- Spencer Rascoff is the CEO of real-estate website and app Zillow. He was previously the CEO of travel website Hotwire.
- Rascoff learned that Hotwire had unknowingly sold some of the plane tickets to 9/11 hijackers.
- At the same time, few people were travelling, and so Hotwire ended up going through significant layofffs and a down round.
Within two days of September 11, 2001, Spencer Rascoff was on a flight from Newark to San Francisco. He’d just spoken at the Millennium Hilton at World Trade Center.
At the time, Rascoff was the CEO of Hotwire, the travel website he’d cofounded just two years earlier.
As he wrestled with the eerie feeling that he’d narrowly escaped his own demise, Rascoff learned that he’d lost a family friend on the plane that crashed in Pennsylvania.
What’s more, tens of thousands of Rascoff’s customers were now stranded across the globe, after having bought airline tickets and hotel reservations through Hotwire.
But for Rascoff, now the CEO of real-estate website and app Zillow, that was hardly the worst of it. Soon he would discover that Hotwire had unintentionally played a role in the 9/11 tragedy.
On an episode of Business Insider’s podcast, “Success! How I Did It,” Rascoff told Business Insider US editor-in-chief how he realised that Hotwire had sold plane tickets to some of the hijackers:
“It wasn’t the September 11 flights, it was the flights a couple of days earlier that put the team in place in Bangor, Maine, and then they flew from Bangor to Logan. I think the way we found out about it was the FBI told us, they came knocking, I think, probably that day or within a couple of days.
“And it cast this really awful shadow of culpability over the company. So as we were struggling with dislocated customers, employees who we weren’t sure of their location, and then there’s the shadow of this weird connection to the actual tragedy itself.”
Because relatively few people travelled in the months following the tragedy, Hotwire ended up conducting “significant layoffs.” Rascoff explained how the company handled the whole experience:
“We did a down round” — a round of financing that values the company at less than the previous round — “which wiped out a lot of the equity that the employees had in the company. To our credit, two years later we had turned the company around and pulled through all of that trauma and sold the company successfully to Expedia for about $US700 million.”
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