Scott Case, Upside
"Uncertainty about when and if business travel will return to pre-pandemic levels has made raising additional capital or finding an alternative path too unlikely."
Quote from Scott Case, CEO of Upside, in an article on PhocusWire this week on the demise of the travel startup.
Each Friday, PhocusWire dissects and debates an industry trend or new development covered by PhocusWire that week.
The challenges for travel startups were immense before the pandemic and have, inevitably, only increased.
With survival as the main challenge in the past 18 months, many startups retrenched, stripped out all unnecessary cost and focused on product.
Few pivots happened simply because no one knew what the outcomes might be six to 12 months down the road. In many ways, we still don’t.
As the industry begins to see some shoots of recovery, the focus for travel companies of all shapes and sizes is moving forward in the most efficient way possible.
For good or bad, that’s likely to mean a sharp focus on business that is coming in now and systems and tech that can address huge inefficiencies.
Technology for perceived smaller fixes is unlikely to be a priority for some time.
There are significant funding deals being done, such as in business travel and aviation, where have been very low volumes for a prolonged period.
But the investment appetite often seems to be for challenges that existed before the pandemic and have been exacerbated by it.
Corporate travel is one example with those attracting investment trying to address the bigger challenge of greater all round efficiency through automation.
Even if business travel doesn’t come back to the same levels as the pre-pandemic years, there will still be employees on the move, just with an even greater scrutiny on cost, productivity and efficiency.
The smart money currently seems to be going towards technology that drives this efficiency and/or where the next area of disruption for travel might come.
It’s interesting to observe large investment rounds going into the mobility, alternative accommodation and other segments.
But what’s perhaps more noteworthy is that M&A activity is taking place - a good signal to where different segments of travel are placing their bets and thinking about the future.
PhocusWire's editorials examine a trend or development highlighted in an article during the week.