TLabs Showcase on travel startups featuring US-based hotel private sale service AwayIGo.
Who and what are you (including personnel and backgrounds)?
AwayIGo was founded by two co-workers who grew tired of hearing complaints about sky high hotel rates at low quality hotels.
We are trying to answer the question â€śWhere can I take my family on vacation this spring?â€ť.
The OTAâ€™s are helpful at finding properties for specific travel dates as well as a â€śkitchen Sinkâ€ť approach to travel deals, where travellers have to sort through a significant amount of garbage just to find out that the deal which was promoted has significant restrictions or has expired.
With savvy internet marketing backgrounds, AwayIGoâ€™s founders are leveraging their travel industry knowledge and online marketing expertise to help fill a void in the hotel space by providing travellers with the most exclusive hand picked hotel deals.
NB: Unfortunately, both co-founders still maintain their day jobs to keep the lights on, so theyâ€™d prefer to keep their personal bios private – that is, until AwayIGo allows them to focus solely on this business.
What financial support did you have to launch the business?
AwayIGo is operating via a self-funded seed round of financing.
What problem are you trying to solve?
As constant travellers and people who spend as much time in hotels as we do our own beds, we found rising room rates that were not consistent with the value of the hotel stay.
While there are many hotel websites that try to be everything to everyone, or only focus on the 5 star travellers, there isnâ€™t a site that helps middle class families, and limited budget travellers find good deals at great properties without all of the clutter.
By hand selecting the hotel properties that we feature, weâ€™re bringing quality hotels to our members by offering them rates / packages that is typically only offered to groups.
Describe the business, core products and services?
AwayIGo.com is a memberâ€™s only website that brings together people whoâ€™ve expressed an interest in great hotels at a discounted rate, with hotel properties looking to sell rooms.
Leveraging AwayIGoâ€™s database of members, weâ€™re able to promote properties and sell hotel rooms by offering exclusive â€śdealsâ€ť with group rates.
With each new hotel deal thatâ€™s active, we deploy an email introducing the property and letting our members know how long theyâ€™ll be able to capitalize on this great offer and when the dates are available to book.
Who are your key customers and users at launch?
Our key customers are people whoâ€™ve expressed an interest in travel and are looking for exclusive hotel deals.
We focus on median income families who donâ€™t have the luxury of staying at the best properties with the highest rates. We also have a big following from business travellers looking to upgrade their hotel, but stay consistent with Travel Expense constraints.
Despite the recent launch, AwayIGo has had tremendous success growing our membership.
Additionally, our other key customers are the hand selected hotel properties that we feature. Â It is a combination of the property, rates, value of the deal, dates, etc. that go in to determining which hotels we will feature.
Did you have customers validate your idea before investors?
Yes. Â AwayIGo.com has validated the business model with our beta launch. Â We have an investment strategy that will support our growth through 2011.
What is the business AND revenue model, strategy for profitability?
Ultimately AwayIGo is a site with the power to refer significant business to our hotel partners, which we plan to monetize.
The more members we can attract and the more hotel rooms we can help hotel properties push, the more successful we will be.
SWOT analysis â€“ strengths, weaknesses, opportunities and threats?
- AwayIGo was built with middle class families and people with limited budgets in mind. Â We feel that the â€śValue Travellerâ€ť market is underserved. By focusing on this market and providing exclusive hotel deals that are hand selected, we feel like weâ€™re filling a big void. Additionally, by making it easy to join, we have a big opportunity to leverage social channels and word of mouth, to grow at quick rate. Once we have achieved a critical mass of members, it will be very cost effective to drive traffic to individual hotel deals. Â In addition, we are focused on referring high quality buyers to hotel booking engines. Â As a result, we do not have the costs associated with actually taking reservations.
- On the flip side, we donâ€™t have an enormous marketing budget and will need to produce successful results at a quick rate. Â With that in mind, weâ€™re faced with the challenge of utilizing more unpaid methods to build our brand and customer base, as opposed to paid strategies.
- The online travel market in the US alone exceeds $50 billion. Â Nominal market share in the hotel booking space can equate to a significant business opportunity. Â In addition, hotel properties always have a need to sell more rooms, just as consumers always have a desire to save a few dollars at a great property.
- OTAs have existing brand awareness and customer bases to leverage. Â Other players also exist in the hotel â€śPrivate Saleâ€ť space, but they tend to be focused on very high end properties.
Who advised you your idea isn’t going to be successful and why didn’t you listen to them?
We consulted with a number of people who reviewed our business plan before launching AwayIGo.
During the process, the overwhelming response was bullish. Yes, there were many deep conversations questioning certain facets, but the overall feeling was optimism.
Typical feedback pointed to the fact that the OTAâ€™s own a significant piece of the online booking process, not to mention the hotel properties themselves.
AwayIGo feels strongly that consumers will embrace a source of hotel deals that breaks through the clutter by featuring a select number of high value properties at great rates.
What is your success metric 12 months from now?
The main metrics revolve around database growth and hotel nights booked. Â We have targeted 3 million new members within the next 12 months.
With that goal in mind, we have an aggressive contest that weâ€™ve put together to promote sharing AwayIGo with your friends and pushing them to sign up with a chance to win a dream hotel stay.
Additionally, we have hired some people to focus on the editorial side. For example, we recently published our first annual list of the Top 10 Bachelor Party Hotels.