While many startups are struggling to get additional funding in a hurting economy, online vacation rental site HomeAway on Tuesday announced a monster $250 million in new funding led by Technology Crossover Ventures.

The financing with returning investors Institutional Venture Partners and Redpoint Ventures represents the largest investment of a U.S. Internet company in the last eight years, according to Dow Jones VentureSource.

The Austin-based startup had already grabbed a dazzling $209 million over two rounds since its inception in 2005.

The colossal initial investments helped the burgeoning company to acquire five vacation rental sites including CyberRentals.com in the U.S., Holiday-Rentals.co.uk in the UK, and FeWo-direkt.de in Germany. With a total of 11 acquisitions under its belt, HomeAway has managed to become in less than four years the leading online vacation rental web site.

With the new funding, HomeAway is expected to gobble more competing companies.

“This financing gives HomeAway significant resources to accelerate both organic growth and growth through strategic acquisitions,” said Todd Chaffee, general partner at Institutional Venture Partners, in a statement.

That a vacation rental site might flourish during a time of recession might seem counterintuitive, but HomeAway makes a compelling case in explaining how a slowed-down economy is an engine of growth in the vacation rental business because renting a home often is cheaper than staying in a hotel.

“The success of HomeAway and the growth of the vacation rental industry are being driven by travelers who seek affordable accommodations, and by owners who have learned that they can earn significant income from their vacation home investments,” said Brian Sharples, chief executive officer and founder of HomeAway

Owners of vacation homes are more likely to try to rent their properties during a downturn to offset market losses, according to the National Association of Realtors.

“There are nearly 14 million vacation home owners in the U.S. and Europe, and most are still not aware of how easy and profitable it can be to rent their homes. We plan to increase our marketing substantially over the next couple of years to further the awareness of the industry,” Mr. Sharples said in the statement.

Also, unlike other service-oriented web sites, HomeAway does not depend on advertising to generate revenue. Its business model is subscription-based, and the company charges home owners a one-time fee of $275 per year to list their rental properties.