One notion from last week’s discussion with Jean-Francois that particularly resonated was how significant change – everyone knows the travel industry has experienced and continues to – enables lucrative opportunities.
People ask if the pandemic is forcing me to switch away from exclusively investing in travel companies versus opening up our mandate for other industries, to which my response is a resounding NO. Absolutely not; it’s more profitable to make travel investments with the industry turning the corner on COVID (tangibly and in sentiment).
Now Is Exactly The Time To Invest In Travel
I posit, and my travel investment strategy mirrors this, that times of significant change are exactly when smart money should be investing. Of course, I’m biased, but anybody who knows me appreciates that I’m in no hurry to invest in any prospective investment.
I hate the factors that created these investment opportunities — the pandemic itself and the immeasurable toll around the world — but If you’re like me where you see travel investing not only in the short but also in the medium and long term, now is the time to invest.
I’m seeing countless travel investment opportunities (Sep 2022) at valuations I could never have imagined in parts of the world that are yearning for investment more than ever. From a relative valuation point of view, the two investments we made in the past 12 months have increased more than any other investment in the past decade.
Don’t Be Afraid of Change
In stock market parlance, one wants stocks to increase (my favorite) or decrease in value, but the worst (relatively) is if the stock price does nothing but stay at its current level. Do something, but not nothing.
I remind myself and you not to be afraid of significant change. To me, this translates into leaning into change and focusing on finding opportunities within the current evolution of the travel industry rather than pretending they aren’t there or assuming there are no opportunities (which outside of the travel industry often believe).
One needs to look at our deal calendar (what deals we want to complete for each of the next 12 months), which is as complete, and for ~60 days until I started to calm down, more lucrative and in number than it was pre-pandemic.
As I’ve alluded to in other posts and regular discussions with members of the travel, business, and tech trade, there are pockets of growth within the travel industry if you know where what and when to look. I even took the liberty of naming areas of the world and opportunities in a Feb 2022 post (some seven months ago).
7 Rights Approach
The 7 rights — finding the right company, in the right space, at the right time, with the right amount of funding, with the right team, the right growth plan, and right now — is more applicable than ever.
I can appreciate people thinking it’s the wrong time to invest in travel, but I’m also able to make the case to the contrary (thankfully, our co-investors & LPs agree).
I would say they were right if it was 12 months ago or 18 months ago, but that’s completely changed now, and my experience and the data points I track make an overwhelming case to invest in travel startups, travel companies, and as an industry.
