Replies to post #115620 on Lehman Brothers Financial SA (LEHNQ)

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The deal included a provision that if Tenaya Capital reached certain performance milestones, Lehman would receive a percentage of the profits. However, this was a performance-based payment, not an ongoing ownership interest.

While specific investment returns are not publicly detailed for every Tenaya Capital consumer internet investment, available information suggests that Kayak and Zappos were among the most successful, with Kayak in particular mentioned as seeing a notable exit.
Explanation
Kayak: The online travel search engine achieved a public exit (IPO and eventual acquisition), which is a key indicator of significant growth and a successful return on investment for venture capital firms like Tenaya Capital. Its success was due to its innovative business model as a comprehensive search engine for flights, hotels, and travel services, which efficiently served consumer needs in a growing online travel market.
Zappos: The online shoe and apparel retailer experienced substantial growth that led to its high-profile acquisition by Amazon, another strong indicator of a highly successful venture capital exit.
Why the growth was significant
The significant growth of companies like Kayak and Zappos was driven by a combination of market need, innovative technology, and the ability to scale rapidly:
Strong Business Model: Both companies addressed large consumer markets (travel and retail) with efficient and user-friendly platforms that disrupted traditional models.
Scalability: Their internet-based models allowed for rapid scaling and wide market reach without the physical limitations of brick-and-mortar businesses.
Successful Exits: Achieving an IPO with Kayak and an acquisition by a major tech giant like Amazon for Zappos represents substantial financial growth and validation of their market positions.
While Lyft has also seen massive growth and is a well-known company, the specific details comparing its performance relative to the final returns of Zappos and Kayak for Tenaya Capital are not as explicitly highlighted in the search results. Similarly, Qunar was a significant player in the Chinese market, but direct comparative data on which yielded the highest return for Tenaya Capital is not available.