Wanderu Adds $5.6M, Wants to Become Big Consumer Travel Brand

Is consumer tech finally taking off in the Boston startup community? The broad answer still seems to be no. The city’s enterprise-focused roots remain dominant. But there are exceptions.

Wanderu is one of them. The online travel-search company has just raised a $5.6 million Series A funding round led by new investor Metamorphic Ventures. Other participants in the round include Alta Ventures, 500 Startups, Barbara Corcoran Venture Partners, former Greyhound CEO Craig Lentzsch, and VC Brad Feld, who invested as an angel. The startup previously raised a $2.45 million seed round in 2013.

Wanderu provides ground-travel search for people looking to go from, say, Boston to New York. It bills itself as “Kayak for buses.” So perhaps it’s not surprising that Kayak co-founder Paul English has been an informal advisor to the startup. (English has been busy running his consumer-tech foundry, Blade, which Wanderu is not affiliated with.)

It hasn’t been easy thus far. CEO Polina Raygorodskaya describes “challenge after challenge on the technology landscape.” Similar to companies like ITA Software (now part of Google) on the airline ticketing front, Wanderu found no data standards, no application programming interfaces, and “no easy way to plug in and get the data” in the bus industry, she says.

Nevertheless, the 17-person company has done its part to help standardize bus reservations since rolling out in the Northeast in August 2013. Wanderu now has partnerships with companies like Greyhound, Megabus, BoltBus, and Peter Pan Bus, allowing its service to cover about 70 percent of the U.S. and parts of Canada. It is going after a relatively young user demographic of 18-to-35 year olds, and expects to release a mobile app for iOS by the end of 2014.

Some are tired of hearing this, but Boston’s big consumer-tech companies remain few and far between. There’s Wayfair, Kayak, TripAdvisor, Zipcar, Bose, iRobot, and a few others.

Raygorodskaya sees it differently. With the rise of Blade, PayPal’s Start Tank incubator, and other programs, a slow shift may be occurring in the local ecosystem. “We’re starting to see more consumer startups. That’s exciting and important,” she says. “When we were starting out, it didn’t feel like we were a good fit in Boston.”

A new generation of startups, from CoachUp to DraftKings to Drizly, has joined more established consumer-focused companies like RunKeeper and Gazelle. Whether this amounts to a critical mass remains to be seen.

Still, it’s notable that none of Wanderu’s venture investors is local. “I wish there were more consumer-focused funds in Boston,” Raygorodskaya admits. “I hope there will be consumer exits, and those people will end up in the VC world and will start funding consumer startups.”

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and Editor of Xconomy Boston. E-mail him at gthuang [at] xconomy.com. Follow @gthuang

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  • Congrats Polina–you did not show any signs of breaking a sweat over this financing when we met last month at Builders and Innovators event. Well done.