With a valuation of more than $2 billion, GetYourGuide is now one of the most valuable travel marketplaces in the world.
Many people attribute GetYourGuide’s success to their ability to raise large amounts of funding.
But the reality is very different.
In this article we take a look at the real story behind GetYourGuide. We see how a team of students started with a product that failed. What lessons they learnt from this experience and how this team eventually found product market fit, consistently generated great marketplace metrics and then eventually raised funding and scaled.
There are many lessons you can learn from the story behind GetYourGuide. These lessons will help to you build a website like GetYourGuide.
Before we get into the story, let’s kick off by looking at exactly what type of website GetYourGuide is.
What type of website is GetYourGuide?
GetYourGuide is a business-to-consumer, or B2C marketplace that operates in the travel niche. The platform falls into a subcategory of B2C marketplace’s called Online Travel Agencies or OTAs. This list includes competitors such as Viator, Klook, TUI, Airbnb and many more.
The way GetYourGuide works is that local tour operators and guides are able to create unique tours and then list these tours on GetYourGuide. Travellers can then visit GetYourGuide’s website where they can browse and book different tours that are listed on GetYourGuide.
Below is a screenshot of GetYourGuide’s marketplace website.
Learn more about different travel marketplaces and how these differentiate themselves from each other.
The real story behind GetYourGuide
GetYourGuide was founded by classmates Johannes Reck, Tao Tao, Tobias Rein, Martin Sieber and Pascal Mathis in 2008.
The story goes like this.
Johannes and Tao were planning to travel to Beijing for a student conference with ETH MUN. When booking their flights, Johannes (who had never been to Beijing before) accidentally booked his flight one day earlier than Tao (who knew Beijing well).
While alone in a new city, Johannes had an outdated paperback guidebook. Using this guidebook, he struggled to figure out the best way to explore the city. It wasn’t until Tao arrived the next day to serve as a local tour guide that Johannes was able to fully experience the new destination.
Johannes and Tao realized that they had found a problem to solve. The problem was that travellers needed a better way to find and connect with local tour guides.
Although Johannes and Tao had identified a problem to solve, as we are about to see, building a solution to this problem was much harder than initially anticipated.
GuideYourGuide: A peer to peer marketplace for student tour guides
Back in Zurich, Johannes and Tao communicated the problem they had discovered to the rest of GetYourGuide’s founding team. After some thought, the team envisioned a solution to this problem.
The proposed solution was a website where local students could register as local tour guides. Travellers would then connect with and book time with student tour guides via the website.
Fun fact: initially the team thought they had built a social network for student tour guides. It was only later on that when the media dubbed GetYourGuide as a peer to peer marketplace for tour guides that GetYourGuide realized what they had actually developed.
Version 1 of GetYourGuide is shown below.
“At the beginning, the idea started as students guiding students around. It was Couchsurfing for tours and activities.”
Tobias Rein, co-founder and principal engineer GetYourGuide
Once the team launched the GetYourGuide website, they set to work onboarding students and getting them to create tours.
In the first 18 months the platform aggregated a total of 200 student tours however, the team found that students were unreliable, often not available and had competing priorities such as course work and classes. This meant that they got almost no bookings in 18 months.
Co-founder Tobias Rein recalls, “with almost no tour bookings or any viable business model, it seemed like GetYourGuide was over”.
“We only managed to get a total of 4 bookings in the first 18 months and we collected a booking fee of only 5 Swiss Francs per booking.”
Johannes Reck, CEO and co-founder of GetYourGuide
Tour de Suisse: How GetYourGuide survived
At this point in the story, GetYourGuide had only been able to generate 20 Swiss Francs in 18 months. With no solution in sight and a business model that wasn’t working, the founders were close to giving up. However, before giving up on their entrepreneurial dreams forever, they decided to run a contest to see if this would help bring some traction to their site.
The contest was called “Tour de Suisse” and it was designed as a curation of the best tours in Switzerland. By chance, the contest was a huge success. This was primarily because it got a massive amount of press coverage. This caused a large influx of professional tour guides to sign up to GetYourGuide’s website.
A newspaper clipping from this event is shown below.
The traffic increase to GetYourGuide’s website allowed the founding team to learn two important lessons:
- First, in spite of the large amount of visitors to the website, GetYourGuide got zero bookings. This proved to the team that their business model definitely didn’t work.
- Second, whilst no new student tour guides signed up, they got a large number of professional tour guides who did sign up and list their tours. From this, the team realized that professional tour guides were their target audience and not student tour guides.
Armed with these two realizations, GetYourGuide adjusted their vision.
The problem was the same, travellers couldn’t find tour guides but now the team knew that they needed to (A) adjust their business model and (B) focus on connecting travellers with professional tour guides and not with students.
How GetYourGuide rebuilt their marketplace website
GetYourGuide’s team now re-programmed their platform as a B2C marketplace to connect travellers with professional tour guides.
These guides needed a slightly different set of features compared to students. For instances, professional tour guide certificates. The team worked with the guides to understand what features were needed and then implemented these.
After this, the team decided to worked closely with both the travellers and the tour guides in order to devise a business model that actually worked.
Eventually the team landed on a plan to to charge a commission (or take rate) for each tour booked through the platform. This allowed them to make approximately 25% commission on each tour booked through the GetYourGuide website.
A screenshot of GetYourGuide, version 2, is shown below.
After launching their new concept, the project took off like a rocket. GetYourGuide got:
- 70 bookings per week in 2010
- >1000 bookings per week 2011
- >10,000 bookings per week 2012
- And is continuing to grow today
How to build a website like GetYourGuide
Many marketplace founders think that technology alone is sufficient to build a website like GetYourGuide. Johannes Reck says that this is a misconception.
In reality, Johannes says that to build a website like GetYourGuide you need four key ingredients:
- A great marketplace idea
- A great product (idea execution)
- A great team and culture
- A little bit of luck (which you can create for yourself if you work hard)
Johannes highlights the relative importance of each of these ingredients in the following pie chart which is displayed below.
As you can see, Johannes places almost no value to the idea that the team had for GetYourGuide. This is unsurprising given that their initial idea of student run tours failed entirely. Rather, Johannes sees the idea as just the start of a journey that enabled them to eventually discover where the market actually was.
By contrast, Johannes places almost all of the value onto the team and execution. By team he is referring to the co-founding team and your first hires. The “execution” is the process of relentless iteration, fine tuning and adapting your marketplace, customer acquisition channels, business model and so on.
Let’s take a look at each of these components and see how to build a website like GetYourGuide.
Idea: The problem is fixed, your idea is flexible
Most successful entrepreneurs will tell you, ideas by themselves are worthless. This is mostly true. Successful businesses solve problems for customers and therefore rather than an idea for a solution, what you’re looking for is a problem to solve.
In the case of GetYourGuide, the founding team identified that travellers found it difficult to connect with local tour guides. Their idea for a solution was to use students as tour guides. However, GetYourGuide proved that this idea was not viable. Students were ultimately unreliable and didn’t know how to run tours. As such GetYourGuide pivoted their idea.
To build a website like GetYourGuide, you should therefore remember, your target customer and their pain points should be fixed in your mind. Meanwhile, your idea or product vision should be flexible.
How to build a great product like GetYourGuide
Once you have an idea for a website like GetYourGuide, the next step is to test the viability of this idea. To do this, you need to build an online marketplace MVP.
There are three main ways to do this:
Each of these methods has their pros and challenges. Let’s go through each of these options now.
Custom code
The main benefit of custom code is that it will allow you to build an entirely bespoke marketplace.
That being said, building a website like GetYourGuide’s with custom code is very expensive and time consuming. Typically you’re looking at anywhere from $50,000 – $250,000 just to get your MVP developed.
This kind of investment is a huge risk, especially if you’ve not proven that there is a market for your idea.
In the case of GetYourGuide, their initial failure meant that they had wasted all of their investment. In order to pivot, they then had to invest even more money which included asking their parents to remortgage their houses.
Furthermore, as we shall see shortly, nowadays there are marketplace technologies that you can leverage to start with a fully functional code base. With these technologies, building from scratch with custom code is totally a thing of the past.
Traditional no-code / low-code platforms
Traditional no-code / low-code platforms are solutions that allow you to build marketplaces with no or minimal coding.
These systems allow you to build faster than custom code so, for example, you will be able to build a marketplace for $10,000 – $20,000 investment.
The downside to these platforms is that they do not scale well and because they do not allow you to own your marketplace source code, you will need to rebuild your marketplace within 6 – 12 months.
Hybrid no-code
Hybrid no-code platforms combine the best of custom code with the speed of no-code platforms.
Using hybrid no-code solutions, you can build a marketplace 10x faster and without coding. All visual edits are then immediately transformed into full stack code. You can then either deploy your marketplace in one click or export the code and hand it off to developers.
Dittofi is one such a hybrid no-code platform that comes with expertly designed marketplace templates. Each template comes with all the must-have marketplace features that you need to build a website like GetYourGuide.
A summary of the different marketplace technologies is shown below. The graphic illustrates the trade off between possible customizations and speed of development.
For more information on how to build an online marketplace MVP with hybrid no-code, check out Dittofi’s marketplace templates.
Team: The never ending project, company culture
Building a great team and company culture is super important when it comes to building a business. To create a good company culture, you should be very cautious about who is on your co-founding team and who are the first people you hire.
Johannes Beck says that at GetYourGuide he was very lucky with his co-founding team. As the company grew the team focused very hard on making sure they hired employees who shared their teams characteristics. To do this, management was heavily involved in hiring and personally interviewed every early hire.
One of the key characteristics that the team looked for was, to ensure that each employee was motivated by the opportunity for personal growth rather than purely by money.
Luck: Work hard and create your own luck
GetYourGuide was very lucky to get their contest, Tour de Suisse into national newspapers.
However, as Johannes says, GetYourGuide would not have got national coverage without first throwing their hat into the ring.
Everything in life comes with an element of luck however, the harder you work and the more opportunities you create for yourself and consequently the luckier you are bound to get.
The lesson here is that, to build a website like GetYourGuide, you need to take action and get started.
How GetYourGuide raised funning and scaled
In 2023 GetYourGuide has raised $194 million at a $2 billion valuation. That’s pretty amazing if you think back to 2008 when the founding team were still students, with no real work experience and a failed product and business model.
In an interview with Inviable Media, Johannes Reck explains that to lead a successful VC led capital round, you need to first have a solution that actually works for your target audience and a business model that is suitable for investment. Once you’ve taken on investment, you need to be ready to grow since, at this point, you will be stepping onto a treadmill where you need to continually deliver growth. This means that you need two main things:
- Evidence of growth with your current business model;
- A clear path for future growth that you can communicate to investors.
“If you had given us $20 million of funding in 2010 we would have probably failed… you should bootstrap your company with thorough consideration first instead of taking on VC funding too early. ”
Johannes Beck, CEO and Co-founder of GetYourGuide
In order to demonstrate growth to institutional investors, you need need to track your marketplace metrics on both the supply and demand side. You then need to show consistent growth each year. For GetYourGuide this meant that their marketplace metrics were worst in 2010. Since then, their metrics have improved ever year, without fail.
GetYourGuide business model
The business model of GetYourGuide is mainly a commission-based business model. This means GetYourGuide charges a 20-30% commission fee (or take rate) on the total value of each transaction. The percentage is taken from suppliers on every booking made through the marketplace.
GetYourGuide also makes money by offering marketing services to their tour guides. This includes offering tour guides the opportunity to be a featured listing on their site.
For a list of the top marketplace business models, read The Top Marketplace Business Models – The Complete Guide.
GetYourGuide's value proposition
GetYourGuide’s greatest value is that it enables travellers to book a range of activities and services from a single platform, before arriving at a destination. The company’s various partnerships also enable users to access deals and offers that may otherwise not have been available.
The GetYourGuide platform is attractive to third-party tour guide businsess, as it enables them to advertise their products and services to a larger audience with no registration or listing cost. It also offers value to established affiliate partners which can generate revenue through marketing and integration.
GetYourGuide's marketing channels
GetYourGuide us a combination of paid and organic channels to drive traffic to their website GetYourGuide.com. These channels are primarily focused around keyword search that are optimized for through Search Engine Optimization (SEO) and paid keyword searches such as Google Ads.
In 2013 the company released an app that can be downloaded from the app stores. The app uses geolocation tracking to know where in the world travellers are. The app then serves push notifications, prompting tavellers to book online tours when arriving at a destination. This form of marketing is very direct and has allowed the team to grow their number of tour bookings.
GetYourGuide competitors
GetYourGuide competitors are other Online Travel Agencies otherwise known as OTAs that offer online tours. These include platforms like Viator, Klook, Airbnb, Peek and so on.
The market for online tours is split into two main segments. These are:
- Foreign tours market – these are tours taken by travellers who are visiting a destination.
- Local tours market – these are tours taken by people who live in the city as the tour operator and are looking for things to do in their spare time.
The foreign tours market is approximately $320 billion in size and the local tours market is $1.4 trillion. GetYourGuide compete’s in both the foreign tours market and the local tours market. In each space GetYourGuide must work to get their tours into the customers search results ahead of the competition.
For example, let’s suppose I am a traveller who wants to visit Montreal in Canada. Before departing I look to book a tour, so I visit Google and I type in “What to do in Montreal”, as shown below.
You can see that in the search results, GetYourGuide has a tour for “Hop on or hop off a double decker bus tour” and a “St. Lawrance sightseeing river cruise”. Alongside GetYourGuide’s tours are tours operated by GetYourGuide’s competitors. For instance, Viator are offering a “Guided Scooter Sightseeing Tour in Montreal” and local tours company Fever is offering “The AURA Experience at the Notre-Dame Basilica”.
Each of the tours is competing for the attention of a particular target audience. GetYourGuide and their competitors (1) strive to have the best and most diverse tours on their platform and (2) to get these tours into their target audience search results.
Below is a list of some of GetYourGuide’s competitors. For a more complete list and discussion on how these platforms compete with each other, read our article Viator Competitors – Top 7 Viator Competitors.
- Viator – The largest GetYourGuide competitor is Viator. Developed in 1995, Viator looks to differentiate itself by offering a wide variety of tours and activities that cater to a diverse set of interests, budgets and demographics.
- Klook – Second on our list of GetYourGuide competitors is Klook. Compared to GetYourGuide, This OTA targets a younger, tech savvy demographic in the Asia Pacific region. Klook achieves this by popping up in the social media feeds for their target audience. Meanwhile the products offered by Klook promote the use of city passes. These passes are designed for travellers to see as many places in a single day as possible. This allows the younger Gen-Z crowd to maximize their photo-taking opportunities to share with their friends.
- Airbnb – More recently the home sharing giant has started to upsell tours to travellers using their service. Airbnb’s tour products are very niche, focused on targeting travellers who are searching for tours that are off the beaten track. The platform primarily looks to grab users attention from within their Airbnb app.
- Peek – Finally, Peek is a GetYourGuide competitor that has a strong focus on the USA. It is a platform company with a marketplace add on. This means that Peek started by building a tool to help tour guide businesses sell their services, kind of like Shopify but for experiences. Once they had enough tour guides using their system, Peek began to focus on attracting travellers and match making them with the tours guides who already used their platform.
Marketplace Insider Tip
If you’re looking to build a GetYourGuide competitor, it’s very important to focus on solving a problem for a marketplace niche. Is there a section of the tours market that is not currently well represented? Is there a particular geography that you need to focus on?
Concluson: How to build a business like GetYourGuide
As we have seen, building a business like GetYourGuide takes time. The process is incremental and there are no short cuts that will jump you to the finish line.
The playbook to build a business like GetYourGuide’s is:
- Find an idea
- Build a lightweight marketplace website
- Test if you can attract buyers and sellers to your marketplace
- Learn and grow
At Dittofi, we specialize in offering world class marketplace technology that you can use to build a website like GetYourGuide.
For more information on this, schedule a call with our marketplace experts or read more about our marketplace solutions.
And… from the whole team here, we wish you the best of luck in your marketplace journey!
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