Bobby
Healy has built several travel technology companies and is also a
keen observer of developments in the travel distribution landscape.
The
co-founder of car rental distribution specialist Meili has always expressed his
opinions openly about dominant players in the market such as Google and the changing
landscape for travel suppliers and intermediaries.
During
an interview at a recent Travel Massive event, Healy discussed hard challenges, the travel
technology opportunity and the travel business he would build now if he had “another
life.” The session was moderated by James Lemon, global industry lead of hospitality,
travel and leisure at payments company Stripe.
The discussion has been edited for clarity and brevity.
Early on in the conversation, Healy,
who is also the founder and CEO of drone delivery company Manna, touched on difficult
problems to solve, such as food delivery by drone, describing it as the “hardest
mode.” And while solving it could mean big business, he would not advise other
founders to pick the hardest problems.
“I'm
not intentionally looking for a hard mode. But what attracted me to this is
that it's very interesting, obviously, the size of it, it's probably a trillion-dollar
untapped business."
“My
advice would generally [be] to build something that you're able to build, and build something
that is not necessarily a moon shot. It’s going to be a decade of your life.
Some of us have been taking longer than that. My last one was 15 years; this
one will probably be 20, but what I was motivated by this time was the scale of
the prize.”
Founders
and quick exits
While
Healy feels five years might be a bit ambitious to build a business and sell it,
he does believe there is “easy money” to be made in travel technology.
“That
does happen, but it's unusual. I would kind of round it off. It's probably a
decade to ripen a bit of fruit properly, not to full maturity. It's
in a kind of compromise between taking if off the table too early and just
going the full extent of the journey.You should be planning on a decade for sure, and you should be planning the first five years of barely any pay for
yourself."
"And, in general, nearly 90% of us, of startups, will fail and will
take a long time realizing it. So, you have to be certain you can survive that, and it's not something that hits your confidence or makes you not enjoy those
five years. At the end, it's just a project; it's nothing to be precious about.
It's just a project from start to finish. But I wouldn’t be thinking five years,
that's for sure.”
Fixing
travel distribution
The
travel technology industry can be slow to change, hence why the same themes come
up time and time again, but Lemon questioned whether it should be so hard.
What I like about the industry is there's a big pig of technology underneath, which just makes it really hard for big companies to do anything.
Bobby Healy, Meili and Manna
“I've
always loved travel industry. I’ve been in it since 1990 building companies,
and the technology has always evolved, but the ecosystem has never changed,”
Healy said. “It's hotels, cars, GDSs, whatever. What I like about the industry
is there's a big pig of technology underneath, which just makes it really hard
for big companies to do anything. I think that's great.”
He
added that if you’re an industry insider it’s easier to progress because everybody knows
everybody, but it is harder for external companies to break through, citing Duffel as a good
example.
“It
has a ton of backing, it’s backed by Benchmark, a prominent tier one U.S.
investor, and a great product team, but it has taken on a big challenge—fixing flight
search. There's a big mountain to move if you want to get flight search working,
just ask Google. So, I think it's an industry where being an insider and knowing
the history of the industry, knowing the appetite of the big
players and their willingness to change and move off what they're used to,
helps you set the needle and how ambitious of a change your product
is going to drive.”
Healy
said integrating payments through a company such as Stripe is “a no brainer,”
but building technology to improve hotel or flight search, “you do have to move
mountains.”
AI in 2040
There
is significant hype around artificial intelligence (AI) in travel, especially around agentic AI and booking, but Healy said people forget the industry “changes in units of 50 years, not in
units of five years.”
“We're
still on GDSs. I mean, it's like virtualized TPF [transaction processing
facility], but it's still impossible to move. Inventory pricing, published rates,
all that stuff that revenue management systems sit on top of, all the hierarchy
of technology that all has to move in concert or nothing changes. So therefore,
if you're building a product, you build lipstick, you don't build motors. That's
the way I always sell it if you want to make easy money. If you want to make
hard money, you build Duffel, or you build something that really does challenge
the status quo.”
Many
travel companies are considering how conversational search and surfacing of
real-time availability by AI platforms will change how consumers book travel.
Lemon asked whether the travel search box might be dead.
Healy
said that what Booking.com and Expedia have achieved in terms of aggregation and
providing value to consumers and suppliers could be repeated but “without a web
browser,” adding that it is what he would be building if he had “another life.”
If you want to make hard money, you build Duffel, or you build something that really does challenge the status quo.
Bobby Healy, Meili and Manna
Lemon also asked whether the industry should just use AI to improve back-office processes or create a curated travel
marketplace for consumers.
“I
wouldn't start there because I think it's hard to pick what the winning mode
would be. There are going to be so many because there is a low barrier to
entry there. I don't know the answers to what's the best way to interact. I have
ideas, everybody has ideas, and it's very personal thing because if you think about
how you want to book travel or how your wife or your husband or whatever [would book travel],
you'll get a different answer from everybody. So, I wouldn't get into that
space because it's a low barrier to entry. There's going to be so many players
there.
“And
then you also have a distribution problem as well, because you're producing
something for consumers and you have no distribution. And then you’re just
competing with giants.”
Healy
is more interested in the opportunity around some sort of real-time model—powered
by AI, potentially for hotels—that could disrupt Booking.com.
“Hotels is the best example where you’ve got a million properties or more and you have, not the structured data and that stuff we’re used to, [but you have to] select the property from 250 properties in Amsterdam, [with] more than one human deciding, the family, the friends or whatever. Rendering that in a box [would] allow everybody to compete with Booking.com
“So,
every small agent, big agent, airline, whatever it is, has access that to this
incredible repository with just the world's properties. And, what's the pool
like? Is it a nice pool? Is it a nice gym? AI can look at pictures; [it] can
understand stuff. That is what I would like to build because that replaces Booking.com’s
value and Expedia’s to slightly lesser extent.”
He
suggested much of the work done by online travel agencies across contracting
and onboarding, pricing and search engine optimization will all be “meaningless”
in 20 years.
“Any
tech person in this audience knows that now can be automated with agents. Agents
can look for content, they can sign up the content, they can call the
properties, they can do all that stuff in an automated, scalable way for no
cost.”
Car
rental and more for Meili?
Meili,
according to Healy, is version two of CarTrawler, a business he also helped
build. While CarTrawler provided an aggregation layer for airlines as well as a
ready-made retail product, the cost base was high and there were challenges in
trying to keep airlines, car rental suppliers and consumers happy.
The second
time around, the ambition is to grow rapidly and offer more than car rental, with a
new product to be announced soon alongside customers for that product.
“It's
not just about car, but car happens to be at the top of the pile. It’s the
easiest to do, it's easiest to sell, it's got a great margin on it. If you
think about our business, it's all about airlines and big travel companies that
we want to make it easy for, just like Stripe does.”