Quitting business: Jovago packs up as parent company withdraws support

Hotel booking portal could not find new investor to keep operations running

KARACHI: Jovago, the web portal featuring thousands of hotels, motels and guest houses that booked online rooms for domestic and foreign tourists in Pakistan, has announced that it is winding up its business as the parent company has parted ways and left it alone to find a new investor.

“Sorry, Jovago.net is permanently closed and is no longer in business,” these were the words travel-lovers found written on Pakistan’s biggest online hotel-booking site on Saturday. “Every journey comes to an end. This is the end of our journey.”

Germany-based Rocket Internet - one of the biggest companies in the world which supports and invests in online companies - was the parent company of Jovago in Pakistan.



Last year in Africa, Jovago merged with and into a global hoteling portal Jumia Travel as it began its journey in the region from Nigeria.

A market source revealed that Rocket Internet stopped backing Jovago in the wake of sluggish response to the portal in Pakistan and asked it to find a new investor. Jovago wound up the business after it failed to court a new investor.

He said the parent company, whose business was to invest and help flourish online companies, had invested in Jovago to groom and later sell it to suitable investors.

Market intelligence publisher Euromonitor International, in a forecast for 2017-22 in terms of disposable income, lists Pakistan among the top-10 growing markets.

According to the Pakistan Tourism Development Corporation, the number of domestic and foreign tourists in Pakistan, which was 1 million in 2010, is going to double to 2 million by 2025.



Separately, the British Backpacker Society recently ranked Pakistan  first among top-20 adventure travel destinations. Despite an environment conducive for online business and being in the market with no or little competition, Jovago was not quite profitable. According to market sources, the holding company asked Jovago administration to meet its own expenditures or search for an investor.

The company then approached many domestic and foreign investors for fund injection into expanding its operations, but it could not meet success. Rocket Internet’s business model is to nurture start-ups outside of the US and Europe so that they could be sold to those groups that look for acquisition of mature businesses.

Jovago was expected to make enough money that a businessman would like to keep the operations running, but Rocket Internet shut it down because it was earning less-than-expected revenues.

“We are exiting which is not a bad news; the website is temporarily shut down; I cannot comment further since it is confidential information,” said a senior official of the company, while talking to The Express Tribune.

Jovago, when it started operations in Pakistan in May 2014, had only four employees. The web portal was the first of its kind and it did not encounter any competition, growing to 50 employees by mid-2016.

The group has a history of wrapping up operations. Earlier, it merged Kaymu operations into Daraz’s and in February 2017, it closed down Tripda - a carpooling website - and secondhand goods marketplace Sparklist, which was once among top-three most downloaded apps in Pakistan.

“Jovago’s closure is an opportunity for the local players as it is clearing the market and it is the best time to make such an investment,” remarked Secretary General Shehryar Hydri.

Published in The Express Tribune, December 31^st, 2017.

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