Today at its annual conference, the International Air Transport Association (IATA) said it was creating a stand-alone venture capital fund, the NDC Innovation Fund.
The fund is jointly run by Travel Capitalist Ventures, a private equity and venture capital firm specializing in travel industry investments, such as in the startup Guiddoo, which makes mobile audio visual guides.
It's not just an airline-focused fund. Instead, the fund claims to support companies working on the distribution of hotel, rental car, cruise, and tours-and-activities products, too.
The fund plans to invest in small- and medium-sized companies, such as travel content, travel e-commerce sites, travel hubs, travel technology companies, travel apps, and software as a service firms, working on technical solutions that use IATA's New Distribution Capability (NDC) standard.
The fund is investing at an early stage, with $500,000 to $1M capital investments. It invests in exchange for equity and for revenue share arrangements.
The fund portfolio is expected to be about 20% pre-product seed stage investments to 80% post-product seed or Series A.
In a speech, IATA president Tony Tyler said today that the fund's aim is
"to support financially and strategically-positioned companies willing to develop applications and solutions to leverage the many capabilities the NDC standard enables."
NDC is a travel industry-supported program launched by IATA for the development and market adoption of a new XML-based data transmission standard.
Abrar Ahmad, a partner at Travel Capitalist, said in a statement that the fund is soliciting proposals from companies seeking the capital and business development support needed to develop applications and services to meet current and future industry distribution needs.
Mentoring is part of the goal. Fund investments advisors can test a company's assumptions and vet its product offering and make formal introductions to "marquee clients and suppliers."
Resources are also offered, including free cloud infrastructure solutions (through Microsoft BizSpark) for virtual servers, media streaming, CDN's, queues, and high capacity database options.
The fund estimates that the verification process will take two to three months before candidates are accepted. (There's more on the fund's website.)