How Hipmunk Gained Traction As the Go-To Flight-Search Site

Whether you're the type who prefers the journey or kvells over the destination, there's a good chance the experience of booking travel leaves you feeling twitchy. In need of many a plane ticket to get to college debate tournaments, Adam Goldstein, a self-professed flight industry nerd who knows "the three-letter city codes for more places than I care to mention," often found himself frustrated by the booking process.

So Goldstein approached friend Steve Huffman, co-founder of reddit, about starting a company that would improve travel search. Even if they could just capture a small share of the travel market, the pair figured the company had big potential. Total U.S. spending on tourism during the fourth quarter of 2010 alone topped $1.4 trillion, according to the Bureau of Economic Analysis.

"That made it relatively easy for us to pitch this to investors," Goldstein says.

San Francisco-based Hipmunk launched its web-based flight search in August 2010, adding a hotel search and smartphone app earlier this year. The site displays the most relevant flight or hotel options on one page and makes it easy to understand the trade-offs of your choices, Goldstein says.

Users can search for flights by price, time, stops and flight duration. But what really makes Hipmunk a standout--aside from its ridiculously cute cartoon chipmunk logo--is its default search category: "agony," which factors in all of the traditional sorting options. As anybody who has ever booked a cheap flight with a longer-than-expected layover knows, price isn't everything.

Though "agony" as a search term could have left travel companies feeling a bit twitchy themselves, Goldstein believes Hipmunk does the airlines a great service.

"For years they've been complaining about convincing people that they should be shopping solely on price," he says. "Even if they don't like the name, I think they do like the concept, which is not having them seen as commodities."

Hipmunk gets a commission for leads it generates for the airlines or hotels. Goldstein won't release numbers but says Hipmunk is responsible for "millions of dollars" in bookings. Though Hipmunk's U.S. flight coverage has improved greatly since launch, Goldstein says the company is now considering improving international search and, eventually, car rentals, local deals and more.

"There is a huge range of things that competitors are--we think--doing a pretty bad job of," he says. "There is lots of opportunity to expand to a full-service travel search site."

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