While 2021 has been another rough year for travel startups and the wider industry, funding rounds, both large and small, have given rise to optimism.
Standout sectors attracting investment such as alternative accommodation and ground transportation mark a similar trend to 2020 but tours and activities, business travel and hotel tech startups are also getting some love.
Below, we look at some of the travel startup funding highlights of 2021 as well as SPAC deals and M&A activity.
Rental r(evolution)
Investment appetite has been clear for alternative accommodation startups and tuck-in businesses around the segment with the trend continuing from 2021.
While much of 2020’s excitement was around Airbnb’s initial public offering, this year it has been more about vacation rental startups and RV services.
Smaller rounds were announced for rental property management platform Guesty $50 million, while Cosi raised €20 million, Cabana $10 million, Collective Retreats $23 million and RVezy $20 million.
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Also noteworthy are the SPAC exits across the segment with Vacasa going public earlier this month at a valuation of $4.4 billion while vacation rental metasearch company HomeToGo listed in September.
Ground transportation startups covering everything from e-bikes and e-scooters to rideshare, bus transport and autonomous driving is the other star of 2021 when it comes to funding.
Bus service platforms FlixMobiilty and Buser landed $650 million and $138 million respectively while rideshare and bike services such as Bolt and Lime received €600 million and $523 million respectively.
E-bike startup Tier and taxi-hailing service Gett were also conspicuous by the investment flowing in attracting $260 million and $115 million respectively.
Developing the technology around autonomous driving takes time and is costly, in the billions rather than millions, which explains the significant rounds invested in Waymo with $2.5 billion, Cruise with $750 million, Momenta with $500 million and DeepRoute with $300 million.
Other notable rounds going into the segment include $88.5 million for autonomous driving technology specialist 42dot, $107 million for transport technology company Optibus and $500 million for aviation mobility company HT Aero.
Corporate travel
Funding momentum into corporate travel startups did not let up in 2021 despite ongoing uncertainty around COVID-19 and travel restrictions.
The usual suspects, TripActions and TravelPerk, continued to attract significant funding with TripActions landing more than $400 million and TravelPerk attracting $160 million.
SpotNana, a newbie to the segment, announced $41 million in funding including investment from Concur founder Steve Singh.
A $65 million investment in corporate accommodation management platform Hotel Engine also signalled confidence in the segment.
Off exploring
While many tours & activities startups hunkered down in 2020 to save costs and devote energy to development, this year there has been a bit of a revival in their fortunes.
Startups in the segment will have received a bit of a boost from travelers, whether domestic, regional or international, looking to invest in experiences.
Easol, a technology platform for experiences providers, also recently attracted total funding of almost $30 million this year with its investment earmarked for recruitment and product development.
Looking back to earlier in 2021, Klook announced $200 million in funding in a bid to widen its platform to other travel services while GetYourGuide added an €80 million investment saying it was scoping out strategic investments.
SPACs, sales and shutters
Looking ahead while trends remain hard to call, activity around SPACs, mergers and acquisitions and business failures are more of a certainty.
There are too many others to name and there will be more down the line and across all segments as a smaller, and hopefully smarter, travel industry emerges.
The final word goes to SPACS and while mentioned above in the context of accommodation, there are more to be done.
While other travel companies such as Inspirato and HotelPlanner have announced their intentions and identified their partners, other funds are waiting in the wings without a travel target so far.
New regulations coming for SPACs and a dampening in excitement around them could leave some high and dry.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
