Launched in 2000, Hotwire was founded by a team of 4 scrappy entrepreneurs: Karl Peterson, Eric Grosse, Gregg Brockway, and Spencer Rascoff. Hotwire was lucky enough to receive an impressive initial investment of $75 million from private equity firm, Texas Pacific Group. Fortunately for the company, Karl Peterson used to work at Texas Pacific Group, giving Hotwire the sort of upper hand that other startups merely dream of.
At the beginning, Hotwire offered discounted flights from 6 major airlines, all of which were also early investors in Hotwire. The airlines were Northwest (now known as Delta), American Airlines, Continental (now United), American West (now American), and US Airways (now also American). Interestingly, Hotwire was internally referred to as Purple Demon prior to its launch.
By the time September of 2003 had rolled around, Hotwire would already be acquired for the first time. IAC/InterActiveCorp purchased Hotwire for a cool $663 million … not too shabby if you ask me. The following year, an internet research firm estimated that Hotwire (along with cross-promotion with Expedia, IAC managed to reach an additional 1.5 million visitors per month to both sites respectively.
Hotwire.com began their business by selling only opaque airline tickets (meaning that customers could see departure and arrival times, but not the specifics of what airline they would get). It took them only a few months to expand their business exponentially, by selling opaque hotel bookings and rental cars as well. Vacation package offerings came around in 2003, and in 2004 Hotwire began selling retail travel products. 2007 marked a major landmark for the site, as in January of that year, Hotwire removed all booking fees for airfare.
Today, of course, Hotwire stands tall as one of the giants of the online travel booking industry. There are only a few sites out there that compete with Hotwire, and most of them are sister sites, also a part of the broader Expedia Group. Hotwire has solidified their spot among the best hotel booking sites to ever exist, without a doubt.