Jason Morehouse, CEO and co-founder
Since launching in June, 2010, Checkfront has grown from a humble operation in Victoria, British Columbia, Canada, to a business that processes over $1 billion in bookings annually, made by tour and activity operators in 112 countries around the world.
Prior to creating Checkfront with Grant Jurgeneit, Morehouse worked for a variety of businesses in Canada and New Zealand. He became CEO in 2015 after four years as its chief technology officer.
2018 was arguably the biggest year in the history of tours and activities. As a company that has been in the sector over eight years, what are your general observations on what happened?
It was definitely a big year. The two acquisitions of reservation systems by Booking.com and TripAdvisor raised some eyebrows, especially related to the stated reasoning around why the moves were made.
Ultimately, those moves are good for the space and haven’t had any negative impact on our business — in fact, it’s been positive.
Having been a part of this sector for almost a decade, it feels about time that tours and activities has come to the forefront of this industry.
It’s exciting to be a part of it and see improved focus across the board. From our perspective, it has always been about delivering value to the suppliers, and ensuring travellers have great experiences with our customers — that’s what we’re focused on.
Much attention has been given to the moves last year by the big consumer-facing intermediaries. With a few months behind them, what are your supplier customers saying about those developments?
There’s a lot of uncertainty around what it means — particularly, what happens to their data?
Will the OTAs lock up their supply, and what happens to the other channels they’re selling through?
OTAs are an important mix of a supplier’s channel sales, and we hear the concerns related to suppliers controlling their inventory and data.
The OTAs are absolutely needed in the space. They provide enormous value in terms of driving consumer traffic and sales.
And they deserve some commission on those sales. But to put the reservation technology and the actual products and inventory within their control makes many suppliers uncomfortable.
If you could look ahead to what happens next in that particular debate, what would say the sector should be looking for next and what should they be wary of?
Innovation. Checkfront, and reservation systems in general, should be focused on how we can help suppliers provide the best experience possible — from discovery all the way to delivery.
In our view, it’s short-sighted to focus so much on OTAs because it’s only one of many ways that consumers will discover and purchase products.
We want to ensure our suppliers understand the best ways to promote and facilitate the discovery of their products, the best sales channels for certain types of products, at what times and to what travellers.
If that means a certain percentage should go through a particular OTA versus another OTA, then great.
Shifting emphasis now - what technical challenges does the sector still face and what should be done about it, either by companies such as Checkfront and the sector as a whole?
There’s still a massive technical challenge around data standards in terms of how products and inventory are managed and sold.
There are many reservation systems, each with different standards for how product data is structured, and the OTAs have different ways of doing things and different data standards as well.
Startups are basically a series of mistakes strung together. Some can be fatal, while others are a learning experience.
Jason Morehouse - Checkfront
Standardization just doesn’t exist yet in activities, and that’s a huge challenge, especially considering the complexity of the activities segment — there are literally hundreds of subcategories, and each has a unique way in which their products are configured and sold.
Another challenge is around how we can effectively onboard these customers into the product and get them to understand the value of this technology.
There’s still a ton of tour and activity businesses out there not using modern technology. Oftentimes, it’s because they’re set in their ways, or they just don’t have the time to properly go through the process of setting up their inventory, their products, channels, etc.
So how do we collectively come together to help drive home the value of the solutions we provide to make their lives easier?
One particular issue that often comes up is the lack of standards in tours and activities (compared to, say, aviation and hospitality). Is that something the sector should address or is too much of a "Wild West" out there to coordinate anything meaningful?
It’s definitely “Wild West”. Everybody is kind of doing it differently. We’ve been part of a couple of new consortiums to come together in the sector and have discussions about the best path forward.
I don’t think it’s necessarily a situation in which all suppliers are going to get together. For example, in the aviation industry, the big carriers came together to focus on building up a Global Distribution System.
You’re probably not going to get that in the tours and activities sector simply because the suppliers are largely very small businesses.
Collectively they have a voice, but on the whole, there aren’t big suppliers that are going to drive those initiatives forward.
So it’s going to come down to either businesses like Checkfront or others in the industry to work together and develop some standards that we can all support moving forward.
2018 also saw a considerable effort by Google to enter the space (such as the Touring Bird platform). You have a partnership for Reserve With Google but what is your take on its model and approach?
I think it was inevitable that Google would enter the space. I mean, they’re the largest for search traffic on the web.
And oftentimes, that’s where people start their search for travel products, destinations, vacations, etc.
To put reservation technology and the actual products and inventory within OTA control makes many suppliers uncomfortable.
Jason Morehouse - Checkfront
We are committed to providing suppliers access to the best channels for their business, and that includes any channel that makes it easier for travellers to discover and book experiences.
In addition to massive benefits through Google’s search platform, I think currently one of the biggest value drivers for our customers is that it’s commission-free.
Of course, that’s Google’s current model, which might change in the future, but the fact our customers have another channel to sell through with zero commissions is huge.
Following on from that, some consider Google's entry to be a massive boost for suppliers and a worrying sign for OTAs. Do you agree?
I wouldn’t call it a worrying sign for OTAs, but they are going to be paying very close attention to what Google is doing. And these OTAs are spending a ton of money in advertising on Google. So there’s definitely some friction there.
But the large OTAs are already so embedded and entrenched. They’ve built their brands in the travel market, and that’s still where a lot of the consumers will go regardless of Google’s entry into the space.
If you could expedite a technical process above all others for the benefit of the sector, what would it be?
The process of data standardization. It would make everybody’s lives much easier if we had a set of data standards we could adopt to remove as much friction as possible across all channels suppliers may be selling through.
What assumption about your customers and travellers did you have that you since found out not to be true?
Specific to Checkfront, we were somewhat naive early on as to the requirements of our customers. The complexities of many of these businesses, big and small, can be mind-bending.
Our Technical Support and Customer Success teams had to be incredible problem solvers, and our product needed to match those requirements.
That took years to get right, and we’re still going at it.
Can you identify a mistake you witness others in the sector making more than any other?
Startups are basically a series of mistakes strung together. Some can be fatal, while others are a learning experience.
We’ve been lucky, but certainly had our fair share of fumbles.
There’s still a lot of trial and error happening in the space, and that’s good — that’s innovation. Yet, we’ve seen large overcapitalized companies fail.
I think the one thing we’ve stayed true to is being incredibly supplier focused. It’s not a space you can easily buy your way into.
What would you say has been your proudest achievement in business so far?
As a founder, I’ve been able to watch the evolution of our company from day one.
Going from a couple of people working in a half-finished basement to 70 employees and close to 5,000 paid customers in 130 countries still feels a bit unreal.
The fact we’ve been able to reach that scale with no venture funding puts us in a unique position.
Finally, seeing smarter people join the company and take your initial idea and make it so much better is an undeniably great feeling.
And finally, tell us something that you like and dislike about being a CEO?
That’s a harder question to answer than it should be.
It’s a huge responsibility, and you don’t always get it right. But for me, it’s been such a great experience and challenge.
I think it’s made me a more grateful and humble person, and that really comes down to working with such a great team with an amazing mission.
For dislikes, there’s a lot less instant gratification now than when I was wearing 5 different hats... but I also don’t necessarily miss those days.
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