TLabs Showcase on travel startups featuring US-based luxury vacation rental and trip management service Inspirato.
Who and what are you (including personnel and backgrounds)?
I am the founder and CEO of Inspirato, Brent Handler. Before creating Inspirato, I served as the president of Exclusive Resorts, the company I co-founded with my brother in 2002.
The other founders of Inspirato are: my brother Brad, whose background includes stints at eBay and Apple prior to Exclusive Resorts; COO Martin Pucher, who was a founder of DMX Music and an executive at Liberty Media Corp. and Tii Network Technologies; chief experience officer Brian Corbett, a Harvard MBA who was with us at Exclusive Resorts, where he launched and managed the company’s Once in a Lifetime experiential travel program.
What financial support did you have to launch the business?
We raised $5 million in startup capital from individual investors.
What problem are you trying to solve?
The vacation rental industry is a highly inefficient business and too often creates a frustrating or disappointing experience for the consumer.
Renting a home online is a lot of work: finding the right home for your needs, negotiating with brokers for the best deal you can find, hoping that what was offered online matches the reality.
Plus, most vacation rentals don’t offer any amount of service before or during your trip to assist with planning and take care of any needs that come up.
The luxury segment is particularly underserved with current offerings, so we see tremendous opportunity to provide the flexibility and pay-as-you-go structure of vacation rentals AND the services and amenities of the highest-end private clubs, but without the long-term commitment, six-figure upfront fees, or restrictive reservation policies those clubs entail.
Private fractional clubs and destination clubs, such as Exclusive Resorts, which I co-founded with my brother in 2002, serve a very small segment, the ultra-rich, due to their high initiation fees and annual dues structure, so the model we have created takes that same experience but applies it to a much larger group of people, what we call the "everyday affluent".
Describe the business, core products and services?
Inspirato curates exceptional vacations for our members by selecting the very best vacation homes in sought-after destinations and controlling them through long-term leases, typically for three-to-five year periods.
This strategy allows us to provide a consistent, hassle-free, branded experience on every trip. We also provide our members with proactive, dedicated vacation planning services from a Personal Vacation Advisor and take care of members’ needs on-site through a Destination Concierge team.
Inspirato is not a deeded investment that must be sold upon exit, nor does it require hundreds of thousands of dollars upfront to join. Inspirato requires no long-term commitment, allows members to travel as much or as little as they wish each year, and does not require complex rules or trading to secure high-demand reservations.
Inspirato provides the best features of fractional clubs, such as service, amenities and resort access, without these drawbacks.
We currently have a portfolio of 45 luxury properties in 10 destinations available to our members. Each property is fully controlled and managed by Inspirato for our members; we do not broker other properties that we don’t control.
Who are your key customers and users at launch?
We launched on January 1, 2011 and began selling memberships that day. Our target audience is the "everyday affluent" consumer, who typically has annual income of approximately $200,000 and net worth of about $1 million.
We have sold more than 70 memberships in the last month, all through word-of-mouth referrals from other members.
Did you have customers validate your idea before investors?
We raised seed capital from individual investors based largely on the pedigree of our founders, who created the largest and most successful destination club, Exclusive Resorts, and had a proven track record (more than 100,000 vacations delivered) of being able to deliver the kind of service experience affluent travelers expect, along with a sustainable business model.
What is the business AND revenue model, strategy for profitability?
We earn revenue in three ways: initiation fees (introductory priced at $9,500), annual renewal fees ($2,500) and variable nightly rates. We have built a sustainable business model that requires very little capital upfront and is based on a great deal of knowledge of the market we are serving.
SWOT analysis - strengths, weaknesses, opportunities and threats?
- Booking is incredibly fast and easy with an online portal; members face no usage restrictions or booking complexities; the membership includes excellent service from personal vacation advisors and destination concierges. Plus, unlike other online home rental sites, Inspirato guarantees a consistent level of quality (linens, appliances, A/V, etc). The level of service and luxury is on par with the highest-end clubs that charge six-figure initiation fees and tens of thousands of dollars in annual dues. Inspirato has made this experience, previously available only to a select few, available to many more people at a value that can't be found anywhere else.
- We just launched in January so we have not yet built out our global footprint.
- The recent addition of Ideal, a weekly flash sale to members, taps into the hottest trend in travel. Luxury consumers clearly want a value-proposition, and other flash-sale sites can't guarantee the same level of savings, or the consistent and verified experience, that Ideal does because we alone are offering discounts on our own inventory, not brokered excess.
Who advised you your idea isn't going to be successful and why didn't you listen to them?
- We expect a lot of new competitors trying to copy the business model, but we stand out with our operational expertise, deep market knowledge, and history of providing tens of thousands of world-class vacation experiences.
Honestly we never heard that response from anyone! Everyone we spoke to about the business idea quickly got it. It was clear that there was a real opportunity for a more accessible club model, just as it was clear that the vacation rental industry was ripe for disruption. We fill that gap.
What is your success metric 12 months from now?
We expect to sell hundreds of memberships based on the successful delivery of our service model.
If we execute at the level we strive for on each and every vacation, our business will grow organically because of the value we so clearly provide to affluent families searching for a simple to use, flexible, affordable vacation option.
NB: TLabs Showcase is part of the wider TLabs project from Tnooz.