It’s been almost five years since PhocusWire named us one of the Hot 25 Travel Startups of 2020. Since then, the industry has experienced breakthroughs in AI technology and numerous mergers and acquisitions in the travel space around the world, making these companies excited about the opportunities ahead. I even worry.
Remember, these are the businesses we identified in November 2019 as likely to grow in 2020. At that point, we had no idea that the coronavirus pandemic would bring travel to a halt three months later. Therefore, it is remarkable that they not only managed to survive those difficult times, but also continued to rise and grow.
Our 2020 graduates have undergone developments such as name changes such as Allfly, formerly known as Bacarai, and Mize, previously known as Hotelmize, to better reflect the evolution of the business. .
Others continued on their original path. We checked into several hotels including Magpie, Questo, and Futurestay. Answers have been edited for brevity.
all fly
Allfly (formerly Bacarai) is a travel management company (TMC) focused on simplifying and optimizing the travel experience for businesses, schools, and meeting planners.
Co-founder and COO Kenny Totten:
The biggest challenges I’m working on today…are definitely product and technology related. The ever-changing airline distribution landscape places high cost burdens on all travel companies, and young travel companies like AllFly are feeling it even more. With the rise of NDC, One Order and airlines pulling out of GDS contracts, the challenge is to have all the content and features that customers expect from their stake.
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My take on the current funding environment for travel startups… To date, we have raised $6.7 million in two rounds. The current funding environment is tough and without significant growth or traction, funding will go uphill.
M&A activity is increasing in the travel industry. My approach to evaluating such opportunities on the buyer or seller side is as follows. We are definitely seeing increased interest from P&E companies and travel buyers. We have been contacted more than 15 times in the last 6 months alone. At our scale, it’s still too early to consider an offer.
The technologies and innovations that excites me the most are because… This sounds like a cliché, but AI and building your own large-scale language models (LLMs) are the ones that excites us the most. We believe that AI will change the way travel is supported. It will likely be many years before AI agents replace human travel agents, especially when it comes to changes, trip interruptions, and cancellations. The days of travelers waiting on hold to speak to an airline representative are coming to an end. The company recently introduced an AI chatbot to its booking platform, Quest. Alice (as we named her) performed great, resolving over 90% of non-action-oriented inquiries.
Mise
Mize (previously known as Hotelmize) is an AI-driven, data-powered, fully automated hotel booking optimization solution that empowers customers’ purchasing power and standardizes data across supply and sales channels. We aim to maximize the potential of our customers.
Founder and CEO Dor Krubiner said:
The biggest challenge I’m working on today is…growing the company in the right way from an organizational perspective. As we have expanded the range of products we offer to the market, we are now focused on building a structure that effectively supports the growth it generates and allows us to expand these products.
My take on the current funding environment for travel startups is that the focus is on having a solid business model and prioritizing profitability over rapid, unprofitable growth. Investors recognize the industry’s potential, but are now more selective than ever about where they invest.
M&A activity is increasing in the travel industry. My approach to evaluating such opportunities on the buy or sell side is to focus on product and partner-based synergies. At Mize, we believe that being able to offer multiple solutions to our partners is critical to driving mutual success and enabling us to create greater value for all stakeholders.
The technologies and innovations that excites me the most are… Advances in AI infrastructure and supporting tools that enable the deployment of advanced AI models that can predict future behavior in real time. This significantly reduces time and costs, accelerating the pace of bringing new ideas to market.
magpie
Magpie is a content channel management platform for the tours and activities industry that allows suppliers to upload and manage content, while distributors can ensure their listings are up to date.
CEO Christian Watts:
The biggest challenge I’m currently working on is that…in this world of generative AI, so many things are possible and opportunities open up in multiple directions. Considering exactly what to build has, ironically, become much more difficult. Clearly, this is both a challenge and an opportunity.
My opinion on the current funding environment for travel-related startups…Currently, we are not raising funds. I’ve heard from others that fundable startups now need to rely heavily on modern AI. There are currently many uncertainties surrounding AI technology, so it is important to demonstrate a sustainable moat.
M&A activity is increasing in the travel industry. My approach to evaluating such opportunities on the buy or sell side is as follows. Everything is for sale. I think that’s almost always the case. Personally, I’m only really interested in things that lead to rapid implementation of the latest AI technologies.
The technology and innovation that excites me the most is because…no technology has ever come even close to the potential impact of the current LLM. For me, it’s about making disruptive changes to benefit the industry.
future stay
Futurestay is a short-term rental management software that helps hosts earn more income from their homes.
Founder S. Philip Kennard:
The biggest challenge I’m dealing with today is…it’s hard to respond to the long tail of the market. The one-size-fits-all approach taken by other short-term rental (STR) technology industries just doesn’t work for the independent segment. We help everyday people succeed. This means being flexible and responsive to different personas, needs, motivations, and challenges. The reason no one wins in this segment is because it’s difficult. Your product shouldn’t just work; it should provide the experience and results your customers need. A big part of that success is the human service that accompanies the technology.
Not coincidentally, this is the segment that will win in the STR industry over the long term. Since COVID-19, the number of individual hosts has increased by 75%. SPAC-backed corporate executives and master leasing models have largely come under fire, with multiple bold-name billion-dollar companies suffering delistings and bankruptcies over the past 24 months. For better or worse, the $200 billion-plus STR industry has always been and always will be about people and their homes, and the companies that find ways to best help them succeed in STR will win. It will be.
My take on the current funding environment for travel startups is that…teams that solve real-world problems in innovative ways will win funding…all other teams will face some challenges. That means it’s possible. Reinvigorated in Q3 and new investor focus on post-seed platforms targeting individual STR owners and operators, resolving the hosting journey remains a blue ocean opportunity, with comparative This reflects the reality that the market is out of reach of well-funded incumbents that focus on small but mature companies. segment.
M&A activity is increasing in the travel industry. My approach to evaluating such opportunities on the buy or sell side is as follows. If it’s part of our core strategy, if it’s 1 + 1 = 3 or more, or if it aligns with our vision, we’re interested. Additionally, every opportunity is unique and we evaluate it accordingly.
The technologies and innovations that I’m most excited about are…the technologies and innovations that we’re working on. Because they will change this industry for the better, forever. stay tuned.
quest
Questo is an urban exploration platform that enables tourists and locals to discover cities by providing real-world, gamified social experiences.
Alex Govoreanu, CEO and Founder:
The biggest challenge I’m working on today is… I think distribution is always the main challenge for most consumer startups, and that’s true for us as well.
My take on the current funding environment for travel startups… I don’t think travel startups have been that popular over the past few years, with outliers here and there. But in today’s world, the situation is even worse considering that AI is getting most of the hype. That being said, if you build a great business it should work out anyway and that should always be your main focus.
M&A activity is increasing in the travel industry. My approach to evaluating such opportunities on the buyer or seller side is as follows. …We have a vision to execute, but we are always open to partnering with companies that have synergies with Questo.
The technology or innovation that excites me the most is…because…without a doubt, AI. We’ve been using this for a few years, and while it’s been a game-changer in game creation, what we’ve done is nothing compared to what we’ll be doing in the next 6-12 months. I feel like I can’t stand it. All I can say is that with AI, the world really becomes a playground.
PhocusWire’s 25 Travel Startups to Watch in 2025
We selected the Hot 25 Travel Startups of 2025 after reviewing over 160 startups from around the world. The list will be published on PhocusWire on November 11th.
