2008 (the company reached $100 million in revenue in 2022, and was acquired by Blueground in 2023). But over time, the Hotel Engine side project gained more and more traction, becoming impossible to ignore.
“As these stories sometimes go, the little brother became the big brother,” said Wallen. “You hear stories about these products that people build as little side things, then they grow—and that’s essentially what happened. So, I moved over to Hotel Engine full-time in February 2020. We raised our first money in the summer of 2019, and that was actually the first money I ever raised.”
Wallen’s gambit has paid off. The company today reached a massive milestone: Hotel Engine has raised a $140 million Series C led by Permira, Fortune can exclusively report. The funding bumps its valuation to $2.1 billion, up from $1.3 billion during the 2021 round. With new investment in hand, Hotel Engine will now expand beyond hotels, launching flight and rental car booking capabilities to its platform in October. The Denver-based company will accordingly change its name to reflect the wider focus, becoming Engine.
“We joke internally that whoever named this company wasn’t thinking big enough,” said Wallen. “Hotel Engine, when it was tucked under Travelers Haven, made all the sense in the world. I wasn’t considering that it would get this big, so the name change really goes along with that.”
And Engine has indeed grown, coming out on the other side of the pandemic profitable. The company is currently seeing revenue growth of 70% year over year and says it expects to book more than ten million room nights in 2024. Wallen is also eyeing areas of possible expansion once the company’s move into flights and rental cars is settled.
“Groups is one that I should touch on,” he told Fortune. “The group industry, it’s meetings, conferences, and events. It’s a very, very big space. It’s very broken and very manual. You’re planning a wedding, what do you do? You’re going to research a handful of hotels right near a venue, and maybe the venue is a hotel. Then, you’re literally going to pick up the phone. We have the most modern platform for that business. It’s growing very fast so we believe groups is going to be a very big opportunity.”
One of the most striking things about listening to Wallen is his exceedingly measured approach to raising capital. He tells me that, to date, Engine has spent less than half of the $56 million in primary funding the company raised before this new round.
“I don’t think companies should take money unless they really need it, unless there’s really product-market fit and you need it for scale,” Wallen said. “I think so many people do it for all the wrong reasons. They do it because they think they're supposed to. They do it for ego or pride… It’s just that we’re conditioned as entrepreneurs and there’s so much self-doubt out there—and it’s dangerous. But a lot of people want to do the right things, and they do it because they think it’s right.”
Then again, it’s perhaps not striking so much as consistent—that moderated approach has been a recurring theme for Wallen, who seems to operate sans Silicon Valley hype. That even goes back to the ways in which the success of Engine so far has been the byproduct of a happy accident, followed by execution and hard work.
“There was never a moment where I was thinking, ‘Oh, this is going to be huge,’” said Wallen. “We just kind of built it, and I even almost shut it down a few times, because Travelers Haven was already such a successful business and growing fast. You always hear ‘focus, focus, focus on where you put your time and energy’—but that’s where the outcomes will happen.”
Elsewhere… Luminate Capital, the software-focused fund from Hollie Haynes, has bought AbsenceSoft. Haynes is the well-known private equity executive who spent 15 years at Silver Lake before launching Luminate in 2015. AbsenceSoft is the first deal from Luminate's upcoming fund IV. My colleague Luisa Beltran has the news.
See you tomorrow,
Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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