Travelzoo 2008 Annual Report Download - page 37

We will not be able to attract travel companies or Internet users if we do not continually enhance and
develop the content and features of our products and services.
To remain competitive, we must continually improve the responsiveness, functionality and features of our
products and services. We may not succeed in developing features, functions, products or services that travel
companies and Internet users find attractive. This could reduce the number of travel companies and Internet users
using our products and materially adversely affect our business.
We may lose business if we fail to keep pace with rapidly changing technologies and client needs.
Our success is dependent on our ability to develop new and enhanced software, services and related products to
meet rapidly evolving technological requirements for online advertising. Our current technology may not meet the
future technical requirements of travel companies. Trends that could have a critical impact on our success include:
• rapidly changing technology in online advertising;
• evolving industry standards, including both formal and de facto standards relating to online advertising;
• developments and changes relating to the Internet;
• competing products and services that offer increased functionality; and
• changes in travel company and Internet user requirements.
If we are unable to timely and successfully develop and introduce new products and enhancements to existing
products in response to our industry’s changing technological requirements, our business could be materially
adversely affected.
Our business and growth will suffer if we are unable to hire and retain highly skilled personnel.
Our future success depends on our ability to attract, train, motivate and retain highly skilled employees. We
may be unable to retain our skilled employees, or attract, assimilate and retain other highly skilled employees in the
future. We have from time to time in the past experienced, and we expect to continue to experience in the future,
difficulty in hiring and retaining highly skilled employees with appropriate qualifications. If we are unable to hire
and retain skilled personnel, our growth may be restricted, which could adversely affect our future success.
We may not be able to effectively manage our expanding operations.
Since the commencement of our operations, we have experienced a period of rapid growth. In order to execute
our business plan, we must continue to grow significantly. As of December 31, 2008, we had 214 employees. We
expect that the number of our employees will continue to increase for the foreseeable future. This growth has
placed, and our anticipated future growth will continue to place, a significant strain on our management, systems
and resources. We expect that we will need to continue to improve our financial and managerial controls and
reporting systems and procedures. We will also need to continue to expand and maintain close coordination among
our sales, production, marketing, IT, and finance departments. We may not succeed in these efforts. Our inability to
expand our operations in an efficient manner could cause our expenses to grow disproportionately to revenues, our
revenues to decline or grow more slowly than expected and could otherwise have a material adverse effect on our
business.
Our operations may be adversely affected by changes in our senior management.
Effective October 1, 2008, Holger Bartel was appointed as Chief Executive Officer of the Company, replacing
Ralph Bartel, who had served as Chairman of the Board of Directors, President and Chief Executive Officer since
the founding of the Company. Ralph Bartel continues as Chairman of the Board. Holger Bartel is the brother of
Ralph Bartel. He served as Executive Vice President of the Company from 2001 to 2007, and has served as a director
of the Company since 2005, and has extensive familiarity with the business and operations of the Company.
However, there can be no assurances that these changes in the senior management of the Company will not have an
adverse effect on the business of the Company, temporarily or otherwise.
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