Business with Miton signed on a napkin in a pub. 16 years later, the company was sold for billions

Miton investment group, e-commerce players Mall and its (now for the second time) mother Allegro, Jakub Havrlant… These are already well-known names in Czech e-commerce and billion-dollar businesses. However, during the last sixteen years, the lesser-known story of Pavel Kotas, co-founder of Previo and the portal, also revolved around them. Since 2019, it has been part of the Hungarian group Szallas Group, but the Czechs held a stake in it until last September, when the service combining accommodation offers of hotels in the Czech Republic and Slovakia was sold for 82 million euros, then roughly two billion crowns, to another regional giant Wirtualna Polska.

How does it feel when a person sells a company for more than two billion crowns? “Such deals do not happen every month in the Czech e-commerce sphere, but the sale of a company as such is actually nothing new for me, we have already experienced something similar historically. Now it was a transaction that started five years ago and we completed it a few months ago. The valuation is a confirmation of the success of the portals, which did not have it easy all the time and almost ended several times,” describes Pavel Kotas for CzechCrunch.

The sale of is for a forty-two-year-old entrepreneur, who started as a programmer, completing an important life chapter. At the same time, he got into programming already in elementary school, during high school he started to earn a little extra money with it and continued to do so even after his studies. he remembers.

In 2003, Kotas got the opportunity to create a website for a small guesthouse in eastern Bohemia. The client was satisfied with the result, but he lacked a reservation system. Kotas didn’t want to give up on a potential job and agreed to create that one as well. “At that time I was already working with several colleagues and we expected that it would be a job for three months. In the end, the development of the first basic usable version took a year, but we had to keep coming back to develop other functionalities,” describes.

We drank a lot of greens. At four in the morning we wrote on a napkin that I would have 30 percent and the boys 70 percent. This is how we signed the transaction.

He came to the decision that since they are going to develop a complex system, they will start offering it to other clients as well. Kotas managed to convince friends and acquaintances to start using it. One of them was, for example, Lukáš Pytloun, who at the time ran a small hotel and today, with his network, is one of the largest hotel players in the Czech Republic. The year 2006 subsequently became a turning point, when Kotas joined forces with the investment group Miton.

“I knew the guys from the dorms, and they also had projects like for hosting websites or the portal, so we were always close to each other. We once met at the cottage of Tomáš Matějček (one of Miton’s partners – editor’s note) and we agreed that we should combine the projects – our reservation system and their tourist portal – says Kotas.

Kotas prepared for the meeting – he wrote down what he had in the company on a piece of paper. In addition to about two hundred clients, there were three computers, two printers and two employees… He priced everything at 700,000 crowns. With the fact that Miton wanted to invest 300,000 crowns in the new project, he expected that they would divide the share in the ratio of 70 to 30 and make a deal. Which turned out somewhat differently.

“The boys took me to a pub, where we drank a lot of greens. At about four in the morning we wrote on a napkin that I would have 30 percent and the boys 70 percent. This is how we signed the transaction. But they were right, I looked at the value of the company naively. I was used to doing custom web production, scaling a product meant something else. I changed my perspective and started to enjoy it much more,” recalls Kotas.


Photo: Miton

Miton partners: Ondřej Raška, Milan Zemánek, Michal Jirák, Tomáš Hodboď, Tomáš Matějček and Václav Štrupl

Miton thus became the first investor in the newly renamed company Previo, which was engaged in the development of hotel systems . The portal became a sister company in 2008, and Kotas, as director of Previa, was tasked with bringing the business of these two companies together. They continued to operate independently, Previo from Prague and from Liberec, but relied on a common business proposition.

Both services helped hoteliers sell accommodation through, but in order to do so, the owners had to first accommodation facilities to implement Previo, through which they entered data about available rooms or prices into the system. “But the software was more complex, we wanted to become a full-fledged hotel management system. At that time, many of them heard about the online proposition that they can take care of their hotel from anywhere and from any device via the Internet,” says Kotas.

The following period between 2009 and 2012 then rates almost as a “golden era”. The business grew twice as much every year, operated profitably, and there was no widespread competition on the market like, which was gaining traction at the time. beat other players here. “For example, the portal ubytování.cz bought Seznam, but closed it after a year, because it was very difficult to fight against us,” smiles Kotas.

It was at this time that’s activities were also noticed by the Polish company Allegro, which, thanks to its South African parent Naspers, significantly financed the expansion activities. Over the years, for example, it also owned, Heureka, Mall Group now owns it for the second time – and according to CzechCrunch’s findings, whenever it bought Czech projects,

then sold back to Czech Republic with a loss.

Allegro, in addition to other activities across several countries, also built travel portals, and therefore in 2012 bought from Miton and Previo. However, it subsequently failed to utilize their full potential. The market was starting to become significantly more competitive, for example the already mentioned began to expand a lot.

“In 2010, Slevomat was also established, where Miton was one of the investors. I knew Tomáš Čuper, we were classmates at the gymnasium, so I saw the events up close. I didn’t believe that anything would come of mass discount events, for which we ended up paying extra. We also operated a discount section on the portal, where we offered wellness stays on sale, and Slevomat quickly overtook us in this segment,” Kotas admits, adding that the situation was not ideal even internally in the company .

“Originally there were three of us in management, except for me, Tomáš Matějček and Jan Davídek, who quickly left the company after the sale. I became a director somewhat out of compulsion, leading a team of a hundred people and falling under the Polish leadership. Their primary goal was to have properly set up reporting, to do training for employees, Allegro drew attention to processes. Instead of focusing on business and trade, we dealt with the fulfillment of every legislative requirement that corporate lawyers came up with,” continues.

For these reasons, it stagnated as a company in 2012 and 2013, and Allegro decided to get rid of it relatively quickly after the acquisition. Kotas, as a director, became an intermediary in the negotiation of the transaction, the travel agency Čedok was the most interested, but in the end the agreement was canceled just before the signing. Jakub Havrlant, then from the position of regional director of Allegra, thus gave Kotas the task of finding a new buyer by the end of 2013.

I basically got a few weeks to find a new buyer.

“ It was December, so basically I had a few weeks,” recalls Kotas’ difficult time. However, because he was well aware of the details of the transaction, he decided to offer the same offer to buy Allegra together with several other managers. “We asked Allegro to give us a few extra months to pay for the transaction and we slapped each other. We all got into a lot of debt, but at the beginning of 2014, belonged to us again.”

Because the new owners put all their life savings into the company, its development really shoes. “We had to grab it. We knew how to do it because we had done it before. We invested a lot in marketing and business, we didn’t even pay our salaries in the beginning. Within a year, however, we turned the situation around, started making money and paying off debts,” says Kotas, adding that the results eventually surpassed even the most optimistic options. continued to do well , always focused on the local travel of Czechs in the Czech Republic. In 2017, the Hungarian portal, which focused on tourism in its market, contacted the owners. “We didn’t even know them, but we were intrigued by their vision of building a Central European player, so we hit it off,” describes Kotas, adding that together with his colleagues, he became a shareholder in Szallasi.

The transaction, which only concerned hotel portals and which did not include hotel systems developer Previo, was completed in 2019 – a few months before the outbreak of the global pandemic. Even though the situation in its beginnings did not look promising and orders for accommodation fell to zero, the last years finally brought a literal boom in local tourism, when people traveled at home due to various restrictions and did not cross the border.

The group also grew rapidly., which also includes the, and portals. Last year alone, it delivered approximately 120,000 reservations for half a billion crowns to Czech and Slovak hotels, an average of more than 300 confirmed reservations per day. In addition, there was another change of owners this year.

In September, the entire Hungarian Szallas group was bought by the internet and media company Wirtualna Polska, whose shares are traded on the Warsaw Stock Exchange. The transaction took place in the amount of 82 million euros, at that time over two billion crowns, and several Czech shareholders who still held shares in Szallas were also paid out. In addition to Kotas, it was Milan Petr, Richard Šipoš, Lukáš Čívrný, Petr Klas and Tomáš Pětivoký.

“For me, it is the closing of one life chapter. I withdrew from the more active management of two years ago so that I could devote myself fully to the development of Previa,” says Kotas. In addition to the reservation system, the company offers reception software, the creation of hotel websites, an application for cleaning management and the Alfred application for guests, as well as connections to 250 other reservation systems such as Booking.

In the Czech Republic with the number one overview

Previo is used by over 3,600 accommodation providers in Europe and more than two thousand hotels in the Czech Republic alone and guesthouses, which gives it a market share of 25 percent – it is clearly number one. On the Hungarian market, the company is fighting for the number one position with a competing player, it also operates in Slovakia and has been gradually trying to break through in Poland in recent years. The goal now is to become an important regional player, in the long term in eight markets.

Despite previous sales and acquisitions, Kotas now believes that Previo is his long-term project and is not going to leave: “I used to think that if I sold the company, I’d work for a few more years and retire at 35, I’d just roll around on the beach. As a 40-something, I’m now hopefully past my midlife crisis and realizing how much I enjoy work. Moreover, now after the sale of Szallas to Poland, I am also financially secure with my family,” describes Kotas.

“Every time we talk about it in Previ , how to further develop our software and help hoteliers, I think it’s great to have such a company. Even if I sold it for a lot of money, in a few months I would get bored and have to build something again. And I don’t want to get into something from the absolute peak anymore. As long as I feel that I am an asset in the company, I will continue to develop it,” uzavírá.


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