Welcome to the Logan Bartlett Show.
Glenn and I have a great discussion about how booking has grown into a $170 billion plus business.
We talk about the challenges that they faced over the years, everything from tsunamis to wars, to a global pandemic, to post 9-11 and all the different things that have impacted travel over the course of the last 20 years.
We also talk about their acquisition strategy, including the acquisition of Bookingcom, which is now their namesake, and how it's grown into 90 of the revenue for the overall company.
Finally, we talk about how AI is going to impact travel, both from a user standpoint as well as for the business that is booking.
A great conversation with Glenn that you'll hear now.
Glenn, thanks for doing this.
Well, thanks for having me.
It's a pleasure.
Pleasure to connect.
I've studied your business and how you've built it out over the years.
So I have a bunch of different questions to go through.
But maybe for people that know some of your properties or know booking at a high level, can you get just a quick synopsis of what is booking and maybe how the business came together?
Sure, well, we could spend a lot of time or a little time.
Let me give you the brief one, then you can ask me questions that you want to get into details.
So Booking Holdings has a number of different brands.
Booking.com is by far the largest.
That's headquartered in Europe and Amsterdam.
In American viewers listeners, right now they know probably more often things like Priceline or Kayak or Open Table.
People in Asia would know things like Agoda.
If you rent a car, you may know RentalCarscom, though we've tried to merge that into Bookingcom mostly, but the brand still exists.
I mean, types in RentalCars.com are still going to be there.
And then a whole bunch of small things.
I won't go through all the detail.
We started off, though, as Priceline.com.
That was the start of the entire organization.
And then that was based just in the US and we wanted to become more international through a lot of details and mergers and acquisitions, et cetera.
We're now where we are, but by far.
Bookingcom roughly round off, call about 90 of the business, which is kind of interesting because we say wow, that means that put together open table and kayak and all the other ones that go to all their let.
And I say, yes.
And they said, that's weird.
I said, well, like today, right now, we're all. over $170 billion market cap.
So 10%, that's 17 billion.
Those are big companies, even though they're a small percentage.
Totally.
I mean, I guess it's a testament to the booking acquisition which I want to ask you about a little bit.
So Priceline was started in 99?
No, it went public in 99.
You know, 97 is pretty much where it really started getting, you know, some sales and such.
And you joined at what point?
I joined in February of 2000.
So that was about one week before the peak of the dot-com boom.
So, and I had been, I was a trader at Morgan Stanley.
And I always like to say that I top ticked that trade going long internet a week before the NASDAQ peak, which proved that I should leave my job as a trader Morgan Stanley because I clearly don't know how to trade.
The risk adjustment on that one.
Yeah.
Well, you know, if you're right over a long enough period of time.
Yeah.
Yeah.
Well, so I could say like, well, I was right.
I was just too early, which in the trading floor, that's another way to say I was wrong.
Yeah, wrong and early are the same.
But if you stay at a company long enough, things can prove out pretty beneficial.
I'm curious, what was the impetus or what made you jump on with Priceline?
What drew you there?
So I wasn't thrilled with what I was doing as a trader.
I was working for a Wall Street legend.
But to me, it just wasn't that interesting.
It was Barton Biggs.
And he was running about $16 billion.
And it was as a trader on a buy side all along, and really what I'm just trying to do is execute Barton's thoughts.
Well,
And I had previously had a number of different careers.
I had been an investment banker and my clients were airlines.
I knew a little bit about the airline business.
And before that, I had actually been an IT person.
I started my career in IT.
And so I had some knowledge about technology.
I had some knowledge about the airline industry.
I knew a little bit about trading, which didn't come that much.
And then this company, Priceline, was looking for somebody to be in charge of corporate development.
And it was...
Dot com.
Boom.
Everybody's Internet's going to go to the moon and it's 99.
So I interview and I get the job offer.
I said, OK, I just won't wait for my bonus.
Bonus could get paid in February and I'll leave and come over.
And I came over and like I said, like you said, you know, worked out in the end.
Totally, over a long enough period.
I mean, Priceline was one of the hottest internet stocks.
Oh, incredible.
It went public in 99, and that was before I joined.
But in a few days, it was worth $33 billion, which back then was real money, which is crazy.
And, you know, and then just to show how much things can change.
So during that first year, the stock dropped down to what was then a dollar a share.
We had to do a reverse split, which usually doesn't work out so well.
So we were doing you're giving in six to get one.
So call it six dollars a share, essentially.
My mother thought we were going to go bankrupt.
And then today we're trading, as of today, well over 5,000.
So we're talking well over 800 times.
So you do a CAGR.
So it's almost a quarter of a century and we're talking a CAGR.
That's over 30, over a 25-year period almost.
So it's really been something, really been a ride that's incredible.
But we went through, my Lord, we went through the dot-com implosion.
And then, of course, we had the great financial crisis.
I'll get through that one.
Well, you even had, after the dot-com, you had 9-11, right?
Well, 9-11, right.
As a travel business.
Forgot that one.
The good thing about 9-11 is that you get the experience of having negative revenue because more people are refunding than getting new revenue.
It prepared you for COVID.
Exactly.
That's the point.
And then we so after after we had the great financial crisis, we had the euro crisis.
Of course, that was big for us in Europe.
We had a couple of tsunamis, two tsunamis.
You had the one in the Indian Ocean was a bad one, the Christmas one.
Then you had the bad one in Japan that caused all that problem.
And of course, the volcano in Iceland that shut down travel in Europe for a while.
And as you point out, the pandemic, a few wars.
We were one of the biggest players in Russia.
We were the biggest player in Russia.
It's not that business.
So again, volatile industry, volatile industry.
But there's one thing, though, that is absolutely true.
And that is no matter how bad it may seem at the time, you know, travel is going to come back.
And would, I mean, travel slightly outpaces GDP because, maybe speak to some of the human.
Well, I mean, it's a couple of things.
You know, one of the things I would say, just as a human being desire to travel.
I think it's almost must be innate, or otherwise we'd all still be on the plains of africa because our species, at some point i want to see what's over the hill.
But when you look in just terms of today, you just look at economics, so We see that when somebody enters an income level where they can afford to travel, that's one of the first things they're going to do is go travel.
And then as people get wealthier, you end up buying more travel.
In fact, once you reach a certain level, well, you don't go buy another couch.
You go and travel more.
And then you get into the area where we seem to have shifted from things into experiences.
That seems to be a trend that definitely seems to have started a few years ago but seems to be here for the long term.
So we get that benefit.
So that's a nice tailwind.
But then we get other things.
For example, we have people who never, ever used to buy anything digitally.
Now they're buying things digitally, so they come to us.
And then you also have the people who say, well, I'm still not going to do it.
But those are generally an older demographic.
And just the way time works.
These people will no longer be consumers because they'll have passed on.
But the new generations coming up, they are digital natives.
So they are, of course, buying their travel through someone like us.
So we have a lot of tailwinds behind us.
It is interesting in societies there's like a handful of services that continue to scale linearly as income goes up.
I think education's one, healthcare's one, travel, I think, are kind of the big buckets of it.
I'm curious.
You touched on something earlier that might be stupid and a little finance esoteric, but the reverse stock split and your stock.
Now you haven't done any more splits or anything to bring the stock price down.
I'm curious, there's the old retail sentiment about making it more accessible.
Now you can buy smaller share fractions and stuff like that.
You can buy fractional shares, right, so that argument's gone.
It's gone, but that was once upon a time.
And there also and you may be, you may not, you know, once upon a time I'm old enough to actually know this you had to buy a round lot.
Wait, I actually don't know this.
A round lot was 100 shares.
So you had to buy 100 shares or else you bought something that was not a round lot.
It would cost you a lot more money as a retail buyer.
Spiel didn't buy it.
You wouldn't go out and buy – I mean, some people maybe.
But the idea was so around a lot, 100 shares, and some people would do splits because some people could buy around a lot which is 100 shares.
Nowadays, you can buy fractional shares.
So that argument goes out the door.
But even more so is – and look at any financial study on it you cannot increase the value of a company by displaying the share in the long run.
There may be a short-term.
There's some studies that show a short-term blip because it's seen as a signaling device nothing to do with any sort of economic.
It's just that basically you've held up a flag saying we're going to do better.
Here's how we're going to tell you by doing a split.
People continue to ask this question.
I continue to say, why would you want us to do that?
There is one reason potentially to do it.
And that is giving people employee options or equity and looking at how many, and there's a psychological thing.
Or it's just so small, it doesn't matter.
If I was going to give somebody 10000 worth of equity as an employee And he says you gave me two shares.
He doesn't feel that or she doesn't feel that well.
So that – it's a psychological play.
There's some element of that that I think the people understand and it just feels different.
But I will tell you the number of times we end up trying to get our companies, when they're going public, to have a price per share of –.
20, 30 bucks, something like that.
Because it ends up people feel good about those amounts and it trades decently well and whatever.
The investment banks have talked us into it.
But it is funny the number of times when we've had to do stock splits or reverse splits or whatever in the private markets, explaining to the employees that you're not taking anything away from them.
It's right.
You're going to have the same ownership in the business.
And it's interesting.
I think a lot of people know it, but it still feels a little psychologically worse.
But very smart people, you have to sit down and be like, no, no, here's how the math works.
And you end up doing a whiteboard exercise.
And so I always encourage my companies to try to in the early day series A's.
Keep the price per share if you can around a dollar or two dollars, three dollars.
Right.
And it just for whatever reason, that math works out and it helps on employee hiring.
It is fascinating how that psychological thing, which just shows and.
When I went to school and I studied economics and this whole idea, there was this idea there's a rational person, you know, homo rationalist.
But the truth is there was no such thing as behavioral economics in school when I was there.
Now it's become a very big school of economics.
I really believe in that.
So you're talking about a certain price for your company when you bring that.
But you're talking the US.
If you go to London, what are most of the stocks quoted in?
They're not in pounds.
It's pence.
It's pence.
So it's just the socialization of what seems normal or not.
Well, then you get the cultural elements of different people valuing stock and options differently.
And we had.
I had a French company once upon a time and you couldn't convince.
Like they didn't value the ownership in the business at all.
Absolutely seeing the upside.
Very true.
Now that's changed, i think you still see elements of it.
Yeah, there are different cultures that value and they're also different levels and it's interesting where you'll get your more senior managers who are more knowledgeable and are more interested in equity and in terms of trying to prove it, but you'll get more of the rank and file say thank you very much, but i would prefer to have you know more of my paycheck Sure.
Yeah, for sure.
They've seen or they just don't have the risk on in that perspective.
So from a Priceline standpoint.
So you acquired Booking 2005, but you ended up doing a merger with, So we bought before that.
So we bought a company.
So again...
We started the company Priceline.
It was a thing which many people may not even know, because so long ago was a thing called name your own price.
Oh, yeah.
William Shatner.
You got it.
It was an opaque way to buy something.
It was a good niche product.
It was niche.
And we relatively early realized that.
You know, if we want to be a bigger company, we're going to sell travel the way everybody buys it, which is knowing what you're buying, knowing you know where it is.
If it's an airline ticket, when's it going to take off, how many stops you're going to make, et cetera.
So we had to buy something retail.
So we went out and we bought a couple of small companies so we could have a retail presence everywhere in the US.
But we also wanted to be big outside the US.
And the only thing we had outside the US was a thing.
We had a thing called Priceline Europe, which I was running at the time.
And which is one of the craziest things, because somebody in the US may be willing to say look, if I can get a big amount of savings by buying a flight, I don't know when it's taking off.
I
Don't know when it's landing.
I don't know if we're going to make a stop somewhere, but I'll do it to save the money, because in the U S many cities you have to make a stop anyway the hub and spoke system.
But in Europe to try and do that and say listen.
I'm going to give you a great deal from London to Paris.
It's going to save you 50%.
And you have Ryanair that's going to charge you 10 pounds to go.
So you're going to save me 50% five pounds, but I may end up in Frankfurt first.
No, thank you.
I'll just take the direct.
Not a good idea.
So this is 2002, 2003.
I'm going over trying to figure out how we're going to run it.
What are we going to do? just out of school, real smart people out of Cambridge.
And they had a company called Active Hotels that sold just hotels, but it sold hotels the old fashioned way.
They told you what the hotel was, the name, where it was, and how much it was gonna cost.
You didn't have to bid for it under the name your own price method.
And we were able to have a good relationship.
And they liked us.
We liked them.
But then they decided, because they had outside investors, we'll have to do an auction anyway.
Hired UBS.
And we didn't have the highest price.
But we won the deal because we're able to convince the management team that's had a substantial amount of equity in it that, working with us, we'd let them still run the company more than some of the other bidders were willing to do it.
And that's what got them to do it.
So we did that in 2004.
First acquisition?
First acquisition in 2004, there was 165 million U.S.
It was about 100 and something employees, was just barely profitable.
And then, a couple of months later, I was talking with the CEO and he said to me you know, do you know these guys at Bookingcom?
They're over in Amsterdam.
I said, yeah, I kind of know them.
Why?
He says well, they're in London and we were going to do a deal with them, but then we did the auction, so we put them aside.
But you should meet them.
I'm saying, I don't know.
I'm supposed to go home tomorrow.
I don't know.
I'll meet them tomorrow.
And then I thought, oh, okay.
So I call my wife and I say, look, honey, I'm not coming home.
I got to meet this.
I'll be home the next day, no problem.
And I go and I meet the people at bookingcom who were there for a big travel conference called World Travel Mark.
And I thought, whoa, this is very interesting.
These guys are onto something.
Because it looked like hand in glove active hotels in the UK, bookingcom in Europe.
Same model, very much so.
I said, oh, this is great.
So I say to the guys in the meeting, I say, you know, I'm very interested in this.
I'd like to meet you some more.
When may that happen?
They said, what about tomorrow?
I said, what a good idea.
Call up my wife, say, honey, I'm not going home tomorrow either.
I'm going to meet these people in Amsterdam.
Long story short.
We finally get the deal done many, many months later, and we combined active and booking.
Booking was 135 million.
So combined together, 300 million for the both of them merged together.
They also had about 100.
So we had about 200 and something employees total.
Booking was losing a lot of money.
Very cash flow negative at the time.
And the reason was because both they and Active Hotel worked on something known as the agency method.
And the agency method was you booked the hotel, but you didn't pay Active Hotels or Booking.com.
You wait until you showed up at the hotel and you paid the hotel.
Then sometime later, the hotel would send us our commission.
Now, that's a cash flow problem because you're not getting paid until a long way down the road.
But if you put ads into Google, they want their money now.
So the faster you grow, the worse your cash flow was.
Luckily, we had some cash, and that was part of it.
But look, it all worked out well.
So at the time was that like going back to that agency model, which was the way it was once done with travel agents.
Yeah, yes and no.
There was both the agency model, which we just described.
There's also the merchant model, where your credit card was charged immediately, even though you may not be traveling for many, many months.
It didn't matter.
That's the way it was done.
We're a tour operator.
That was the way that was done.
So there were two models.
The price line, name your own price method, that was done on the merchant basis.
Essentially, your card was charged as soon as we said you won the bid.
You got it.
That was done.
So there are two ways, but there's certainly a very different cash flow.
The merchant model, you get to keep the cash, you hand it over to the supplier way down the road.
In fact, back in the day, back in that time, turn of the century, You had people who were not handing money over to the suppliers until long after the travel had occurred.
Therefore, the hoteliers, for example, liked our model much better because they got the cash sooner.
Yeah.
So how did that was that a big insight or leaning into that model?
Was that one of the things that helped?
Obviously, great execution, brand, all that stuff.
But yeah it.
It helped develop relationships with hoteliers because they wanted the cash.
But it was something that didn't really work well for a lot of companies because when you did the agency model, especially in the US
The hotels were not paying the commissions, even though they were supposed to.
They just wouldn't do it, or they'd forget to do it, or just the systems didn't work.
They said, I'm not paying you.
I don't see this reservation.
So it was a thing that a lot of people didn't really like so much.
People liked the merchant model, the distributors, because they got the money first.
It's something that helped us develop relationships with hotels and get them on board quickly.
No risk to them.
We said, sign up with us.
You don't have to pay us any money. until we put a head in your bet.
Then send us the money later.
So do you remember market cap?
Those two were 300 million roughly.
Combined.
Combined.
Combined.
How big was Priceline at the time?
Boy, well, very volatile.
Very volatile.
Do you remember roughly what percentage of the company?
Yeah, about a billion round off.
So a third of the business was?
Yeah, and there were times where it would have been less.
Got it.
Okay, so – and I assume it was kind of a mix of cash and stock.
No, it was all cash.
It was all cash?
All cash.
Oh, interesting.
All cash, but – and this is also an intricate thing.
One of the things we – and this is something I –
A lot of people were involved in this, but it was a really smart thing to come up with is providing the incentive to the founders to make sure they still had skin in the game.
Because one of the worst things to do would have been, okay, we're going to buy this company.
We don't know how to run it.
I'm in London.
I'm going back and forth to London.
I don't know how to run this thing.
We have the people who are building this thing.
They know how to do it.
They're great.
We're buying because they're good.
Why would we want them to leave?
We want them to stay.
So we have to give them an incentive.
So we came up with a way that the metrics they achieved would give them a certain amount of equity.
And that was an incentive that really, in the end, really paid off well.
And it was a win-win for everybody.
Sometimes people, they say, I hate earnouts.
I hate an earnout because I may end up paying a lot more than I wanted to.
The reverse to me is I want to pay out as high as I can, because that means that the value went up a lot.
It's weird sometimes people who say that I don't want to have to pay too high an earn out at the end of the day,
How long did the founders of the businesses hang around?
It was three years.
It was structured for three years at Active.
Then we combined Active and when we did Booking we combined it into a new plan three years, but it was right about the same.
And then the founders from Active pretty much moved on and the people at Booking stayed, being in charge of the combined thing.
And they stayed not only for the first three, but then we upped them again at the end of three years with a new incentive plan.
So they stayed six, not all, most of them, six.
And so, after that, the big deals that people are probably familiar with, in addition to the booking acquisition.
So in order, I guess it was what, Kayak happened, when was that?
Well, Agoda, you can't forget Agoda, because Agoda was 2007.
And part of the – Our American listeners maybe don't know Agoda.
Right.
So Agoda is based – its legal headquarters is in Singapore.
It has a large operation in Bangkok.
It's a big APAC.
APAC-oriented merchant model.
Totally merchant model at the time.
Now, so somebody would say, the board, you say, well, why do you want to buy this?
You already have a worldwide booking.com, which did have some operations in Asia.
We did have some.
Why would you do that?
And the reason is because I wasn't certain whether the agency model or the merchant model was better for the cultures of Asia and the different way things were done.
So I have two ways to do it and see which one does better.
Well, they both do very well, and Agoda's been fantastic, just rocking.
It is the biggest company.
A travel player, PanAsia.
Now that's ex-China because Tripcom, the old C-Trip, which is a Chinese travel player, they're much, much bigger.
But we'll do ex-China.
We'll just do non-Chinese Asia and go to number one.
That was 2007.
Now, that was almost nothing.
That was $16 million.
Or so.
One six.
And that thing's worth billions.
Wow.
Many billions.
Wow.
So then we did Kayak later, and that was 2012, I guess.
And then Open Table, 2014, I think.
But yeah, that didn't...
And so I guess I'm interested in how you think about the autonomy and the ability to allow these brands to sort of operate on their own versus the um shared domain and uh, I guess the, the commonalities that make it one company and not just a distributed bunch of whole codes that can necessarily be spun sort of the IAC model, versus the fully integrated uh company working together.
How do you sort of think of those two things?
Well, first of all, they were growing so fast, all of them, that taking a time out to do integrations would be a really bad idea.
Why would you do that?
Even more so, as I said, we have independent owner-founders who want to still feel they are the masters of their domain and still make decisions.
You want to do that, too.
On the other hand, you do want to achieve some level of synergy, some benefits of why is it better together than separate?
And that together
Over time, we have moved from what was a very separate domain, a group of independent into a more cohesive more sharing of knowledge, more sharing of information, working together, bringing these together.
But we're still nowhere near where I'd like to be.
And here's a perfect example.
When I stay in London, if I go to, let's say, Mayfair and let's say I stay in an expensive hotel there, any one of them?
Well, there are a lot of very expensive restaurants in Mayfair.
But I staying in a hotel in Mayfair that I have bookingcom knows I'm there because I'm booked there.
And Booking Holdings has open table with a lot of reservations, a lot of relationships with the restaurants.
There's nothing happening there.
There's no offer coming from a restaurateur saying, Mr. Fogle, we see you're in London.
Would we convince you to come over to our nice, fine restaurant?
And we have a wonderful, wonderful offer on Cabernet's.
That does not happen yet.
I want that to happen as part of our connected trip vision. but it's not there yet.
Do you think the public market appropriately values the different businesses and the distillation?
Because one of the arguments I guess that the IAC would have is that hey, sometimes these things being spun out is the way of achieving the fair value.
Do you think that the public market ultimately gets this right over a?
Well, there's a lot of theories about conglomerate discounts or not.
And is there a premium?
Is the cash flow from one of the non-booking dot-com companies being valued at the overall multiple that's higher than they would be on their own?
The sum of the parts.
Exactly.
So hard to say.
I do believe this, though.
I do believe there's a lot of synergy happening already and a lot more to come, as we continue to bring together the best learnings, how things are being done, in particular, things like OpenTable, others that I think there is the potential to really create a better experience.
Because, at the end of the day, The value of the company really is going to come down to what kind of value are you doing for the consumer and what value are you bringing to your suppliers?
Two-sided marketplace.
If we're achieving value for both of them, that's really the end is going to produce great value for the owners.
Are there businesses that you look to, either historic ones or analogous ones, that you feel like have done a really good job of, where you hope to skate to where it's going, where there's shared services but independent brands?
I mean not that we want to go, that we'll go to.
But I'll say, look at the value you get out of Google.
We can go talk to the Department of Justice about it.
Yeah, I was going to say.
They see it too.
We might need to release this quickly, how long we talk about it.
Right, right, right.
They see the value there too.
So there is tremendous value.
Or look at Amazon.
And how well all the different things there.
Look at the Apple ecosystem, right?
Isn't that wonderful how it all ties together so beautifully and so easy to use?
I mean, those are examples that where it's any consumer would say, wow, I really get great view.
This is fantastic.
Now, the issue, though, you end up with regulators say, gee, I'm not so sure I like this.
And there's an opposing view that that stifles competition.
In the end, we won't get as much new things.
You know the arguments as I do.
Yeah, for sure.
Yeah, it's interesting because Apple has done it in a very mostly homegrown way.
Google, with the exception of YouTube, it's – Well, they bought Android.
Yeah, Android, I guess.
They bought Waze.
That was an acquisition as well.
Okay, yeah.
I mean, there are a bunch.
Yeah, yeah.
There are a bunch of actual meaningful ones.
I wonder how much.
I guess they've done a good job of the shared services between those.
It really does work well.
It works nicely.
That's interesting.
So there's this thing, artificial intelligence, that people are talking about these days.
I would be remiss not to ask.
I'm curious in what ways does it get you excited about?
There's a bunch of stuff you guys are doing.
How do you think about the opportunity for your business for consumers?
Maybe a quick spot or advertisement for some of the stuff you guys are doing?
Yeah, well, definitely.
Look, AI is an old term from a long time ago, even when I was working as a trader at Morgan Stanley.
And we had people who were creating neural networks to try and come up with different types of training algorithms and such
So this is old stuff.
At the time, of course, we didn't have the compute power and a whole bunch of reasons why it never really took off until some of the really revolutionary things happened in the last, let's say, 10 years, maybe a little bit more about 10 years, 12 years, and then some real acceleration in the last five years or so.
And now we're into the whole world of large language models and gen AI and all the positive.
Long story short, we absolutely believe that this is transformational.
The world will be better.
Society is going to change for the better.
And we're really looking forward to it.
Now, the things that we bring to the table, things that we can do, that we believe are helpful, is things that we just started very early stage.
So booking.com, we have a thing called our AI trip planner.
And basically you're having a natural conversation in a chatbot where you are putting out what you want to do and squirking back and forth.
The ultimate goal, of course, is recreating that human travel agent who knew you so well, knew what you wanted, knew what you liked, knew what you could afford, brought a few choices to you and you worked back and forth with her and came up with what you wanted.
We want to recreate that only better, because the technology is going to do it much better than a human could have done.
That's one.
Even more important is using all the ability of us to know where the problems may be coming and solve that problem before it happens, or at least offer a great solution right away.
I mean, let's take customer service, for example, right now.
So you go into the airport and you get a text message from an airline, or even us, and it says We're sorry, but your flight's going to be delayed six hours right.
Well, that's nice to tell me that, but how about a solution?
Now what the airline's not going to do and say oh and, by the way, we have a competing competitor who's got the flight going to the same airport or the same city in three hours, but we're not going to offer that to you.
So we though, as somebody who's indifferent, we would be offering that up and change that even more so.
Though, now that's changed same city, different airport And we're saying and we have changed your rental car because you're landing at a different airport.
And, oh, by the way, you're going to be late for your dinner.
So don't worry, though.
We've looked at OpenTable.
Unfortunately, there isn't a reservation three hours later for you at that bus stop.
We have a very similar restaurant right down the street.
Would you like us to rebook there and notify your other people in your party about that change?
Blah, blah, blah, blah.
That's where it's going to be.
That's dealing with the traveler.
Now, in terms of just i'm curious to just interrupt you i mean that sounds fantastic and the amount of time that i spend when a flight gets delayed.
And i'm looking between it's crazy, from jfk la guardia newark, what's the time, where am i right now?
Can i land in, you know, whatever?
Can i land in san francisco or san jose or oakland, or it's crazy how much you do and the reservations and all the people you need to notify.
That world use percentage sounds very nice to me.
How far away do you think we are from actually being able to do that in an automated sort of large language model type way?
Right.
Not going to happen tomorrow.
Yeah.
I'm flying tomorrow.
But it will happen incrementally.
Over time, it will.
We're already seeing some benefits happening now.
In addition, part of the thing right off the bat number one thing is the thing that really ticks you off is you got a problem?
You call customer service and it's hold.
And by the way, if it's a big problem, the hold is longer term.
You got a big storm came in.
We're going to be on hold for an hour, two hours.
God knows when they're going to come back to you, right?
Think about customer service, though, as being done automated through Gen AI.
Well, you have infinite expansion.
It's an elastic, but you can handle them all at once.
That's the benefit, not having to wait.
Now, another one is, The customer service AI that is a gen AI agent will never yell back at you.
You can be as angry as you want.
It will still treat you nicely and pleasantly.
It will not get upset because you're upset.
And in addition, it will have all the rules.
It will know all the things.
How many times you finally so you're on the hold for an hour finally got the customer service person and you tell them the situation and they say okay, could you hold one moment while I check with someone else?
Or they ask you to reenter your, your travel code or whatever.
It just kills you, doesn't it?
Yeah.
And those things should all be solved relatively soon.
That's actually an interesting point, because a lot of people talk about like how can it get to human parody?
But, uh, Which, you know, in certain functional areas we're definitely at already or past.
But the superhuman element of the ability to consume all of the possible information instantaneously and remove the latency between the communication and all that stuff.
That's so important there's.
There's just a.
It's impossible for a human to know all that stuff in real time.
And so it'll take us well past, you know, the point that we're even the best people.
And we're working on that right now, as are many other people, but you'll see it.
Uh, we are seeing great improvement.
Priceline, the customer service.
They're using some of these.
We're seeing some great pickup there.
Um, there are many areas and lots of people are doing it.
One of the benefits for us is the data.
We have more travel data.
So we know things more than other people would know and being able to bring it all together.
That's a big advantage because it's not just you can say well well, why is this going to be better than say, pick any of your large language model players right?
Why is this going better?
Well, the difference is by working together, using their what they know and what we know, creates a better solution in the end.
And we're working with all of them.
So I interrupted you.
That's on the traveler side.
Right.
On the other side, let's go into productivity for ourselves.
So we all know how much coding can be more efficient.
That's table stakes.
Everybody is doing that.
That's an important thing.
Then you go over to your suppliers though, and coming up with what a supplier want is incremental demand.
See, what they don't want is to have to pay for distribution for something that they would have gotten anyway.
But coming up with the right way to be able to present the right offer that they are willing to give if it's placed in the right way.
The last thing someone at one of the big hotel brands wants to do is offer a discount to somebody who's already a loyalty customer of theirs.
But they'd be very happy to try and get somebody who's loyal to one of their competitors or is anywhere
So example, we are so global.
So it's hard for the big US-based international chain to get customers from many parts of the world because they don't have a presence or a marketing budget there.
You want to get a customer from Pakistan, i'll get it for you, but you'll have to pay for that and they're more than happy to do it.
And we can come up with different ways using all the different science of the data.
What is the right price to offer and when is it to offer it?
So if you go with an attraction in a city, nobody goes to a city to hang out in their hotel room.
They want to do things.
Well, What the supplier?
Let's say in Amsterdam, the person who does the boat canals, that doesn't know what should I price for the different customers coming from different countries?
Or what should I do for different times of the day?
We, using all our data, can provide that type of a service and provide benefit to them.
Again, so many areas, so many things are going to be so different.
How do you think about the opportunity, as we're potentially moving at least some of search to I don't know the right term answer engines or things like perplexity and chat, GPT and some of these Gemini where it's ultimately surfacing up some answers and maybe less of the 10 blue links and the SPA, whatever the sidebar thing is called?
How do you think about that for your business and the world we're moving into?
Well, again, we're all going to see how is this going to play out?
How are people going to monetize this or not?
And so, oh, you guys are going to be toast.
So here's the interesting thing.
I've been hearing that our company was going to be toast now, for I've been here almost 25 years and I've heard it all the time how we're going to be toast.
Now, someday companies will disappear.
I mean, we look at just talking with someone about the Dow Jones, None of the original companies that starred in that index are still there.
The last one was General Electric and 2017 was dropped out.
And you look at the SP 500.
What's the average length a company stays in the SP 500 before it disappears?
So there is a terminal thing.
All species do go extinct at some point.
My thing, though, for us right now, we have so many opportunities in the future.
And it really is what's our advantage, our competitive advantage.
And that is the loyalty of the customers feeling trust with what we do.
It's the data that we have and the ability to execute.
Look.
Someone wants just to give away a product or service, you can get a lot of volume doing that.
And for some of the companies because of their amount of resources.
If they wanted to, they could give away for a very long time.
Of course there are issues in regulatory issues that would cause some problems for them, etc.
If things are done on an even playing field, I am very confident we'll be able for a very long time, using the new technologies, provide a better service in cooperation with all the other people in the travel industry.
So I don't know if I wrote this or if this was a quote from someone else.
I haven't in quotes.
So it says here, you've been called one of the greatest acquirers in history.
I don't know if I said that or someone else said it.
Someone else said it.
Yeah.
Listen, it's quite a compliment.
So I'm curious your approach to – Well, let's just cut that one right.
Yeah.
Okay.
Yeah.
No deal is done by one person.
I don't know – It's a combination of a lot of teamwork by a lot of people with a lot of good ideas.
It's this idea that – this idea that like Steve Jobs, you know – What?
He created the iPhone and the iPod by himself, but he's like soldering it.
Come on.
There's so many people involved in this idea of creating business people on this pedestal, as though they had the sole lone leader who look.
It's nice and leadership is important to anything to be successful, but you got to speak the truth, which is nothing gets done that's not done by a team.
Well, so you have a team of amazing people that have done fantastic acquisitions, of which you've shepherded quite a few.
I'm curious your approach to M&A.
We talked about earlier some of the incentives and how you thought about it.
Are you constantly evaluating opportunities?
Is this a rhythm that you like being in on a daily, weekly basis?
Is it opportunistic?
Not as much.
Being a CEO of Bookingcom and Booking Holdings.
I don't have the time, but I have a very good person who does it, Todd Henrichs, who's been with me for a very long time.
He was a banker.
I was able to hire him.
He had been a banker at Bear Stearns.
And Lehman Brothers.
And so I thought, hmm, got to wonder if there's anything there I got to worry about.
He was at UBS, actually.
Exactly.
But Todd's been here great.
And he's now in charge of corporate development.
And I got a great CFO, Avon Steenbergen.
He's a person who knows a lot about M&A.
But here's the thing.
Right now... you are probably aware, we were trying to buy a company called eTravel.
Are you familiar?
And relatively small deal.
And the EU Commission has blocked us from doing that.
And their reasoning was it will help us in our hotel business.
Now, eTravel sells airplane tickets.
I mean, yet they say that will help you.
And therefore, they say, because you are a dominant player in Europe.
You should not be allowed to buy this.
Now, we're in the courts and we're going to go and I'm not sure exactly when the hearings are.
But we're going to fight this all the way in because I absolutely believe they're wrong on the facts.
They're wrong on the law.
And it's absolutely bad for the consumer and it's bad for the supply.
There's nothing good about this actually.
But –
It's got to work within the constraints of the law, and this is a legal case that we have to go through.
So right now, it's more difficult for us to do M&A because of that case.
We'll see how it plays out.
Well, I want to ask about regulation here in a second.
But I guess, as you think about the characteristics that have made successful deals for you, are there certain things that stand out as hey, anytime we've done a really successful deal, it's had these characteristics, and anytime a deal's failed, it's had these.
Or is that too simplistic? simplistic?
Like someone that's listening and may be thinking about an acquisition for the first time, or maybe they made a bad one.
Like what are some of the things that you've learned that you would impart?
I had a couple of random thoughts on this.
So the first thing is so, as a banker for long enough to do enough MA deals to know that most deals fail without having to read all the academic studies on it which say that most deals fail.
There's a lot of books, right?
You've read, uh, all of them.
Yeah.
All the books about success.
My favorite is there's actually a book titled deals from hell.
Yes.
Actual title of a book.
Is it a good read?
It's a fun read.
Yeah.
Okay.
Yeah.
And there's so many, um, There's so many.
The Synergy Myth was another book.
There's so many.
And here's the thing.
So we know factually that most deals are bad for the acquirer.
And now you start thinking, well, why?
Is there a pattern?
Because human beings love pattern recognition.
So your question started, is there a pattern on the good side or not?
And is the sample large enough to be able to actually read something about.
But of course, the world's always changed.
So even if you did identify the pattern was good then, is it still good now or not?
At the end of the day, the thing that's really important is Do you believe in the people?
Are those people capable of taking the company beyond where it is right now in a way that will do something that you believe is worth the premium you're going to have to pay to acquire it?
The other one is that if it's not a people-driven thing, if it's just an asset, you're a coal miner and you're buying another mine.
How much coal is there in the mine, do you really believe or not, that's still left to be mined?
Those are two ways to do it.
Our business, our business obviously is a travel.
Travel is a service-oriented.
It's really the people at the end of the day.
And it's worked out well enough, but we've gotten it wrong.
We bought a company.
I won't go into too much detail.
So we bought a company, and the person actually –
They said they wanted to stay on.
They want to help build this thing.
They want to be really good.
And I don't think the ink was even dry before.
I don't think I want to stay, actually.
Thank you very much for playing.
Even though there was a big incentive to stay, but you give someone enough, they have other choices.
And so you're going to get fooled by some people some of the time.
Again, it's a game of probabilities.
You hope that you're right more times than you're wrong, or at least the times you're right give you enough value that it overpowers the times you're wrong.
So you actually I mean similar to, I guess, my business but the power law of the ones that work you, just those need to outstrip materially any of the other ones that fail.
It's a little different, though, for us because we are not a VC.
We're not a PE firm.
We really have to do a deal, not think well, we're going to do 10 deals and one of them will pay for the other, you know, pay for.
One will pay for like seven, and the other two will break even.
That's not our game.
Our game is hopefully every single one is going to be a great success, of course, but even more so I will take great questioning.
Do I do a deal that fails?
It's not like, well, we understand things.
From the public markets and internal?
From the public markets and internal, from the board, et cetera, et cetera.
But looks part of the problem, I think for us was we didn't take enough risk early.
When you look at, we did not have a deal that went south until far into the time that i was running corporate development.
Perhaps it's just too conservative.
The deals that fail we obviously i mean being uh misled.
Maybe was the example of that founder, or at least uh not not foreseeing their change of heart that came after.
Yeah, we'll be altruistic about their, their motives on it.
Um, i had heard you mention that there's also some uh Like.
If deals are being done for ego, if there's no culture like alignment, what were some of the other things that maybe lead to some level of organ rejection or just – Well, cultural is always important.
And especially when you're doing things that are international that are –.
Companies have different viewpoints on how things are.
What's important to other ones?
Trying to get people aligned.
That's a big issue.
A lot of deals fail because of a mismatch in culture.
And it's just really hard to turn that other company into the culture you want.
Culture, you know, everyone acknowledges this is important, but it does feel at times ethereal and um, it's sort of hard to put your finger on it, i guess when you're assessing these no, i don't find it that hard, so i'm curious.
So when you're, when you're assessing two different cultures, and will they be um, simpatico in some ways within uh, within booking um?
I'll give you an example.
One of the things I loved about Active Hotel.
So we were I'll use a polite word, we were very frugal at Priceline.
Extremely frugal because we had almost no cash at one point.
So you learned to be very, very, you know, near-death experiences will change your mind.
When I first went and visited Active Hotels I said I'm not sure, but I think they may be breaking the fire code because there are too many people in this floor.
And everybody's cringing like a rabbit.
But I liked it, not because I thought maybe they were breaking the fire code, but because they were cheap.
They were incredibly cheap.
That's a culture.
I like that.
You go to another company and, you know, they have beautiful offices.
Well, that can cause you a problem.
But here's the interesting thing.
So when I went and visited Agoda for the first time man, they were one of the most expensive offices offices in Bangkok.
And I'm thinking, huh, this is interesting.
Until I spoke with the founders about it.
And they were telling me, look, here's why we do this.
Because it makes us seem real.
Yeah, we're able to get great talent because we look like a real company of big, successful company that were in this big tower in bangkok.
So for them it actually made sense and i was okay with that.
Different cultures, different things, different happening.
That's an important thing, though it's just examples of things you really have to think about When you're involved in a bunch of different geos like that.
How do you think about what the shared cultural framework of booking across the board is?
And when you do all hands or things like that across all these different properties that are very different groups, cultures and incentives and all that.
Are there a handful of shared values or do you sort of let people operate independently?
There are both.
There are both.
There are individual things there.
Some of the shared things are ethics right off the bat.
And this is really important when you're operating globally.
Because, and let's just, again, speak honestly and openly about the way the world works.
Some parts of the world treat certain things as okay to do.
Where, in other parts of the world, those things are not okay to do?
And the US has some very strict rules and laws about these things, about bribery.
In fact something very recent.
We just saw, probably yesterday, a very wealthy person's been charged with an extreme bribery case.
These things are no go.
I don't care that, you know, in your country, this is how we do business.
No, we don't do business that way.
It's something I learned when I had my first job at Morgan Stanley.
And it was one of the very early days they were talking about the company.
And they said, I don't know who said it first.
It's probably from long ago.
But they said, we would rather lose money than reputation.
That's really important, and that's something to force through.
Other things will be individual because like, if you're, let's say, an American football team, and again I always have a concern.
If I say football, I've got to put American in front of it, so we know what we're talking about.
But you know, the defense is going to have their culture and the way the offense is going to have it and the special teams are going to have another thing.
That's okay, but they all believe in winning the game.
It's more important to win the game than for the offense to just score lots of points.
That is how you win the game.
But what the mindset has to be at the group has to be we are one company.
And that's something that's taking time.
We're still working to make sure everybody understands.
Yeah, you may be wearing the jersey of this particular brand.
But your higher need is to be successful for the whole company.
We have one set of owners.
All they care about, the owners care about, is the success of booking holdings, not any of the individual brands.
Right.
When you acquire these different businesses, they've almost all stood on their own, with the acquired brand persisting.
Is that fairly – To start, yeah.
To start.
To start.
Have you brought some back into –
We did that one.
It's now part of Booking.
It is part of Booking.com.
Though the brand still lives and we still have people who will go, but we're moving, trying to get them over to the Bookingcom one.
How do you think about that element of brand and the existing credibility that maybe comes from whatever they built in a local market versus?
The credibility that Booking or Priceline or Kayak or OpenTable or whatever it is have on their own and rebranding some of these properties.
You have to think – and again we're not – what we're doing is – it's been a very long slow movement.
And you don't – what you don't want to do is destroy value.
People who know – the rentalcarscom brand and loved it and go to it.
You don't want to then lose those customers.
You have to very gradually, very slowly moving it over.
And that's something that's interesting, because the cost of maintaining it can be relatively low and you get some nice return out of that.
We have not thought of, you know, some people say, why don't you just make everything booking.com?
Because there's a lot of value in Priceline.com and Agoda.
That's why we don't.
Interesting.
I guess you had tried – I don't know.
Do you guys still have a B2B business?
We have a huge B2B business.
B2B.
Okay, got it.
And managing the cultural differences and sort of having those two –
I guess, go-to-markets and a lot of the different things that ultimately come from running a B2B and a very consumer-oriented business.
Do those get run entirely independently?
Are there leaders of the B2B business that are separate?
Within each of the brands, there is a B2B industry.
Component to it.
Component to it, sure.
Bringing on supply side or whatever.
Well, but more like, for example, so if you were to go to –
A bank, let's say, and the bank offers travel services.
Well, somebody is doing that.
Could be us.
Could be one of our competitors.
We have a unit.
Their job is called strategic partnerships.
Their job is out there pitching our services to third parties for us to power the travel for them.
That's the B2B section.
I think you're talking.
And once upon a time you made maybe an acquisition in sort of the software backend space for hotels.
Is that right?
Well, a long time ago, we made one in a Barcelona company, a very, very small one.
Yeah.
And this was the founder that's now Travel Perk, right?
Exactly.
Yes.
Got it.
And so I'm curious, the learning of that in trying to manage a software company, I guess, not B2B.
Right.
Well, first, I have to compliment you on your research.
Thank you.
That is very impressive.
Yeah, the deep guts of all this.
Not a lot of people would have seen that one.
Yeah, yeah, yeah.
Just wait until the stuff below the water line.
Yeah, yeah.
Avi's a great guy, and we parted on very good terms.
And part of it was that was within bookingcom and he couldn't get the attention and the resources and we were just going so fast on our regular business.
And it's unfortunate because he's a great guy and I do believe he's offering a great service.
And it would have been lovely if that had been part of the business, we'd be able to grow that.
But you can only do so many things in a day.
Do you think that could have worked as an independent business?
Like had it stayed an independent brand within?
Yeah, I think, I think it would have been a better thing to have done.
It's amazing how much hindsight.
Yeah, exactly.
Yeah.
Perfect, perfect fidelity on all this stuff.
You started to allude to some of the regulatory environment earlier.
I'm curious if you had a magic wand or your druthers about how all this stuff could play out.
Do you see solutions that are within grasp, that people just aren't paying attention to in the complexity of some of these elements of antitrust law?
Not even talking about your specific issue, but more generally, this is a hot topic.
Yeah, it really is.
Yeah.
I think most people, most people have good intentions and they're trying to create what is best for society, for the faith.
You're a government regulator.
I hope that most people there are trying to come up with a way that they believe that this will improve our overall society.
And if you – we work in a market economy and some people believe that this would be better if we could shape it using these kinds of rules and regulations.
The problem is though, a lot of times people are just not aware enough of how the market really works.
And when you go in conversations with regulators and I'm speaking specifically for me and others, but I imagine it's pretty much across the board is you learn that the people who are making the rules really don't know your business or industry nearly as well as they need to try and make these decisions?
It's kind of like unfortunate.
Yeah.
And I know of examples where governments have wanted to start an action.
The company that would be the object of this action have gone and explained to the regulator how this business went.
And then they're like, oh, oh, never mind.
It's like, really?
How did you not know this before you were ready to start a regulation?
Yeah.
Ego into many things are – and I got such abuse because there was a headline in the FT.
I was speaking at a conference.
I was talking about smart regulations and dumb regulations.
I'll put that in quotes.
And, of course, the headline was Fogel objects to dumb regulations.
Really?
But there are.
I'll give you some examples.
So –
For a very long time, the rule has been that commercial pilots should not be flying after 65.
Now, what's the reason?
Well, the reason is they believe that we want to have safety.
So who's against safety?
But is that the right regulation to help improve safety, especially if the regulation came out many decades ago?
A 65-year-old is very different now than a 65 from 40 or 50 years ago.
Two don't we really want to test is that person healthy enough and capable enough to be able to fly a plane or not?
And that should be the test.
So we should be coming up with regulations that are smart, regulations that actually achieve the goal in a more efficient way than a blunt instrument that says after 65 you got to retire.
Which is not so, especially when there was a shortage of pilots.
And that's just one small example.
We can come up with a whole bunch of other ones.
I mean, it totally makes sense.
And I, too, do not object to safety.
Who's against it?
Yeah, exactly.
Who's against it?
Yeah, motherhood and apple pie and safety.
But I'm curious, I guess...
I haven't thought this through, but as you, as you think about like these smart regulations, do you end up?
When we think about something like that?
Inevitably, we then end up with some tests that someone needs to pass.
And of course, why not?
And then so is that the better solution?
I'm not a pilot.
Sure, but we do know that pilots are being trained all the time in the simulator, right?
So how hard would it be to set up a test in the simulator?
Okay, let's see how you handle these issues or not.
Do you handle it quick enough, fast enough or not?
And then that should be able to say okay, you passed, you're good, versus the way 65 just makes zero sense to me.
Yeah, you know, whenever I hear, I mean, it makes so much sense, like let's have some test.
But then I remember a story from I think it was 96 97 98 the government came out with like a interoperable bill that like hey, all the systems need to be able to talk to each other.
And so it ended up getting codified all the way down into law, as they actually went into a specific framework that predated APIs of like how these things, I don't know cobalt systems, how they need to be able to talk to one another.
And and obviously the technology went way past that.
And so we still have systems that need to keep up because of this regulation.
That happened 30 years ago.
And it wasn't even the intention.
The intention was just interoperability.
But the way it got codified was.
And so I guess, when we're talking about this example, I worry about the test, because we're going to end up with some arcane to.
I guess it's better than the age.
And again, you want to have to be able to move and change center.
But you're absolutely right on that.
And what we see so many times is people fighting the last war.
So we think about and we talk about this in the digital world and such, and we think about okay remember, IBM.
That antitrust case went on for, I don't know, a decade, maybe more than a decade, right?
Because they felt that IBM was too powerful, too dominant.
But of course, the market forces made IBM a long, much more so than ended up with the regulators trying to destroy IBM.
Look at Microsoft.
Look what they did.
Oh, Microsoft's too powerful, right?
Well, you know, in the end, they're back up now, but other forces came in and market force changed.
We had Google and all Apple.
So again, I worry sometimes that we have regulators who are always fighting the last war and coming up with ways to deal with problems that were in the past that the market's going to correct in the future.
And do we really need all the energy and effort and inefficiencies that come from this or not?
It's interesting.
I guess as we think about, I mean, you're living this business every day.
And I'm curious from a business travel standpoint and what you're seeing from a trends that we're now, I guess.
What is it?
We're four and a half years post the original outbreak of COVID.
Almost five.
Almost five.
I guess some people would say it is five.
We're in November.
Yeah, November.
Some people would say, actually, we're on five.
Depending on when.
Depending on where and when.
When to patient zero.
Yeah, when the lab leak happened.
Right, exactly.
So, as you think about what has persisted, both within booking as a business, but then also as you look out on the broader travel landscape, are there any trends or things you've seen on the business and consumer side that you think we're in a steady state of what it's going to look like going forward?
It certainly changed a bit.
One of the interesting things is the blending of business and consumer, because the issue of not everybody working from home, a workplace, five days a week, two days off, and then you get a holiday and then you go travel for your holiday where now we have a not insignificant number of people who will work on Friday from someplace else.
And so you'll have the three-day or four-day weekends where people are going somewhere else.
They will get some work done and perhaps hopefully what they're supposed to get done, hopefully.
That's a change, certainly, from pre-pandemic, which is a difference and helps travel.
Going forward, I think we'll see even more of this.
Sure, lots of people say everybody should be back in the office five days a week.
And for some industries, that'll work out okay.
And certainly for people who are in certain jobs where you have to be there.
I mean, let's face it, you know it's.
You can't do meat packing from your home.
You're not allowed to do that.
The robots aren't there yet.
Exactly.
But for many people, they are going to take advantage of this, and they do travel.
And so that's a good trend for the travel industry.
On the flip side, though some people will talk about a trend which is food, started before the pandemic and now is coming back very strong is over-tourism.
And what are we going to do about that?
And you look at some cities Barcelona's example Venice, Amsterdam there are a whole bunch of places you can come up with where the people who live there feel that they are being overrun with too much travel and want to stop it and do something about that.
And certainly the home sector is certainly under the spotlight because people believe, rightly or wrongly, that has helped contribute to this problem.
So you end up with certain types of regulations for short-term rentals that are happening there.
Again, this comes down to an issue of a societal issue that, in democracy, will be decided through the ballot box, by choosing leaders who will make decisions based on what the people want.
In authoritarian places, they'll just make a decision for you.
From our own point of view, I understand both sides of it.
On the one hand, you have people who feel a need to be part of it.
So you rent out your home because it's more affordable then or you need the money.
And people who work in the tourist industry with attractions are going to have more customers.
On the other hand, if you live in that neighborhood and you are not part of it, you're like I'm being overrun by people running over with their rolling luggage.
I hate it.
So I get it.
There is a conflict.
And what we need is smart regulation.
Smart again, working together to come up with something that really takes into account all the stakeholders.
Yeah.
I mean, one of the, I guess, beauties that we have within the states is we sort of have 50 different experiments being run on, a lot of- A lot more than 50.
At a city level, too.
Because it goes down, it goes to city level.
Sure.
I mean, look at Airbnbs here, right?
Right.
Exactly.
As an example.
Totally.
And then go global.
Yeah.
Because this is a global issue.
Totally.
So it's a real-
Big issue.
Now, the mobility isn't the same between different countries.
It's even difficult between different cities.
No, but again, when you're setting up your systems.
Yes.
It makes a big deal when you have to come up with different regulatory requirements in different cities and you're forking the code all over the place to come up with and make sure you're flexible and to handle all the different permutations.
It's actually a very inefficient thing, even within the EU.
One of the issues that we're dealing with right now in the EU is the EU trying to come off with it across the EU rules on short-term rentals.
But then you have the individual member states want to have their own rules some of them and then you go into the local areas.
It's actually an issue that we're dealing with.
I'm curious on the business travel side, have you seen, are we back to pre-pandemic levels?
Which country?
Yeah, I guess that's a great question.
In the US, are we?
Yeah, it's getting.
And definitely.
I think it's probably, I think we're probably.
I haven't looked at the data recently.
It wouldn't surprise me if it's not right now passed.
On the other hand, though, what are you going to measure by?
If you're measuring by dollar amount of volume well, we've had a bit of inflation and rates are higher.
So that kind of, you just do a number of people.
And again, goes back to what we already spoke about.
How do we contribute the amount of the travel?
That was business versus the consumer leisure part, because it was combined.
That's interesting.
Are there specific countries that have really lagged or really accelerated?
Well, China is really lagged in the outbound.
I mean they are nowhere near outbound where they were in 2019, but it's coming back.
You know a nice clip, but it is still well under what the 2019 numbers were.
I'm curious from an operating standpoint.
We talked about the blending of work and travel and whether or not people are getting work done on Fridays.
Where have you guys landed on in-person, remote?
Yeah.
So in all of our brands, which have different rules and we let them set up, all of them have now a blended type thing.
But here's something that's very interesting.
So in Europe...
In the Netherlands, for example, because of the privacy rules and working with our works council and such, we can't mandate come back five days a week, nor can we measure privacy.
How many people are coming on different days individually?
I cannot.
We have put out for our bookingcom company.
We strongly suggest that you show up for 40 of the time.
Okay, so two days a week or during the month, you can break up however you want.
Here's the interesting thing about that, though.
I can't measure Who's showing up.
Not at all.
So if somebody hasn't shown up for four or five months, I cannot then go and talk to that person and say hey, why aren't you showing up?
Because privacy rules said it, we can't do that.
So you can't measure it at an individual level, but can their manager observe that they're not in for six months at a time?
Well, the manager would probably know from that, but –
We can't do anything about it.
But they can't say – I mean, I guess there's practical ways that we're going to have a meeting at the lunch place around the corner.
But my point about it is that –
Different cultures, different ways.
You have to understand that if you're going to do business in that part of the world, you have to understand what the culture is.
You have to deal with all the complexities.
You have to deal with how are things done there.
Yeah.
Don't try and force your US-centric mind on a non-US.
I heard you say that one of the big failings I don't know if you did or you observed was bringing Americans over to run a European – Yeah, both.
I've observed it and I'm aware of it.
Yeah, I'm familiar with it.
Yeah, just because you need leadership within the local markets.
You know, it's an app.
So, of course, obviously there are lots of great examples of people, of cross-cultural and extremely successful
Sure.
In fact, you interviewed the current leader of Snowflake.
Yes.
And the former leader, Frank Slootman.
Yes.
Dutchman, very successful in the U.S.
So let's not, you know, again, there are people who are able to cross call and do great jobs.
He's the most American Dutchman.
Are you ever mad?
Yeah.
As a general rule, though, I would say that it's harder for somebody who doesn't know the territory.
Yes, yes, I can imagine.
So one of the things in dealing with these crises is I guess you've, for better or for worse, you've been through a bunch.
So we talked about earlier.
I'm curious, I mean, the adage you said is that travel ultimately...
Which I think is probably a good horizon to look out on and know this too shall pass.
But for people that are maybe in different markets, different business types and all that, and they're maybe in some existential crisis, whatever it is, are there things that you would impart on how to be a leader through those periods of time?
Yeah.
Well, yes, but there are obvious ones.
I think we all – I'm not going to give any great knowledge that people don't know which is, in case of crisis, staying calm is a good idea.
And that's one.
Two –
Be optimistic because if you're going to be, all is lost, it's really going to be hard for people you're leading to feel good about the future.
So, even if you don't feel it, you don't feel it, you got to at least not be the person like you know, run away, run away.
That's not a good look.
It's not going to help you get to where you got to do.
And also, realize that most of the time, it's not as bad as you think it is.
And things, you know, this too shall pass is, you know, generally is true.
Sometimes it doesn't.
Sometimes it doesn't work out.
Sometimes ships do sink.
Companies do die.
But many times, work hard at it, think calmly, you can get yourself out of the crisis and move on.
And maybe there's damage, maybe there's scars, but you get to fight another day.
We've had so many of these.
That's why when COVID came in, many people were really, really afraid.
And I'm like, okay, here's the deal, guys.
We've been through SARS already.
I've been in this company long enough to have been through SARS-1, when there was no travel at all going to Canada from Asia because of SARS-1.
You know, there were a lot of people who you know they were like five years old when SARS-1.
They didn't know what I was talking about, but I'd seen SARS-1.
So I didn't.
I'd hoped that SARS-2 was not going to be, you know worse, but it ended up being much, much worse, of course, globally bad.
But having been through these type of cycles, having been through the global financial crisis, having been someone who was an adult during the crash of 87, you know you've been through a bunch of these things.
It's not that bad.
And again, COVID was a horrible, horrible, horrible thing.
Death came.
Terrible, terrible damage to a lot of people, a lot of communities, a lot of economics.
But I was talking to my daughter once and she was at school and she was a first year and had to go home.
COVID started.
First year of college.
First year of college.
She had to come home, you know, the spring when all the colleges were shutting down.
And she was feeling really, you know, wow, this is so horrible, it's horrible.
And I said, yeah, it is.
It is.
But there's some plaques you can go look at if you'd like.
And then the names of the people who were in college in 42 and 43 and 44 and 45, and they never got to finish.
You'll get to finish.
So it's not as bad as you make it out to be.
Freshman year.
I will say to sympathize with your daughter catching at the march of your freshman year and then having to go through the next two years of your sophomore and junior.
I mean, that's one of the – in the relative scheme, it doesn't compare to World War II.
I agree.
I sympathize.
Yes.
But again, it's just maintaining perspective.
Totally.
Perspective on the grand scheme.
Perspective on things.
I guess one more before we wrap.
You referenced in some of the stuff I was doing in preparing for this.
You referenced that you had been fired.
Yeah.
Yep.
I never actually heard the specifics of when this was.
I was working.
I was at Kidder Peabody.
He was a banker.
Yeah, yeah.
A name long since forgotten.
Long since forgotten, right.
And Kidder was owned at the time by General Electric.
And Jack Welch had acquired Cantor.
And whether it's true or not that his stammer got worse afterwards.
I have no truth, but it wouldn't surprise me.
We had a couple of scandals.
And eventually they said, we're getting rid of this.
And it sold us to Payne Webber.
And Payne Webber only really wanted the retail brokers.
Didn't really think they needed too many bankers.
And so many of the bankers were let go.
Now, I was one of the ones let go.
Now if they had let all the bankers go?
Well, they didn't want any banking, but they didn't let all of them go.
They let most of them go.
So there was a hierarchy of who got let go and who didn't let go.
And it was the standard Wall Street firing where it's, you know, that day.
Thank you very much for playing.
Please leave.
There's a guy over there.
He'll watch you as you fill your box with your personal items, and anything you can't fill your box with will be sent to your home.
And that's a really, really shitty feeling.
So one of the things is we've had to let people go.
We've done rifts.
During the pandemic, we let go 25% of the people.
Which for scale, I mean, about how many people was that?
Well, we were 25,000 people at the time.
A lot of people.
A lot of people.
So one of the things though, is knowing how that can affect people and such.
It was very important from my point of view that we did this in the best way possible is fair settlement a fair um thing that they can.
People can go on and be able to re-establish their lives, and one of the great things is we didn't let people go from bookingcom till far into 2020.
It really was 2021 where it really started.
So economies had come back, so people could get, there were other jobs to be gotten, et cetera.
A lot of other industries were booming, actually, at that point.
Exactly.
Exactly.
So that's one of the things that I'm pleased with in terms of we treated people well.
But it's a terrible thing to feel that, I'm sorry, but your job is no longer here.
It's not you.
It's your job.
And you can tell somebody that.
But people, you know, rightfully so, are not going to feel, oh, it's okay.
They're going to feel sad and angry and all sorts of things.
It's hard on people.
It was a...
It was a bad year for me.
My father had just died at a young age and my mother and my brother and my grandmother just had a stroke and the dog died that year.
It was really a bad time.
But, again, when people have bad times, I say, I get it.
I get it.
But, you know, sun will come out.
Things can change.
Things can get better.
Well, maybe we can wrap on a slightly more optimistic note than firing.
That is optimistic.
Things can get better.
Firing is a little bit of a morbid way to— But here's the thing.
If I had not been fired, I would not be where I am today.
It's an interesting – it's a very good perspective to maintain in all this stuff.
I guess as we look out in Booking's journey from here and as you sort of look forward, are there –
Is there something that you would want people to take away about the potential and the opportunity that you have in front of you, or any lasting points?
Well, the thing is I think we all see this and that is that the acceleration of technological change in our world is continuing to increase.
It's accelerating.
It's to me it's just amazing how much things have changed in the last 20 years society overall.
But then we bring it just to travel.
And from where we were.
In 2000, When I go abroad, I had to carry a piece of paper that had this red carbon on it.
Do you remember that?
It was ridiculous.
And so many things.
And now we're at a stage where it just begins.
Able to have a conversational AI driven trip planner, that you could actually have a machine come up with a better solution for your travel needs than the human being could done, and do it faster and easier.
Essentially taking away the drudgery, the pain, the uncertainty, the fear, and make the point of travel easier, even better, and that is enjoying the experience.
We're going to be there.
Absolutely.
I'm not sure how long it's going to take to get there, but we are on our way.
And I'm telling you, it's just going to be wonderful.
I'm excited for it.
I am too.
Thank you for doing this.
Well, thanks for having me.
Thank you for joining this episode of The Logan Bartlett Show with CEO of Booking Holdings, Glenn Fogle.
If you enjoyed this discussion.
We'd really appreciate it if you subscribed on whatever podcast platform you're listening to us on, as well as recommend to anyone that you think might find this interesting.
We look forward to seeing you back here next week on another great episode of The Logan Bartlett Show.
Have a great weekend, everyone.
