Acquisitions and Investments - The Travel & Hospitality Industry is on Fire

By Alan Young - President of Puzzle Partner Ltd.

2 October 2018
  • Acquisitions and Investments - The Travel & Hospitality Industry is on Fire

Young

In the past, the travel and hospitality industry has been notorious for its resistance to incorporating new and innovative technology into the mix. There have been some early adopters but where other industries were quick to embrace technological change and practices, we were seemingly always one (or more) steps behind. And yet, this year our industry has — perhaps more than any year previous — welcomed disruption from technology solutions and movements positioned to transform every phase of the guest experience. This marks an exciting era for hospitality and becomes even more apparent as we look to the frenetic landscape of travel technology acquisitions and investments.

In 2017 alone, over 65 acquisition deals worth 17 billion USD were made in travel technology. This number has increased drastically from 18 deals in 2013, as emerging tech solutions continuously attract new investments and acquisitions. Deloitte has even stated that technology acquisition is now the number one driver for M&A activity in its M&A Trends Report for the year. Why now? As the travel and hospitality sector shifts towards decentralization and becomes more competitive, companies are eager to stay ahead of the curve with the help of strategic acquisitions and the delivery of innovative solutions. After all, once a company has matured, the best way for them to continue on a path to substantial growth is to increase market share from a competitor through the acquisition process.

To call attention to this industry-wide momentum, we've rounded up some of the most exciting travel and hospitality mergers and acquisitions that have recently made headlines.

StayNTouch purchased by Shiji

Shiji Group, the leading manufacturer of hotel information systems responsible for 60% to 70% of the market share in the high-end sector of hotel and retail industries, recently acquired StayNTouch.

StayNTouch is a cloud-based suite of hotel management solutions powering 75,000 hotel rooms around the world. In February 2016, Shiji Group was a part of a $9.5 million Series A funding round for the seamless, intuitive PMS experience offered by StayNTouch. With access to Shijii Group's existing network of sales and support teams, StayNTouch will have an opportunity to grow worldwide and develop exciting new product features.

"Our incredible growth has been exciting but joining a larger group with local sales and support network globally means we can bring our technology to many more hotels while still remaining close to our clients. It's a unique opportunity for any tech company like ours." Says StayNTouch CEO, Jos Schaap.

Umapped purchased by Flight Centre

Umapped, the leading collaborative itinerary and experience platform within the travel industry, was recently purchased by one of the world's largest travel companies — Flight Centre Travel Group. Providing travel agencies and hospitality brands the power, flexibility and speed to collaborate on proposals and itineraries with customers at every stage of travel, Unmapped has been hailed as revolutionizing the traditional travel itinerary.

Flight Centre's infrastructure, industry influence and partnerships will provide Unmapped with an exciting opportunity to accelerate the adoption of its technology on a global scale, while expanding product offerings.

"Both Flight Centre Travel Group and Umapped are pioneers in the travel industry, said Unmapped CEO, Lisa Israelovitch. "Both companies share similar values and a deep commitment to empower travel advisors and suppliers with technology that adds significant value throughout the customer journey. We are very excited to work alongside the talented FLT team to develop new product offerings with a continued commitment to customer service."

OYO secures $1B Investment

OYO, India's largest hospitality company consisting mainly of budget hotels, has pulled in $1 billion in new funding to grow its business in China and expand into other international markets. This investment round can be attributed to the likes of SoftBank Group Corp.'s Vision Fund, Sequioa Capital and Lightspeed Venture Partners

OYO is known for aggregating budget hotels and hostels in India, ensuring that they meet minimum standards such as clean sheets, hot showers and free WiFi. With over 10,000 franchised or leased hotels within its network, OYO now spans 350 cities across five countries and, following this deal, is valued at $5 billion.

"By 2023, we will be the world's largest hotel chain. We want to convert broken, unbranded assets around the globe into better-quality living spaces." says founder, Ritesh Agarwal. With the hospitality ecosystem — especially that of hospitality technology — changing at a newly rapid pace, the mergers and acquisitions momentum taking our industry by storm is sure to remain throughout 2019 and beyond. With so many complementary technology solutions positioned to fill the gaps within larger firms, the travel and hospitality industry is sure to see substantial investment dollars flowing in from emerging markets and standard VC's.

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Puzzle Partner Ltd.

157 Cumming Drive
Barrie, ON L4N 0C8
Canada
Tollfree: 888-978-8455
www.puzzlepartner.co

Alan Young

Alan E. Young is the President of Puzzle Partner Ltd. and co-founder of Next Big Thing Travel & Hospitality. Previously, Alan has held executive sales and marketing level positions with startup companies such as Newtrade Technologies, (acquired by Expedia), Hotel Booking Solutions (acquired by IBS Software) and TrustYou. Alan is past Chair of the Board of Directors of The OpenTravel Alliance and has been very involved with other industry associations most notably AHLA, HEDNA, and HTNG. With over two decades of experience in the travel and hospitality technology world, Alan specializes in helping innovative companies achieve winning performance and dramatic growth.

Alan Young

Puzzle Partner Ltd.
Phone: 705-241-5244
alan@puzzlepartner.ca