TLabs Showcase - Pocketvillage

TLabs Showcase on travel startups featuring Germany-based tours and activities metasearch engine Pocketvillage.

Who and what are you (including personnel and backgrounds)?

Pocketvillage is a metasearch engine which aggregates a wide choice of extraordinary travel activities, tours, and places to stay – and makes it easy for consumers to find the ones that best match individual interests.

The website officially launched in March 2011 at ITB Berlin.

Our team is a diverse mix of travel addicts, technology geeks, and social media enthusiasts. The five co-founders have been working (and travelling) together for many years on various projects and make a strong and well-proven team.

Florian Harkort, CEO / Business, formerly with Ernst & Young, AIESEC Germany and German Technical Cooperation, is responsible for partnerships.
Martin Hümmer, CEO / Product, studied Aerospace Technology, and is responsible for front-end coding and web design (an obvious fit!).
Jann Kleen, CTO, studied Cybernetics and Computer Sciences, worked for the High Performance Computing Centre Stuttgart, and is responsible for the magic in the black box.
Matthias Scheffelmeier, CCO, project coordinator with Microsoft Middle East & Africa, AIESEC and ASHOKA, is responsible for external communication.
Stefan Pfeuffer, HR & Legal, studied German & European Law, worked for AIESEC and a law firm in Serbia, is responsible for talent management and the small print.

The team is based in Stuttgart and Berlin, Germany. We’re supported by five employees from four countries and a community of more than 1,300 fans on Facebook.

What financial support did you have to launch the business?

Initial funding from the founders, followed by a seed angel round by a private investor from Germany.

What problem are you trying to solve?

More and more people are looking for extraordinary travel experiences away from the mainstream tourist attractions. The problem they face is obvious: It is (still!) very difficult, time-consuming, and dizzyingly complex to research and book unique in-destination activities and tours on the internet. Those offers are scattered across the web and world.

A recent PhoCusWright study discovered that 60% of activities and tours in the US are still sold offline in the destination, 28% are sold through operators’ own websites, and less than 2% (!) are distributed via online intermediaries.

The study concludes: "The in-destination activities landscape is incredibly fragmented, comprised largely of small, local providers."

Describe the business, core products and services?

Our vision is to enable the most extraordinary travel experiences for everyone.

Pocketvillage is a metasearch engine that aggregates a wide choice of hand-selected extraordinary activities, tours, and places to stay. Its intuitive "Inspire Me" process makes it easy for you to find the offers that best match your individual interests

a) Metasearch engine: Through our partnerships with dozens of niche market leaders and specialist vendors we’re aggregating a combined inventory of 30,000+ activities and tours from 3,500+ local operators (de-duplicated). Most offers are conveniently bookable online.
b) Selection & curation: Through a multi-step process we hand-selected and rated 5,500 extraordinary activities and tours and 5,500 unique accommodations, enabling 100% adventurous, cultural, eco, responsible, or off-the-beaten-track experiences. The user can choose and combine a variety of 60+ themes and categories. An algorithm will ensure that the most relevant and extraordinary offers are displayed on top.
c) "Inspire Me" process: The in-house team developed "Inspire Me" process lets you browse and filter intuitively through the thousands of offers and makes it easy to find the ones that best match what you're looking for. The user can playfully draw the landscape of his dreams or pack a virtual suitcase with the things he is interested in. As our database is fully indexed, the system will then come up with a list of offers, which match the selected criteria.

Who are your key customers and users at launch?

Key customers are grown-up backpackers, jobholders and families who have less time than they used to, have an increased demand for pre-arrangements but actively want to experience unique holidays and exciting new destinations.

Social media marketing is part of our DNA. Our products – extraordinary activities, tours, and places to stay – are the reason why people travel and chose a destination in the first place. This makes our service a highly emotional one and perfect for word of mouth marketing.

Did you have customers validate your idea before investors?

The idea of Pocketvillage was born out of a self-experiment in 2009, when Martin and Florian travelled from Addis Ababa to Cape Town with public transport and a tent. On our way we were talking to many fellow travellers and discovered a huge market gap.

Back home, we developed the concept in an iterative process and in close collaboration with our friends and community of now well over 1,300 fans on Facebook.

What is the business AND revenue model, strategy for profitability?

As a metasearch engine we are earning money by referring users/customers to our partners’ websites.

We are mainly working with a revenue sharing model, which is usually 8-15% for activities and 5-10% for multi-day tours and accommodation. With some partners we are working on a pay per lead or pay per click basis.

SWOT analysis – strengths, weaknesses, opportunities and threats?

Strengths:

Highly motivated and strong team, covering all the relevant aspects.
Enthusiastic community, constantly providing us with valuable feedback.
A very wide selection of travel operators and outstanding partners who we are very proud to work with.
Fully implemented partners include: Urban Adventures, Viator and GetYourGuide for activities; Intrepid, Gap Adventures, responsibletravel, TourCMS, Tripbod for for multi-day tours; and Airbnb for places to stay.
In progress are: WHL.travel, Escapio, Isango, Rezgo, Much Better Adventures, Gunyah, Expedia Activities, GTA/OctopusTravel, CityDiscovery, Kijubi, Kumutu, rent-a-guide, and many more…
The activities and tours sector lacks common data formats and standards. Aggregating, analyzing, categorizing, and constantly updating the content from so many and completely different XML feeds, APIs, and CSV files is an incredibly time-consuming task. Having developed systems to automate many of the involved steps is one of our strongest competitive advantages.

Weaknesses:

We are quite new to the travel industry, hence are coming at this from a consumer perspective rather than thinking of it like a big game of chess.

Opportunities:

There is a growing market need for extraordinary travel experiences. More and more people want to have the “trip of their lifetime” every time they travel.
A study by the Adventure Travel Trade Association showed that 16% of all international departures from the Americas and Europe are for adventure travel.
The market for in-destination activities and tours is "fantastically fragmented" and surprisingly large, accounting for $26.8 billion in the US alone (study by PhoCusWright). Sales via online intermediaries are projected to double by 2012.
There are endless opportunities to improve our recommendation algorithms by processing even more tour and context data.

Threats:

We are just a small German startup!

Who advised you your idea isn't going to be successful and why didn't you listen to them?

We spent months discussing our idea with banks and public funding institutions in Germany. This was a very frustrating process and people were quite unhelpful and sceptic. It is really difficult to grow an internet startup in this country, which is a pity.

As we continued to firmly believe in pocketvillage we all threw in our private savings, started to build the product on our own, and then raised some funding. The successful launch at ITB now proves us right.

What is your success metric 12 months from now?

Enabling 5,000 extraordinary travel experiences every month.