TravelPerk
The market
Currently sized at over $1.1 trillion, the corporate travel industry is a huge market undergoing a profound transformation. While its size is at par with leisure travel, the pace of innovation and user experience in the corporate travel sector has long lagged its leisure equivalent. For CFOs, the lack of transparency and control over what is often the second largest controllable cost, after payroll, is unacceptable. And for corporate travellers, outdated technology paired with non-responsive customer service and complex reimbursement processes lead to unnecessary frustration.
As a result, the share of corporate travel spend 'managed' by a travel company has remained constant around 30%. However, in the last few years, the industry has begun to see a secular shift from unmanaged to managed travel spend as newer solutions emerge that respond to companies’ demand for i) greater visibility over spend and enforcement of policies; ii) real-time customer support to cope with the rise in travel disruptions; iii) heightened focus on emissions reporting, and iv) duty of care to map employee locations in a world with heightened geopolitical and health risks.
The company
TravelPerk offers a one-stop shop for business travel that adds value to all stakeholders.
For travellers, it provides a true 'consumer-grade' experience thanks to i) its leading tech platform that holds the world’s largest travel inventory, not just a narrow sub-set of favoured providers; ii) its superior, 24/7, AI-powered customer support, and iii) its ability to prevent out-of-pocket expenses and painful reimbursement processes.
For the CFO, TravelPerk provides a transparent solution that enables cost control (travel policy enforcement, VAT reclaim etc.) and compliance (emissions reporting, duty of care etc.).
As a result, it is no surprise that over 65% of TravelPerk’s new clients were previously unmanaged – showing that the company is perfectly poised to benefit from the ongoing secular shift.
TravelPerk is led by its founder and CEO, Avi Meir. Avi’s leadership has set the tone for a strong and authentic company culture, and we believe this is the “secret sauce' of the company.
The Investment Case
At Kinnevik, we believe the corporate travel market is attractive given i) its huge size; ii) the obvious gaps in product standards; and iii) the self-serve dynamics that result in employee-driven adoption of its solution, which in turn results in hypergrowth.
From an investment perspective, corporate travel offers significantly better marketing efficiency than leisure travel. Companies are acquired once and see a high share of employee usage within the “walled garden”, rather than relying on Google and re-acquisition costs.
TravelPerk exhibits all of the attributes mentioned above and is the perfect example of corporate adoption of consumer-like solutions. The 'Consumerisation of Enterprise”.
