This is the second notable acquisition of an AI company in the travel industry this week. It follows Airbnb’s purchase of GamePlanner.AI.
Mondee has acquired an AI company called Purplegrids in an all-stock deal valued at roughly $19 million.
Mondee primarily provides travel agents with a tech platform for making wholesale bookings on behalf of customers. The company in July released an upgraded version of its travel booking platform that is integrated with the latest advancements of AI and includes a chatbot called Abhi.
The AI tech developed at Purplegrids includes large language models (the base of its generative AI tech), computer vision, deep learning, and more. Many of its clients have included non-travel companies, according to its website.
Mondee has big plans for the tech, according to Orestes Fintiklis, vice chairman for Mondee and the company’s chief corporate strategy and business development officer.
“The plan is to apply it everywhere in our business,” Fintiklis told Skift.
Mondee plans to leverage Purplegrids to improve its AI travel assistant as well as integrate AI throughout the company, such as back-office work like sales and marketing.
“Once you have an AI tool incorporated with your entire sales and marketing strategy, then you can deploy marketing dollars much more cost efficiently and produce much more powerful results,” Fintiklis said.
The deal was completed in stock only, about 1.9 million shares valued at $10 each. Mondee’s stock price started above $10 this year but has since dropped below $4.
“Which basically shows how much value they attach to Mondee and also how much they believe that they will be able to influence the AI trajectory of Mondee,” Fintiklis said.
Purplegrids was founded in 2017 by Joseph John and Shibi Sudhakaran and is based in Silicon Valley. John, CEO of Purplegrids, previously spent 12 years as a tech leader at Apple and four years at Oracle. Sudhakaran has had multiple leadership roles at PayPal and Sun Microsystems.
The founders and the other more than 50 team members, with experience at companies like Google and Meta, are joining Mondee. Some of them will integrate into the larger Mondee company, and the others will remain as part of a Mondee subsidiary, Fintiklis said.
Mondee’s First Tech Acquisition
Mondee contracted Purplegrids over a year ago to help develop its latest AI-powered platform, which also includes next-generation aspects like a shopping cart.
“And then halfway in the process, they realized how much their platform improved by using all of our data. And then we realized how much more we can do if we just own all of [it],” Fintiklis said. “They were not intending to be sold; they were not looking for any funding. It was just out of a collaboration, it appeared clear to both sides there are huge synergies here.”
This is Mondee’s fifth acquisition of the year and its 19th to date. But it’s the first time the company has purchased a tech company, having been focused on consolidating the siloed travel agency market.
The announcement comes the same week Airbnb acquired an AI company called GamePlanner.AI.
Mondee reported during an earnings call this week that it has secured $161.2 million in revenue this year through the end of September, an increase of 29% from the year prior.