Start-ups and corporations in the travel sector both need to see contracts and deals from the other’s point of view to maximise innovation, a panel has concluded.
London and Partners’ Traveltech Labs – which gives start-ups a place to work and connects them with potential investors – hosted a seminar that heard from American Express Global Business Travel UK as well as start-ups Touriocity and Bubbl.
Christophe Tcheng, Vice President, Core Products and Platform Architecture at American Express GBT, said corporations such as his firm had to avoid risk by making calculated decisions.
He said: “Managing a large corporate is very hard. Working with start-ups can be a dilemma at times. It can sound like a really innovative idea, but we have to be really careful with where we put our brand – we’ve invested millions and millions in it.”
Tcheng went on to say that although an investment in a start-up may appear a “drop in the ocean” in their budget from a start-up’s point of view, he added “but someone owns that drop”, suggesting that corporates are tight-knit organisations that don’t leak money. They want to see a return on their investment.
But he also conceded that times have changed from 20 years ago, with the former “standard” way of working has been changed by disruptive start-ups.
“It’s not about B2B or B2C anymore,” he added. “It’s about giving the choice to the traveller.” From a business traveller’s point of view, he said, some workers are “compliant” and will follow itineraries while others – who fall into the ‘bleisure’ travel sector (a term all three panellists disliked) – may use new technologies to do their own thing.
Alex Grant, founder of online tour marketplace Touriocity, gave a presentation at the Traveltech Labs event – held at the offices that supported his business for a year.
He said: “Big companies can open doors but if they don’t see instant success they may lose interest. I think sometimes the corporates bottle it and walk away, so don’t always follow through and work with you.”
Grant advised start-ups seeking investment not to get too hopeful when they make deals or to be put off when they are turned away. “The hard work starts when you get in there and. Then you need to deliver.”
But Jo Eckersley, CEO of customer engagement app Bubbl – and a former holiday rep – said start-ups with limited budgets can’t always wait around for corporations to ponder over risk.
“It’s tough in these relationships with large commercial partners,” calling for corporations to be more patient with start-up companies that want to innovate.
“What these start-up companies really want is the first contract.”
Eckersley said travel could learn from the world of finance, which she believes has set the benchmark that shows that innovation trumps scale when it makes a difference to customer satisfaction.
“There’s no choice but to innovate when you are up against people who can be agile. Engaging with them is almost critical to these large institutions.”