TLabs Showcase on travel startups featuring US-based EveryLodge, a new service aiming to bring together travel-related offers from private and member-only flash sale sites.
Who and what are you (including personnel and backgrounds)?
EveryLodgeâ€™s founder is Andrew Nicol, an entrepreneur based in New York City and former corporate lawyer who studied at the University of Western Australia and Harvard Law School and previously worked at Clifford Chance and Cravath, Swaine & Moore.
What financial support did you have to launch the business?
EveryLodge is an offshoot of a related service that I am developing with the funding and support of the Chilean Governmentâ€™s Start-Up Chile Program, which provides $40,000 of seed capital.
What problem are you trying to solve?
There are around 20 different websites that offer â€śflash salesâ€ť on hotels. These sales are highly attractive to customers, with discounts of up to 80% off rack rates, but spread as they are across many different websites, it is extremely difficult to find and compare deals.
Typical hotel search websites such as Expedia and Kayak are blind to flash sales, and most of the sites themselves behind login and invitation request forms.
EveryLodge solves this problem by aggregating this data and presenting sales from all of the major sources on one site.
Describe the business, core products and services?
The business consists of a web application that lets users view flash sales across all of the major sources.
Who are your key customers and users at launch?
Our users are cost-sensitive holidaymakers, primarily in the US.
We do not intend to target business travellers, because the flash sale model is not well suited to them: the sale sites are generally not accessible to the agents that organize business travel, and the sales have limited availability and are insufficiently flexible.
Did you have customers validate your idea before investors?
What is the business AND revenue model, strategy for profitability?
We intend to generate revenue by commission when a user searches for a hotel and either:
- finds a suitable flash sale, in which case we will get a commission from the flash sale site
- does not find a suitable flash sale, but is given the opportunity to book a hotel at regular rates, in which case we will get a commission from the booking agency (e.g. Expedia).
SWOT analysis â€“ strengths, weaknesses, opportunities and threats?
- First to launch; novelty has generated press coverage; simple, easy to use interface; sales offer deep discounts
- Need to develop web app further; difficulty of making the site appealing for return visitors
- The travel flash sale space is relatively new and is likely to grow at a rapid rate, similar to the fashion flash sale space, generating more interest in the service
- Other startups; pushback from the sale sites themselves
Who advised you your idea isn’t going to be successful and why didn’t you listen to them?
An early advisor suggested that the idea wouldnâ€™t work because there was likely to be consolidation in the flash sale space.
However, we took the view that it is unlikely that any single sale site would emerge dominant. This is because of the nature of the business: the sites need to negotiate directly with each hotel (or hotel group) and strike very specific deals about rates, commission, etc.
A fragmented space where consolidation is unlikely is a great candidate for an aggregator service.
What is your success metric 12 months from now?
- 15,000 flash sales tracked in the 12 month period
- 200,000 unique visitors
- 10,000 hotels booked