Barcelona-based Travelpark has beaten US-based rival Nextel One of the sector’s hardest hit by COVID-19 as the epidemic drives consolidation.
It is not disclosing how much firepower it is shelling for NexTravel, which has some 700 customers globally and has processed nearly 300,000 trips since it was founded back in 2013, but says the deal is now Is the largest acquisition by far – America with the aim of beefing up its business. (Even today it is announcing a partnership with Southwest Airlines that plugs a significant gap in its US offering.)
America has always been the top five market for travelpark CEO and co-founder, Avi Mir, but it became its largest market after the NextTrail acquisition.
“American customers, America knows how, [US-based] Team, “he said, listing the drivers for the acquisition.” They’ve created an amazing product. It’s a Y Combinator company that started 2-3 years before us and they focused only or mostly on the US market. Is, so they have an expertise that is very complementary to what we’re doing. “
Mir confirmed that NexTravel’s founder and team are joining TravelPerk as part of the deal. Current customers include the likes of Yelp, Striped and Harry.
“They are a great company. I really think we have a very good execution and we are in a crisis with a better cash position and COVID-19 is creating opportunities that did not exist before, ”he said. “We had favorable competition and in terms of the situation we were in a better position to achieve them.
Over time there are plans to move users of the American product to the YatraPark platform, but Mir said the NexTravel team will continue to support the product for the future, while aiming to ensure a smooth, final, any functionality gap. Works on understanding and plugging. Transition for future NexTravel customers.
The acquisition is second only to Travelpark after taking on risk management startup Albatross last summer – outlining how the coronovirus crisis is outpacing priorities for businesses in the travel sector.
Or at least those who have enough money to see them through lack of revenue. And Mir confirmed that Travelpark keeps its eye on more acquisition targets.
“We’re in the process of talking with someone else [potential acquisitions], “He said,” consolidation usually happens in a moment of crisis so I think it’s reasonable to expect more from this. “
While ahead of TravelPerk in starting the travel business for a few years, NexTravel has grown significantly less on its run – pulling in funding at around $ 4.5M, according to Crunchy.
The young Spain-based startup, meanwhile, has grown rapidly and has grown orders of magnitude higher (~ $ 134M to date) – including a $ 60M top-up in its Series C 2019 When it was reporting 2,000 customers globally.
“We just happen to be in Europe,” Meck told TechCrunch, discussing how his European startup is in a position to buy out an American competitor (when the reverse is all too often the case in tech) – and point to knowledge of localization As a major benefit while. “We were never targeting the Spanish market, especially in the European market.
“To win in the business journey, one of the paradoxes is that you have to build a very local product… so we have never seen ourselves as a European business that we just know we have somewhere Also to be successful will have to be really in-depth localization. But we have to do it worldwide. Therefore, this acquisition is another step of localization for the US. “
“[The acquisition] Obviously, with the participation, commercial investment will drive a lot of product development. “In a way we’re doing this knowing that it will force us to do more of America – so it’s like a self-fulfilling prophecy – but it’s a $ 300BN business travel market, so we need to There should be some better steps around. “
Harassment continues in most parts of the world due to the epidemic – including both the US and Europe – with the potential for 2021 to be substantially less billions of dollars on business travel value to grab for massive gains. And Meyer said that TravelPark is not expected to see a revival in the market before the second half of this year.
However, he remains firm that once vaccination starts among the most vulnerable groups in society, travelers will once again step up – predicting that zoom fatigue and a boom in remote work-to-face. Will again increase the demand for human contact on the front.
“My best guess right now is that everything is around the second half of this year – may be around May-June – where the seasonality is to be expected. Meaning we will see the same drop in hospital deaths and deaths as in That we saw last year. I hope so, “he predicted.” On top of that we have vaccines … hopefully within the next 4-5 months we’ll see [vaccine rollouts] Fast and then everything is transformed. We need a population of risk to be safe to reopen the world. “
He added, “That doesn’t mean we’ll be with Corona completely but it won’t be as deadly as it is now so that we can open up more and remove restrictions and watch the trip again.”
Businesses cannot be accommodated after staying with COVID-19 in a new, ‘more digital’ generic way – businesses are coming to rely on a suite of videoconferencing and virtual meeting devices – Mir envisages a short trip replacing the pre-pandemic industry, predicting a “roaring ’20s” revival for business travel, “Zoom Fatigue” and the once lifted social disturbance restrictions by FOMO can go.
“If you still own any Zoom shares then you should sell them!” He (clearly) quipped, speaking through a zoom call. “It’s going down from now on. Everyone is tired of it. Zoom fatigue is real. It creates a lot of mental health concerns, social isolation … Maslow’s Pyramids of Needs is still here, and it’s stronger than ever, I think, because we realize when we meet people in real life If you do not get, then how bad. When everything has to happen through a proxy for this strange, human connection. The virus does not change human nature. We still need to meet each other face to face. “
“The first sales person who is going to lose a sale because the competition went and took the customer to dinner and they wanted to do it via Zoom, they are on a plane the next day. So the competition will sort it out – even if we keep aside human nature, ”he said. “I think we all have an even greater recognition of how much human connection we need.”
So, even though some “transactional meetings” run permanently for Zoom, as Mir acknowledges “might” happen, he said they are not the primary driver for the bulk of business travel anyway.
In addition, the epidemic will create new demand for business travel as the boom in remote functioning remains a requirement for distributed collaborators to travel to face each other face-to-face, Mir argued, certainly more flexible. The job is to stay here.
“My team, like many other teams, used to be all in Barcelona in the same building – and now we allow them to work from anywhere in the world. Because why not? Many companies will think the same from me. “” We’ve assumed that people like it, employees like it and it’s cheaper, because you don’t have much real estate – and people are more productive and are happier and have a better balance between their personal and Work life.
“So it requires a new kind of travel because … you have to bring [your team] For a week of work together. So I think that this one-hour transactional call has led to a small drop in business travel, which you can move to zoom – even more – that requires a new way of working, In which a new type of business travel is required.
While TravelPerk was fortunate enough to go to the capital, topping its C Series in 2019, investors’ interest in travel startups undoubtedly went on holiday for much of last year. But, again, Mir suggested, an uproar on that front.
“We don’t need to raise any time soon – we have enough cash. The business is expected to return to Q4 of Q4 sometime this year. “After saying that, what’s interesting – and I don’t know if I’m alone – have we gone from there [being a fast-growing company] And you get a lot of inbound from investors and then COVID-19 hit and my inbox was empty for a while.
“It was very sad, very pathetic. And then the last few weeks – since the beginning of the school year – September / October, my inbox is no longer empty. So there is some movement in the market. There is a lot of money in searching for a home for a good investment. And I think that even in an industry that is clearly suffering, good companies can grow to good positions right now. So I am not looking to raise but I am always open to opportunity.