“Seek as many references, testimonials and even case studies about a start-up and its product as possible before committing to working with it”
and is the company going to be around long enough to produce what it said?” His advice is to seek as many references, testimonials and even case studies as possible about a start-up and its product before committing to working with it. CWT’s approach to start-ups is a little different. It works with both Plug and Play in the US and Welcome City in France to help it identify companies that might solve particular pain points for corporate buyers and travellers. As part of that approach, it incubates and
tests products with a number of corporates and their travellers to understand their value and how they will fit into the overall process. The TMC is particularly looking at whether the product works, how much it costs to implement, whether it solves a particular issue and whether it can scale. CWT’s Simon says that start-ups are not
always successful in demonstrating value and ability to scale, and this process means it can minimise risk and hopefully help more start-ups prove their concepts. “It’s not easy – they need help. They think sales cycles are really short when, in fact, they are really long. A lot of start-ups don’t know how a corporate works, and they need knowledge of how procurement works.”
PROBLEMS AND SOLUTIONS Inside knowledge of the industry also helps start-ups to focus on what areas re- ally need addressing to avoid developing a solution that is looking for a problem rather than the other way around. Cherry says it’s worth checking the background of the start-up’s team to see whether it un- derstands the traveller and buyer points of view. Ruch adds that start-ups are unlikely to
survive in business if they are not addressing a problem. “At the end of the day the market dictates demand. You can get away with getting it funded but not with selling it to 20 customers.” All these risks around start-ups make it
difficult for them to get the attention of the corporate travel space, whether that’s TMCs or corporate buyers. Cherry, who worked within an alterna-
tive investment fund previously, reckons something of interest comes across his radar about once a week but acknowledges how
BUYINGBUSINESSTRAVEL.COM
Who’s on the corporate
start-up radar?
• Flyr A fare prediction start-up with early financial backing from the investment arm of insurance firm AXA and seed funding of US$3.7 million.
• Travelbank An expense management website and app that helps corporates predict travel costs and provides travellers with a budget. It has US$10 million in funding.
• Conichi An app that uses beacons within hotels to improve the traveller experience, with financial backing from hotel portal HRS.
• Trippeo A travel booking and expense management app with undisclosed start-up funding.
• Hyper A travel booking assistance application which uses chat to help travellers. It has received just over US$1 million in seed funding
• Freebird A service which reboots disrupted airline passengers. It has received US$3.5 million in funding and signed a deal with Corporate Traveller.
• Upside A service aimed at smaller companies that rewards travellers with gift cards for well-known brands if they are prepared to be flexible and save money on their travel.
• Travo A start-up for business travellers who don’t use a TMC to help find the best airfares and accommodation, which it then packages up into an itinerary. It has funding of US$2.4 million.
difficult it is for start-ups. He says everything happens so fast these days that people don’t have time to stop and put some thought to innovation and what’s out there that’s different to what is currently used. In an ideal world, TMCs would bring innovative start-ups and ideas to corporate buyers as well as the other way round. Simon says clients tell CWT their pain points, enabling it to get a “holistic view” so that it can then find start-ups that might be able to address the issues. Dentsu Aegis works with American
Express GBT, and Cherry says that, as with any partnership, he would expect the TMC to investigate relevant products and services. Click Travel’s McLean agrees that it
should be a two-way street but points out it can often depend on economic factors. “When the economy is stronger people are open to new ideas and, as companies empower employees, they will inevitably drive these changes.” He adds that the corporate travel technol-
ogy and TMC worlds have been a bit lazy and have a tendency to rest on their laurels. “There’s still this theory that the organisa- tion makes a decision and dictates the tools to staff, and that makes tech designers lazy.”
RIPE FOR CHANGE Rocketrip’s Ruch supports this view and believes there will be changes in the user experience. “The business travel ecosystem has left itself wide open for innovation on user experience. It has treated employees like cattle for a long time. The buyer of the product is not the user of the product whereas, in leisure, if it is not a seamless experience then you don’t get the booking.” While some in the corporate travel com-
munity acknowledge the need for things to change, others are still a bit slow. Simon says TMCs that get new ideas into the ecosystem and change the fastest will have a big head- start on rivals. He adds that it’s critical to work with start-
ups and that there has been a sea change in thinking within the organisation. “We need to be open and understand what is out there,” he says. “We don’t want to get disrupted. A year ago it would not have been easy to work with them; today, we look at it in a very different way.
BBT January/February 2017 93
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