A New Wave of Travel Tech Arrives for Growth Equity
The Travel Tech space is large with mature consumer adoption and has attracted abundant VC attention. So, is it too late for growth equity participation? The typical reaction we’ve grown accustomed to in our end of the VC ecosystem is “yes” – that the kings and queens of the sector have already been crowned and any innovation over the near-to-medium term will just be incremental.
While this view of the Travel Tech ecosystem may have been valid a few years ago, we believe that recent trends in the space paint a more compelling picture for growth stage investors. Consumer expectations for a seamless and personalized travel experience have made it increasingly difficult and complex for vendors to meet expectations. Therefore vendors both large and small are turning to technology to help close the experience/expectation gap, creating demand for travel-sector tailored B2B and B2B2C software which has historically only been available to the very large end of the market. We believe that this chasm between consumer expectations and vendor capabilities is creating a tremendous opportunity for growth equity investment in a New Wave of B2B and B2B2C Travel Tech companies.
The latest in a long history of Travel Tech innovation, these New Wave businesses are finding success through leveraging existing travel ecosystems (e.g., Guesty, HyreCar), unlocking underutilized supply (e.g., LoungeBuddy, HotelTonight), and repeating/improving on the successes of incumbent business models (e.g., Peek, BookingPal).
Catalyst believes that Travel Tech presents a compelling market opportunity and welcomes discussion with growth-stage B2B or B2B2C business in the space. For our first foray into the New Wave of Travel Tech, we frame the broader market by separating it into three main verticals: transportation, lodging and activities. In future reports, we plan to focus on adjacent spaces (i.e., corporate travel, loyalty programs, etc.) or targeted areas within these three main verticals.
We are specifically seeking companies that generate a minimum of $7 million of run-rate revenue and are interested in raising expansion capital. Please send inquiries and business plans to [email protected].