During last week’s ITB Berlin, Chris Hemmeter, the managing director of Thayer Ventures, noted that established travel supply companies such as hotels and airlines are now more receptive to working with startups, indicating a positive change in mindset since before the pandemic.
Hemmeter described the significant change in the sector following the pandemic and the lack of agility from the supply side of travel, resulting in companies furloughing staff and flattening themselves.
As a result, many organizations started testing and trialing startups and engaging in ideas, which is creating a more dynamic and exciting space for entrepreneurs and investors. Hemmeter also mentioned the surge in interest in owning one’s own destiny and entrepreneurship, with many new companies springing up in 2022.
However, Jan-Fredrik Valentin of Ennea Capital Partners is less positive about the startup funding landscape, especially for Europe, and believes there is a need for more early stage funding as well as corporate venturing.
Lucille Cornet, a partner in Eight Roads, agreed with Hemmeter, stating that rising customer expectations are driving change, and the travel industry needs to rebuild, rethink, and modernize if it wants to stay competitive.
Valentin, a panelist at a recent Phocuswright event, has stated that Europe lacks corporate venture capital compared to the United States, and that IPOs and new investments in early-stage startups are scarce in Europe. The panel, moderated by Charuta Fadnis, also discussed startups’ move towards more efficient growth and changes in the capital landscape.
Cornet, another panelist and investor in OTA Insight and Amenitiz, emphasized the importance of investing in startups to help them continue investing in their product, rather than solely focusing on profitability. He also noted the current trend towards discussing the cost of growth and investment, rather than just top-line revenue.
Hemmeter, the third panelist, believes that the cost of borrowing has changed, leading to a shift towards efficient growth and business models focused on profitability, rather than just growth. Hemmeter sees this trend as positive for the startup ecosystem, as it allows the best ideas to succeed and monetize.
