Banking giant Capital One has acquired Boston travel tech startup Lola.com’s workforce and software, in a bid to expand its financial technology presence in the Boston area.
Lola cofounder Paul English and chief executive Mike Volpe will join McLean, Va.-based Capital One and help oversee the bank’s tech operations in its new Kendall Square office. Lola, meanwhile, has shut down, closing its office near South Station and ending its corporate contracts, with refunds given to clients who were owed them.
The COVID-19 pandemic hammered Lola’s business travel revenues, forcing the company to pare its workforce and reexamine its future. The firm — led by English, who was its chief technology officer, and Volpe — pivoted last fall to broaden its scope to develop a suite of expense-management offerings beyond travel.
Now, the remaining 57-person Lola team will pivot again, this time as employees of Capital One. (Eight people from Lola were not offered a job at Capital One, Volpe said, or didn’t want one.) They will help Capital One develop payment-related products and services for business customers, an outgrowth of the group’s expense management work.
The employees will join roughly 250 Capital One tech workers already based at the bank’s Cambridge office, which opened in Kendall Square last year. Capital One completed the acquisition of Lola’s intellectual property from its investors — a group that included VC firms General Catalyst and Accel, as well as English and Volpe — and the mass hiring of Lola workers on Thursday, Volpe said. It’s part of a broader push by Capital One to expand its fintech workforce.
“They want Boston to be another large hub,” Volpe said. “We’re going to be doing a lot of hiring here, a lot of growing.”
Volpe will help manage the development of Capital One’s business-to-business payment offerings, while English will be an entrepreneur-in-residence of sorts, advising on innovation throughout the company.
“It’s an innovative, ‘tech forward’ culture, especially for a large bank,” English said. “I’m excited about developing more expertise in fintech, and bringing more fintech jobs to Boston.”
The deal with Capital One grew out of discussions Volpe and English were having with various potential investors and financial companies aimed in large part at raising more money. Lola board member Susan Sobbott, a former American Express executive, introduced the Lola leaders to top brass at Capital One.
This turn of events for Lola is quite different from what happened to Kayak.com, another travel tech company that English cofounded. Kayak’s stock became publicly traded in 2012, and the travel search engine was acquired for nearly $2 billion by Priceline.com, now known as Booking Holdings, the following year. (Lola investors General Catalyst and Accel were backers of Kayak, too.)
After leaving Kayak, English launched a startup incubator called Blade in Fort Point. The idea for Lola, initially envisioned as a travel assistance app geared primarily for leisure travelers, emerged there. English put the Blade team’s entire efforts toward developing Lola, and launched it as a standalone business in 2015. It became far more popular among business travelers than he first expected. Volpe, a former chief marketing officer at Cybereason and HubSpot, joined Lola in 2018. The Boston company had a banner year in 2019. But in 2020, those grand plans fell apart, and nearly half of the firm’s workforce was cut after business travel plunged during the pandemic.
“We’ve had a lot of ups and downs,” Volpe said. “We’re really proud of the team and the resilience they’ve shown.”