honoluluadvertiser.com

Sponsored by:

Comment, blog & share photos

Log in | Become a member
The Honolulu Advertiser
Posted on: Thursday, July 11, 2002

Viata Software to split into two for survival

By John Duchemin
Advertiser Staff Writer

Travel software firm Viata Software Inc. will split into two companies, a move that managers said could help the startup company not only improve its services, but also survive an industrywide cash crunch.

Viata, a 20-employee firm based in downtown Honolulu, will spin off one company focused on its EzRez suite of back-end booking software, and another company based on VacationHosts.com, an online portal for Hawai'i vacation rentals.

The goal is to create two streamlined companies from one relatively amorphous firm, which could make it easier for each of the spinoffs to raise much-needed money, said Heidi Vavul, director of project development for Viata.

Viata has been developing its software and gradually adding clients since receiving $1 million in seed capital last fall.

But the company, like many other tourism and technology businesses, has struggled since Sept. 11 to attract clients and raise cash. Former chief executive J.W. Ellsworth resigned in May, and no replacement has been named.

Investor Kitty Lagareta, one of several local businesspeople to put money in Viata, said the company is "having some issues over funding," but declined to discuss details.

Vavul said money isn't the main problem. She pointed instead to a lack of focus caused by the company's twin product lines.

"In any startup company, funding is always an issue, but that's not the reason for this split," Vavul said. "It's just much cleaner to separate the two from an investment point of view. This is a positive move."

Viata started in 1998 by developing VacationHosts.com, a site that offers online booking for several hundred vacation units in Hawai'i.

By 2001, the company had expanded into online reservations systems, signing such clients as Outrigger Hotels & Resorts and charter air company Hawaiian Vacations.

In October 2001, Viata announced that it had received about $1 million in seed capital from investors, including John Dean, chairman of Silicon Valley Bank.

Reach John Duchemin at 525-8062 or jduchemin@honoluluadvertiser.com.