Tripkicks, a New York City-based travel technology firm that rewards business travelers for spending under budget, expects to pursue a capital raise within the next six months or so amid a booming travel and expense (T&E) management sector, said CEO Jeff Berk.
Speaking last week on the sidelines of the Global Business Travel Association (GBTA) Convention in Chicago, Berk characterized the upcoming raise as a “larger seed round,” but declined to disclose the exact size of the raise.
The round will primarily target existing investors, including its majority shareholder Acquis Consulting Group and some friends and family, and will possibly be open to outside investors, according to Berk, who was previously a managing director at Acquis.
The two-year-old company completed a Seed round of less than a couple of million dollars last year, Berk said. New funds will help it onboard some larger clients, scale sales efforts and add incremental functionalities to its platform, he added.
Tripkicks is also in talks with “a number of” VC funds that are focused on the travel space, in anticipation of a Series A raise that will help it “see through some larger accounts” further down the road, he said. However, there is no predefined size nor timetable for the A round at this time, he noted.
“When you look at a typical VC and what they’re looking to invest in, we’re still early for that,” he said. “Now, it’s about building those relationships. We want to make sure we’re on their radar and we’re an interesting company that they’re watching.”
VCs are betting big on corporate T&E management-focused startups who are making business travels easier and cheaper, Berk said.
In June, California-based TripActions said it raised USD 250m in Series D led by Andreessen Horowitz, bringing total amount raised to USD 480m and increasing its valuation to USD 4bn. In March, Boston-based Lola.com brought in USD 37m in Series C funding led by General Catalyst and Accel, while last April, New York-based Rocketrip garnered USD 15m in Series C led by GV, formerly Google Ventures.
Eventually, a sale to either a large corporate travel management business such as BCD Travel, American Express Global Business Travel and Carlson Wagonlit Travel, or a major global distribution system provider like Sabre [NASDAQ:SABR] and Travelport will be a logical outcome for the business, Berk predicted.
Founded in early 2018, Tripkicks has developed a traveler-centric platform to help companies lower travel costs by rewarding employees who spend under budget in the form of an eGift card, a charitable donation or cash. The system can easily be configured and integrated into a company’s existing travel and expense management portal. It generates sales by taking a percentage cut in savings, Berk said.
Tripkicks released minimum viable products (MVPs) with “a handful of” clients last year and officially launched the product early this year, Berk said. Today, it sells both directly and through channel partners, including T&E management providers, corporate travel agencies and global distribution system providers. Its current partners include Gant Travel, BCD Travel and SAP Concur.
by Liying Qian in Chicago