Swiss company TrekkSoft has lofty ambitions, wanting to muscle in the growing tour and activity marketplace with its own payment gateway system for operators.
So, welcome to TLabs…
Launched in 2010 with a capital investment of Swiss Francs 100,000 ($103,000) from the founders,Â Valentin Binnendijk (product manager), Philippe Willi (CFO) and Jon Fauver (marketing manager), TrekkSoft is looking at what it says are 250,000 tour and activity companies worldwide, many of which are still using paper and ExCel to manage bookings.
In the US alone, TrekkSoft (via a PhoCusWrightÂ study) says only 15% of these operators are using online booking systems, with the figure estimated to be even lower at a global scale.
But with 55 operators already signed up to the system and a further Swiss Francs 100,000 expected to come into the business by way of friends and family this year, TrekkSoft is hoping to take the business to the next stage.
The company admits it has strong competitors in the likes of TourCMS, Rezgo and CheckFront, but says the trio are “a step further with their marketing and branding efforts, but not in terms of product features or benefits”.
Rare fighting talk from the traditionally neutral Swiss, then, but the business plan of 6% fee on all online transactions (includes any credit card fees) though free for offline (over the counter, point-of-sale) is already looking at processing around $10 million in online turnover as the next milestone to achieve.
Q&A with Philippe Gerber, chief technology officer:
How is the way you are solving this problem more special or effective than previous attempts you or the market has seen before and how different do you have to be to succeed?
TrekkSoft offers a unique integrated payment gateway, which none of the competition offers. The big advantage to this integrated payment system is that you do not have to set up credit card contracts or PSP (Payment Service Provider) contracts.
With our system all tour operators are supported, regardless of size.
The system fulfills all requirements of a complex tour management software including capacity management, yield price management, as well as promotional tactics like vouchers and discounts.
Why should people or companies use your startup?
- We are making business easier for tour operators worldwide
- In 15 minutes you can set up a mandator for free
- Our software is already used by 55 tour operators
- 200,000 customers have been booked through TrekkSoft to date
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?
We are planning on opening a US branch and hiring a marketing/community manager and several interns to kick-start our marketing efforts.
What other options have you considered for the business and the team if the original vision fails?
We would potentially restructure the team and look to revamp our marketing strategies and positioning.
However we would keep the current online transactions and existing 55 active tour operators as the model has already proven to break-even even at its current growth rate.
What mistakes have you made in the past in business and how have you learned from them?
We put all our effort into new functionalities and features for our existing mandators and less focus on marketing and attracting new users.
Therefore the product became very robust functionality-wise, but the user experience was a little tougher to navigate for the non-expert user. We need to focus more on the needs of smaller companies while ensuring we are always incorporating their feedback along the way
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
Most innovation in this segment has focused on the hotel and flight industry. There is still huge potential for other segments.
The existing players are not very innovative on the technical front and have failed to address and incorporate new developments in social media and mobile.
Given that the ratio of B2B travel startups compared to consumer-facing brands featured on TLabs that have not made it past two years is low, TrekkSoft is naturally in a good spot given its focus is on providing what it hopes is a solution to a pretty big problem in the industry.
Whilst it is difficult to determine if 55 customers that have signed up to use the platform is good or not, proof will be how many the company actually retain and how much those operators are making the most of the technology as a means to enhance their payment strategy.
One challenge will potentially be keeping up with alterations and modifications from suppliers. In the hotel sector there are only a handful of ways of working when it comes to payment and reservation systems (rates, room types, contracts, negotiated deals, etc) but in tours and activities there are arguably dozens – even hundreds – of different ways of working given that the product is often diverse and very complicated to organise.
But the prospects are enticing in this particular sector of the industry. If TrekkSoft markets the product efficiently and shows solid technical performance then there is no reason why the company cannot move alongside the competitors already in the market and others that are likely to also eye the same opportunity.