Travel Tech Essentialist #47: Time Well Spent

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In this newsletter, you can see that there has been a flurry of M&A and funding activity in business travel in recent days, reflecting the tectonic shifts taking place in the space. Brian Chesky comments on the shifts taking place in leisure travel as well (#5). Travel companies are also having to adapt to new consumer behaviors that will be here for the long term, some of which are highlighted by Euromonitor (#4). Most importantly, Tim Urban (in #1) makes us reflect on the importance of time well spent. And in this, the travel sector plays a vital societal role.


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1. Time well spent

Time feels abstract sometimes. In The Tail End, Tim Urban crystalizes our need to reassess how we spend the remaining time we have left and provides some powerful examples in graphical form. This is what he says about the in-person time remaining with his parents: "It turns out that when I graduated from high school, I had already used up 93% of my in-person parent time. I’m now enjoying the last 5% of that time. We’re in the tail end”. His post made me think about travel. Travel consistently occupies the top spots of the most valued experiences and what we most look forward to. If a 40 year-old person who lives to 90 years old takes 1 trip a year, that person has 50 trips left in his lifetime. Even a 25 year-old who travels 5 times a year should choose her remaining 325 trips wisely. I, for one, am very thankful for what you all are tirelessly working on: making a better travel experience for consumers.

2. Vaccination race

Almost 50% of Israel’s population has now been vaccinated. Vaccinations in Israel, UAE, UK and the US have doubled in the last 2 weeks. Meanwhile, the frantic activity that the European Union shows in coming up with new regulations and fines does not extend to their vaccination campaign. Maybe the two are related.

3. Daily cases per million people in the top 10 most visited countries

Here is how the top 10 most visited countries in the world (2019 data from the WTO) are doing in terms of rolling 7 day average daily confirmed Covid cases per million people. UK and the US have been headed in the right direction for the last two weeks while Spain is in a tougher spot. It has the highest daily cases per million and the curve has been heading up non stop since the beginning of 2021. France has made encouraging progress from its November highs. It should also be noted that, because of limited testing and inconsistent accounting across countries, the number of confirmed cases is lower than the number of actual cases.

4. Top 10 Global Consumer Trends for 2021

Euromonitor, a global market-research firm based in London, has released its forecasts since 2010. Their 10 Global Consumer Trends 2021 include:

  • Craving convenience - Always available, pre-planned experiences

  • Open air for work, events and recreation.

  • Phygital reality (physical + digital), a hybrid where consumers seamlessly live, work, shop and play both in person and online

  • New schedules will demand a 24-hour service culture

  • Safety is the new wellness movement

Each of the 10 trends in their report follows the same format: Overview and defining characteristics; Consumer behavior and motivation; Business environment and impact; Outlook and strategic recommendations.

5. Airbnb’s Brian Chesky sees some permanent shifts in travel

At the Reuters Next virtual event last week, Brian Chesky laid out four main permanent shifts in travel, which all seem to be in Airbnb’s favor. And judging from Airbnb’s stock (50% since its IPO, with a market cap of $129 billion), investors seem to agree.

  • More leisure travel as consumers, stuck in their homes for so long, yearn to get out.

  • A new type of business travel will emerge. He calls it a "hub and spoke model", where people work remotely but every quarter they go back to their HQ for a couple of weeks.

  • From cities to everywhere. Instead of people traveling only to the top 50 cities in the world, crowding hotel districts and going to see the same landmarks, they are now going to travel to smaller cities and rural areas.

  • From mass travel to meaningful travel: “Travelers are not yearning to see Times Square. They want what was taken away from them; to see their friends and their families they have not seen in a long time.”

6. AirAsia continues its push to become the “OTA challenger” in Asia Pacific

The airline wants 50% of revenue to be from non-AirAsia flights by the end of 2024. In the last few months, AirAsia has added additional travel services, such as flights from other carriers, airport transport, hotels and activities, with partnerships with the likes of Kiwi.com, Turkish Airlines, Agoda, Trip.com, and is in “serious discussions” with other full-service carriers, including European airlines, and potential GDS partners. And their plan is to not compete on Google and Facebook for customer acquisition. Instead, AirAsia is looking to mobilize its 75 million customer base. Read + Phocuswire.

7. Singapore Airlines takes the lead

Singapore Airlines could become the first vaccinated international airline of the world, as an exercise gets under way to vaccinate some 37,000 aviation and maritime front-line workers against Covid.

8. Permanent changes in business travel

Back in November, Bill Gates predicted that over 50% of business travel will go away permanently now that remote work and virtual meetings have become the norm. In Why Bill Gates is wrong and business travel won’t die in 2021, the founder of Topia points out 3 key factors that Bill might have underestimated, and offers some advice for companies to prepare for the changes in business travel. In Travel Has Peaked, Here's Our Future, the founder of tClara points to why business travel will be permanently smaller. He also offers 10 implications on the future of managed travel. Despite the divergent titles of these articles, the underlying conclusions are not that far apart.

9. Funding

  • Klook, the Hong Kong-based travel activities platform backed by SoftBank, raised $200 million in a Series E round, bringing the total capital raised to $720 million. Founded in 2014, Klook exceeded $1 billion in valuation in 2018 but declined to reveal its latest post-money valuation.

  • TripActions raised $155 million to help enterprises analyze travel and expense data.  The series E round was led by existing investor Andreessen Horowitz and values the company at $5 billion, up from the $4 billion valuation at its series D round 18 months ago.

  • Travel map app Maps.Me raised $50 million to launch a multi-currency wallet on Maps.me and enable a decentralized finance (DeFi) ecosystem on the platform. The Zurich-based app offers offline access to turn-by-turn routing, travel guides, hotel bookings and maps which is targeted toward travelers without cell phone reception or pre-paid phone plans.

  • Madrid-based Meep closed €4 million to expand its mobility app to the US, Latin America and across Europe. Through Meep, users can see, book and pay all available route options and modes of transportation within a city.

  • Business travel platform Pana raised $3.5 million, bringing its total funding to date to $15 million.  The company started out in 2014 as an on-demand travel concierge and has since pivoted to serving travel managers.

  • London-based co-living renting startup Gravity raised $1.4 million to expand its model internationally.

10. M&A and Partnerships

  • American Express Global Business Travel acquired Ovation Travel Group, a U.S.-based global company founded in 1984, with more than $1.7 billion in annual sales.

  • ATPCO is expanding its product portfolio with the purchase of Airfare Insight, SITA’s fare management system.

  • Hopper announced an NDC partnership with Lufthansa Group, offering its clients access to the airlines’ branded fares, bundles and ancillary product offerings.


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Thanks for your attention and stay safe,

Mauricio


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