“In the real world outside economic theory, every business is successful exactly to the extent that it does something others cannot. Monopoly is therefore not a pathology or an exception. Monopoly is the condition of every successful business….Tolstoy opens Anna Karenina by observing: ‘All happy families are alike; each unhappy family is unhappy in its own way.’ Business is the opposite. All happy companies are different: each one earns a monopoly by solving a unique problem. All failed companies are the same: they failed to escape competition.”
– Peter Thiel, Zero to One
1. Preaching what we don’t practice?
A lot has been written this week (CNBC , Skift, etc…) about eight influential German travel start-ups criticizing Google for not restructuring (cancelling, reducing or delaying) ad payments linked to travel and transport bookings that were subsequently wiped out by the Covid crisis. The complaint is that Google is not “sharing the burden”. I wonder if GetYourGuide, Trivago, HomeToGo and others (which have raised a total of $2.1 billion to date, not including Trivago’s IPO nor its sale to Expedia) are themselves extending towards their own advertisers and suppliers the level of debt forgiveness, generosity and flexibility that they demand from Google. Let me know if you have any insights about this. But as the tweet below points out, it does seem like at least GetYourGuide is not shy about using its strong and dominant position towards its suppliers. “Everyone is upset with the company one layer closer than them to the customer”…well said.
2. Why do all news photos make beaches look like Covid hotspots?
As if the travel sector wasn’t facing enough of a struggle, many news outlets add fuel to the fire by misleading the public into thinking that the beaches and other outdoor environments are the leading cause of Covid spread. Harvard Epidemiologist Julia Marcus writes: “The media’s misinformation campaign continues on the front page of the Sunday New York Times…You’d think from the moral outrage about these beach photos that fun, in itself, transmits the virus. When people find lower-risk ways to enjoy their lives, that’s actually a public-health win”. Zeynep Tufekci, who has been tracking such examples across media outlets in this twitter thread, sums it up: “For the New York Times to use visuals of perhaps the three safest but fun activities—a beach, a park, and a drive-through movie, as a photo for virus’s resurgence is straight up misinformation. And it’s pathological”. Traditional media is also in a crisis, but theirs won’t end with a vaccine. (Read more - Nieman Lab).
3. Airbnb confidentially files for an IPO
If it does take place, it would be one of the most widely anticipated IPOs in recent history. Airbnb will be forced to make significant disclosures and disclose information as part of the IPO process, but because the S-1 form was filed confidentially, those disclosures will be withheld until later on in the process. Airbnb’s business seems to be recovering after the company cut 1,900 staff and raised $2 billion in debt and equity in April at a reported valuation of $18 billion (a steep decline from its $31 billion valuation in 2017). Airbnb marked an important milestone on July 8 when guests booked more than 1 million nights’ worth of future stays at Airbnb, a volume it hadn’t seen since March 3. Read more.
4. Private travel is the new luxury
The former CEO of Surf Air and Frontier Airlines has launched Manifest, an exclusive travel club that creates unique travel experiences for its members with custom-crafted getaways within the US via private jets. Manifest will have club “chapters” in the top 50 US source markets. The first chapters available to join now include Denver, San Jose and Los Angeles. San Diego, Santa Barbara, Phoenix, San Francisco, Oakland and Las Vegas are set to open in 2020/2021. Only 175 memberships will be available per city. The cost for members is $2,500 per year. Example of experiences: 3 day Santa Fe yoga and wellness ($5320 per person), 3 day Aspen photography ($6530 per person). The Colorado-based company has received $2 million in funding and is currently raising a seed round. Read more - Phocuswright.
5. Enabling the contactless journey: Biometrics and digital identity in travel
Removing friction — literally and figuratively — to deliver more enjoyable customer experiences has been a mandate at JetBlue Technology Ventures since pre-Covid days. Now even more so. Jim Lockheed from JTV wrote an interesting post that covers biometrics and digital identity in travel, current challenges that point to the need for new solutions, notable approaches and companies in the space, and what’s coming next. On a related topic, WSJ has published an interesting vision of the future of air travel (paywall) and how airlines and technology companies are developing artificial intelligence to ease the door-to-door journey.
6. Flying with Microsoft
We’ve got Microsoft to thank for some of the best flying we can do these days. Microsoft launched the video game Flight Simulator in 1982, but it got a major update on August 18, 2020. A columnist for The New York Times recently tested out the new game, but his experience led him to a number of conclusions that had nothing to do with gaming and everything to do with how we relate to the world, both digital and analog. “I found it to be most compelling as a preview of a new kind of digital experience. In a way that I have never before felt from a piece of software, the game plunged me into sustained meditations on the permeability between the real world and the online one — and it offered me some hope of a more realistic kind of online life in the future”. Read more - NYT.
7. AirAsia and Trip.com partnership
The partnership is part of the low cost airline’s ongoing strategy to transform from an airline into a travel, lifestyle and financial technology platform. This partnership gives AirAsia consumers the ability to book hotels, activities and insurance on all of AirAsia’s digital assets. Since last November, AirAsia has been selling flights on more than 100 other global airlines in a deal with Prague-based Kiwi.com. As part of the deal, Trip.com’s premium members will be getting “upgraded privileges” when they book AirAsia tickets. Read more - WiT.
8. $500M fund launched to acquire distressed hotels and rebrand them as Hilton
Miami-based private equity firm CGI Merchant Group is planning to launch a $500 million fund to invest in distressed and value-add hotels in North America and the Caribbean that would be branded as Hilton properties. According to CGI’s CEO, they would acquire about 20 properties in the next few years to take advantage of the buying opportunities the pandemic has created. “We’re very, very bullish on the long view of the hospitality sector. We think that values will be significantly depressed.” Read more - TheRealDeal
Two major Chinese hotel groups made a strategic investment in ExcelLand, a robotics mobile platform, following its $14 million Series B+ financing round. Its proprietary robots are already providing services in more than 200 cities. Read more - China Travel News.
Last Vegas-based Travelmate Robotics, founded in 2016, has developed autonomous suitcases controlled by a traveler’s smartphone. The bag has wheels that allow it to travel upright and on its side and uses ultrasonic sensors to avoid objects.
Misapplied Sciences has developed “Parallel Reality” technology that allows airport flight boards to display different, personalized travel information for up to 100 people at once. Individuals would look at the same screen but see details about their own departure times and gate numbers, as well as customized images and videos.
U.K.-based Aurrigo developed GPS and Lidar technology that turns existing baggage dollies into autonomous, self-navigating vehicles that can carry luggage and cargo around the airport. They were tested last year at London’s Heathrow Airport.
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