What the recent TripActions investment means for the rest of us in business travel

I was glad to see the news about TripActions recent raise. It is a sign of confidence for our battered industry. Although we have seen past signs of optimism (and capital) fueling innovations to digitize the industry and kick-start global mobility, there was something reassuring and comforting about new money being put specifically towards business travel.

Even if we don’t see 2019 figures again, investors know that business travel will come back. But one thing is clear – it will be different and they are betting on that.

The old model is changing. It’s no longer enough to be a travel company who embraces the use of technology. The industry is also consolidating as travel management companies take more ownership in technology and many travel tech companies invest in vertical integration (e.g., agency services, expense management, payments, meetings). 

Eventually, this will consolidate power amongst a few – creating new powerhouses in the industry. This shift is something that impacts us all. 

TMCs have a decision to make. They can invest, sell or wait. Who wouldn’t want to invest, right? Build or acquire new technologies to ensure that your company is well positioned for the future.

Except it’s perhaps the most challenging time to invest... ever - strapped for cash, resources and possibly facing the most daunting company transformation (what does it really mean to be a tech company?!), combined with uncertain timing of future demand. Sure, it can be done, but it’s not easy, and it’s risky!

The safer bet for many is to sell and we’re seeing that all around us. If you chose neither, by default, you’re waiting. Those who wait are armed with the knowledge that business travel will come back and that loyal clients will stick with them during this challenging time.

But if we’re coming back to a vastly different world, is waiting really an option, or is it simply delaying the inevitable? How long will those loyal clients be around once travel does return? Technology innovations continue during this time, and customer expectations increase, even in the face of unprecedented complexity. When travel does return, growth leaders and laggards will be more evident than ever before.   

What about “legacy” travel tech players? Even if it’s not in the cards to tackle travel agency services, they must double-down on technology and product. Why now? Because competitors who own both services and technology will be able to innovate faster and cater to customer demands in ways we haven’t seen before. 

As for us startups, our resiliency is being tested. Above all else, we need to be relevant in the new world. 

The new world is digital, global, omni-channel, predictive, personal and sustainable. By listening to our customers, we can recognize the future before others and move faster, more efficiently and with less capital.

 If you can do all of those things you can find ways to bring value to the ecosystem. It is what we strive for at Tripkicks - to invest in growth during a time where it’s so easy not to. I know many peers who are doing the same. Startups who can effectively navigate this environment may be on a path to becoming one of those new powerhouses, although, it’s more likely they will be a casualty of consolidation (not necessarily a bad thing!). I am certain that there is no “waiting” happening in our group. 

The industry consolidation, along with continued investment means that a handful of players will have more control and ownership over the entire user experience, and we’ll see increased competition and (finally) more useful differentiation. We no longer have to wonder what the future will look like. It’s playing out all around us, and I am excited for change. 

Regardless of your role in the travel industry, if you are part of it, now is the time that you must invest in the future. Travel suppliers will continue to pursue different growth strategies (i.e., build, buy or partner) that play to their strengths.

Smart travel managers are using this time to invest in changes to their programs, and startups are attempting to defy all odds and grow! We must all change if we are going to be part of the future, and it’s reassuring to see outside investors recognizing that opportunity.