Peer-to-peer marketplaces have swept in to destination tours and apartment rentals, but FlightFox also reckons consumers could help one another secure flights.
This is idea behind the US and Australia-based platform which launched in February 2012.
The business is fronted by Todd Sullivan and Lauren McLeod (former owners of GlobeTrooper - TLabs and Reprise] and is in the latest batch of Y Combinator startups, having raised $800,000 from private investors in both Australia and the US.
The team of six built a service which essentially allows users to post details of a required trip, then so-called "flight hackers" from around the world go off and compete for the best flights.
"We affectionately call them hackers, but really they’re anyone obsessed with flying, including licenced travel agents," says Sullivan.
The service is not targeting short-hop, low cost carrier users, preferring consumers looking for long-haul, multi-city and complicated routes.
Of course, such a platform puts FlightFox up against existing online travel agencies, but the company reckons an estimated $10 billion market can be broken into.
Hackers share 25% of their finder's fee to FlightFox, revenue which it says is currently being reinvested to improve the platform.
Q&A with co-founder Todd Sullivan:
How is the way you are solving this problem more special or effective than previous attempts you or the market has seen before and how different do you have to be to succeed?
Most innovation in flight search involves “doing it yourself”. But in many cases, flight search is much too complicated to be solved by simple algorithms.
So unlike competitors, we’re solving the problem by putting flight search back into the hands of experts. In any other industry, offloading an arduous task to experts isn’t revolutionary, but with flights, there’s certainly aversion to scaling with humans.
Why does this matter? Because unlike other websites, we handle every airline, every route, every frequent flyer program, every flyer (including pets), the list goes on. We cover every option and can handle any request.
In addition to being human powered, Flightfox is crowdsourced. If there’s a better flight to be found anywhere, our experts will suggest it because that’s how they win your finder’s fee.
Suddenly, your interests and our experts’ interests are completely aligned.
As long as we keep these interests aligned and consistently deliver value above simple algorithms, we’ll give the OTAs a good run for their money.
Why should people or companies use your startup?
You should use Flightfox if you think there’s any chance an expert can find you a materially better or cheaper flight. If you are unsure, just give us a try.
Our finder’s fees start at $24 (one-way international), so compared to an average fare of $1,000, it’s very little. At worse you lose $24, but more likely you’ll save time, money and learn a thing or two about how our experts find the best flights.
You shouldn’t use Flightfox for simple domestic routes or for routes you know very well. We can help most with complex and flexible trips.
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?
Our strategy is to keep improving until our growth accelerates through word-of-mouth. Intuitively, if our product isn’t growing through word-of-mouth, then it needs work. And while it needs work, we probably shouldn’t waste time with marketing.
Maybe naively, we think raising awareness is the easy part. It’s creating a product that’s worthy of awareness that’s challenging.
What other options have you considered for the business and the team if the original vision fails?
We are 100% focused on crowdsourced flight search for the foreseeable future. There’s something to be said for contingency plans, but that’s not our culture.
What mistakes have you made in the past in business and how have you learned from them?
I suspect anything we’ve learnt from the past will, in time, prove also to be erroneous. Right now, (we think) we’ve learnt most from launching quickly, charging early, talking with customers, and iterating quickly.
Success seems to come from experiments, and for the most part, experiments are a numbers game.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
I’ve never met a startup founder whose intentions were to "help out". Instead, like most, we have set out to fix a diabolical mess. We’re big travellers, we’ve lived on six continents, we’ve taken hundreds of flights.
We know flight search is fundamentally broken. Ultimately, we want to mobilize the masses; we want more people to explore this crazy world. We think we can do this by giving the average person access to expert skill and local knowledge.
This may sound somewhat lofty, but AirBnb is a recent case in point. The tourism industry was certainly labelled mature when they started, but look at what they’ve achieved. We spent most of the past two years living with various AirBnb hosts.
If its success is a measure of what’s wrong with travel, then there’s plenty of opportunity for new travel startups.
Tnooz view:
So, P2P has clearly worked for the likes of Airbnb, but this is an entirely different proposition, where consumers act as agents rather than suppliers or owners of product.
Agent-type marketplaces have existed before, but regular complaints from both sides have focused on the effort required to help with no guarantee of a return and the time consumers might have to wait for a result.
But perhaps this is where FlightFox is hoping it can be different, by focusing on the so-called big-ticket items of long-haul and multi-stop trips - an area which often leaves consumers in the dark and confused, and where agents often excel.
With some money from investors in the bank and presumably some also already coming in from hacker commissions, it will be interesting to see how FlightFox attempts to scale the product, not least because (as mentioned above) it is relying on word-of-mouth rather than spending its way into oblivion.
It is also slightly unclear as to how many hackers will be required to give the quality, coverage and variety required by consumers.
Word-of-mouth, of course, will only prove its worth if the results from the hackers are better than what can be found elsewhere on the web (albeit time-consuming for consumers) or with an agent on the end of a phone call.
Snap poll:
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NB: TLabs Showcase is part of the wider TLabs project from Tnooz.