It has long been said that creativity and innovation often arrive in times of crisis. Our selections of the Hot 25 Travel Startups for 2023 certainly validate that mantra.
Of the 25 startups on this list, 14 have been founded since the start of 2020 when travel - and much else in the world - came to a halt as people around the world faced the COVID-19 crisis.
In fact, nine of the 25 launched in 2021 – and are already showing enough promise to warrant their selection.
It was not an easy task. We began with more than 120 startups to consider. In making our selections, we’ve looked for indicators of innovation and growth potential and focused on startups no more than five years since founding. We have also made an effort to find companies that represent diversity in sector, location and founders.
This is the fifth year for this list, always unveiled at the opening of The Phocuswright Conference, taking place this year in Phoenix. You can read our past selections of Hot Startups for 2022, 2021, 2020 and 2019.
Looking at statistics of the 100 companies selected in the past four years provides visibility and insights into trends at the edge of innovation.
This group of 100 companies have cumulatively raised funding of $1.7 billion in total, with TravelPerk (2019 cohort) having received the most funding, at $408.5 million. The 2020 and 2019 cohorts have raised the most money thus far - $630 million and $590 million, respectively.
Seventy percent of the companies operate primarily on a B2B basis, perhaps not surprising given how difficult the consumer travel environment has been in the last two years. But B2C businesses have raised nearly as much funding: $811 million to B2B’s $899 million.
Fifty-seven percent of the companies are based in North America, while 30% are headquartered in Europe, 7% in APAC and the rest in the Middle East and South America. North America has trended down over time while Europe has gained ground.
Twenty-nine percent primarily serve the hospitality industry (19% in hotel and hostel and 10% in short-term rentals), 18% work in the air category, 10% are in corporate travel, 6% span multiple verticals and another 6% are in tours and activities.
This is not dissimilar to the travel startup landscape at large, with the exception of itinerary, inspiration and content-focused companies being quite common in the larger landscape yet nearly absent from the Hot 25 cohorts. Eleven companies have been acquired, three have failed and one merged (Setoo – 2020 selection - with Pattern Insurance). Eighty-five are still operating. Four of the 11 acquired companies are in the corporate travel space.
For each of the companies on this year’s list, we are sharing details provided to us by the founders in their own words – a description of the company, strategic goals for 2023 and lessons learned since founding. We’ve also included links to PhocusWire’s past coverage of these startups, as applicable.
Click on the company names below for details about each startup, what they have been doing and what they plan to do in the coming year.
*We would like to thank Phocuswright manager for research and innovation Mike Coletta for help with compiling the list and the data analysis above.