Travel is back on the radar for investment, with consumers and business users both moving in the same direction again after a long hiatus. Today, a startup called WeTravel – which builds tech for the special needs of group travel – has raised $27 million, money it will use to expand its business after strong growth last year.
The company works for 500,000 customers using the platform and provides payments and other tools to 3,000 companies. Transaction volumes have grown 30% and revenues are now 3X their pre-Covid levels. And CEO and co-founder Johannes Koppel believes those figures will double again by 2023 “as a conservative estimate.”
The Series B is being led by Left Lane Capital, with participation from previous backers Swift Ventures and Base10, as well as angel investors including one of Klarna’s founders, Viktor Jacobsen.
In the 8 years since its inception, We Travel has previously raised only $7 million. We understand from sources that this Series B was built for a little over $100 million.
The start, fittingly, has had its own little journey. Initially, Keopel and its two founders Garib Mehdiyev (CTO) and Zaki Prabowo (CMO) moved from the Netherlands to the Bay Area to start the business, but were unable to bring in engineers and navigate the visa waters. Other technical talent as well. So in the year In 2019, the three founders of WeTravel returned across the pond to the Netherlands. Covid paid for the idea that a start-up should keep its team in one place, and today most of the company’s business team and customers are located in America, and included there, the three founders, as well as WeTravel’s product and engineering teams, are all in Amsterdam.
The gap in the market is one that WeTravel seems to have created surprisingly with the growth of online travel services.
In the old pre-internet days, travel agents used to rule the roost in booking tickets and buying vacation packages for many consumers and businesses as individuals and groups. Online tools have changed the game for individuals, but surprisingly, it doesn’t apply to groups looking for a multi-day trip or retreat that includes multiple hotels, activities, and meals, which can involve multiple people. Multiple locations, hundreds of potential suppliers (not just hotels and airlines, but restaurants, tour operators, insurance providers and many others) and the need for flexible payment options – different people paying different amounts, payments in installments and lump sum payments. In return, it should be listed in various suppliers.
“The important part is not so much about the payment, but what happens after that, what the travel company has to do with these funds,” Keopel said. A typical trip can cost the user $10, most of which goes to suppliers. It will be about fund management. And with more involvement in travel, from restaurants and transportation companies to airlines and hotels and more, the number of suppliers will increase. On top of that, there are wire fees and different payment methods for businesses, from country to country.
The WeTravel platform covers two main parts of that process: helping people who book the group travel together to organize suppliers and plan everything. and handling different aspects of the payment process, including structuring payments at different levels, or working with different currencies and payment methods, and paying different providers on their own terms.
Keopel describes the fintech side of the business as the “PayPal of travel” and says that companies like PayPal, Stripe and other big names in online payments haven’t been able to properly handle WeTravel’s market segment. It is being used, especially when used to coordinate itineraries and suppliers with the first part of the production.
Keoppel believes this is a pattern we will see more of in the B2B fintech world. “My belief is that in the next couple of years there will be SaaS platforms that integrate payments as part of specific industries,” he said. (Indeed, you have some solutions for this today with companies like Fresha, Boulevard, and Style Seat building kits specifically for that vertical needs.)
This is something that WeTravel customers have sometimes tried and failed to build themselves. As travel agents become “travel consultants” and focus on these travel experiences, some say they build themselves into custom-made systems, but what I’ve come to realize is that what’s missing is the ultimate customer experience. . They don’t have time to build fancy billing systems and payment methods and more.
One thing WeTravel doesn’t currently do is provide discovery to its users – meaning travel advisors can still turn to their little black books, or nowadays maybe TripAdvisor, Yelp or other advice and discovery platforms to find interesting restaurants and more. . This is something that can be incorporated as WeTravel grows.
A significant elephant in the room is what happens when other big travel platforms think about how they can do more in this area: they all have big vendor relationships and it may be a matter of building or buying tools to meet this use case.
Vinnie Puji, who led the investment for Left Lane, recalled that his parents once ran a travel agency, “so this was good for me to see.” “You’re going to run into some really big markets, and this is one of them.”
He pointed out that even in the current economic situation, the winter of Covid, which has descended on travel, is melting.
“The data tells us that travel has mostly gone backwards,” he said. The company He pointed out that he thinks it has grown by 3 x since 2019, especially WeTravel. “Church groups, students, there are more stable sources of income here than destination bachelor parties.”
