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Plug & Play Travel plans launch in Singapore to bridge gap between innovators and corporations – Web In Travel

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Plug & Play Tech Center, the Silicon Valley-based company that bridges the gap between innovators and corporations, is looking to launch its Travel & Hospitality vertical in Singapore to plug into what it feels is a market gap waiting to be addressed.

It held its first event last week in Singapore, inviting up to 20 startups to make their pitches to an audience of travel corporations.

Managing Partner of Plug & Play Travel & Hospitality, Amir Amidi, who was in Singapore to host the half-day event, said this introduction was to gauge the interest of corporate partners in the APAC region.

Amir Amid sees Plug & Play’s role as bringing “disruptive innovation” to the attention of corporate partners, rather than them seeing it as a threat.

The APAC Travel & Hospitality Center of Innovation will operate out of its Singapore office which looks after its interests in Southeast Asia and has investments in Singapore and Indonesia, and is expanding to Thailand and the Philippines. Its investments range from fintech to mobility, IoT, ad tech, sustainability and now travel and hospitality.

Plug & Play brought Travel & Hospitality to China last year and opened an office in Shanghai but Amidi said the response was lukewarm, which is why it’s now decided on Singapore. Having said that, he announced that Ctrip is now a partner. In Singapore, it has Singapore Airlines (SIA) and Changi as partners, and AirAsia is also among its portfolio of clients.

Amidi said the intention is also to invest in APAC-based travel startups. “It is a hot spot right now and we are missing out,” he said.

Amidi’s grandfather founded Plug & Play which was originally a real estate play, and its building in Palo Alto was home to tenants such as Uber and Paypal. “By pure luck, they were our tenants and we saw these companies go into hypergrowth in 12-14 months and we saw an opportunity to get better ROI by investing in startups instead of proving real estate services,” said Amidi.

It changed its model in 2006 to invest in early stage tech startups. Amidi left Nor1, the hospitality upgrade, up-sell, and merchandising tech company, in 2015 to launch its Travel & Hospitality practice. Today, it has investments in 10% of tenants versus the 30% from earlier days.

Even though the company still has 180,000 square feet of co-working space in its Silicon Valley headquarters, Amidi said, “We didn’t want to be another co-working space and so we brought in services that startups would need as well as bridge them with corporations who need to work with startups.

“Big corporations have a tough time sorting through the noise. Startups have a hard time getting a foot in the door of corporations, even if it solves a big problem.

“Corporations have the option to invest, for example, Jet Blue has a venture arm,” said Amidi.

The Plug & Play Travel event included a panel of industry representatives, from left: Amir Amidi; Jason Goh, MD, airport operations management, CAG; Lionel Yeo, former Singapore Tourism Board’s chief executive; Rainer Stampfer, president, hotel operations APAC, Four Seasons Hotels & Resorts; Zhu Jing, chairman & CEO, CHTA

Since making its first investment Plug and Play Tech Centre has invested in over 800 startups. In 2017 alone, Plug and Play made investments into 260+ startups, 160+ of which are based in North America, with the rest spread across Asia, Europe and Latin America. Their Travel & Hospitality portfolio consists of 24+ startups.

It invests up to US$500,000 per startup per round. It doesn’t lead or take a board seat. Amidi said it is considering to raise later stage fund of approximately $200 million.

“The pace of innovation is rapid in Travel & Hospitality and corporations are being left behind, compared with banking or retail. Everything and anything under the sky has room for growth right now.”

From granular tech such as personalisation – “send me your targeted offers based on my travel patterns” – to ancillary revenues, there is massive opportunity for corporations to up their game in tech innovation and adoption, said Amidi.

“Existing loyalty programmes are disliked by people, they are essentially a bribery, so how to build true loyalty, personalisation and ancillary is a big opportunity.”

Amidi also sees opportunities in safety and security – both in data and physical – and how to create end-to-end non-intrusive airport security. It works with four airports – Changi, Manchester, Gatwick and Pittsburg.

“The entire travel journey is broken. The average leisure traveller goes from site to site. The OTAs are brainwashing people that they have the best deals. What are airlines and hotels doing about it? Could there be one platform that offers diverse products and services?

“Amazon did it for brands and retail.”

He sees Plug & Play’s role as bringing “disruptive innovation” to the attention of corporate partners, rather than them seeing it as a threat.

With more corporations recognising the need for innovation – SIA for instance has started its own Innovation Lab – and others have started their own incubation and acceleration programmes, does that not erode Plug & Play’s value as corporations mature to the idea?

Said Amidi, “I personally don’t think individual innovation labs or incubators are the right way to go. For example, we presented 13 startups to Volkswagen over a 90-day programme.

“It is extremely hard for Volkswagen to engage with 13 startups in 90 days. Corporations are not set up on an individual basis to do anything on this scale in a meaningful way.”

The biggest mistake corporations make is to “trying to do it themselves instead of joining existing platforms with multiple stakeholders. A lot of money has been wasted this way”, said Amidi.

What the industry needs, he said, is an open innovation platform. “This would be great for the industry. It is hard for a single corporation to run an innovation programme that has ROI in the long run.”

On its part, Plug & Play earns membership fees from corporations, although Amidi said it does not make money on these fees. “What’s in it for us is the ROI we get from investment in startups. We love to follow an entrepreneur through his or her journey.”

Featured image (Singapore skyline) credit: offstone/iStock-Getty Images

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