So far in 2016, travel tech startups raised just over $2.5B across 196 deals. However, deals are down, while dollars are ticking back up, albeit far from the peak we saw in 2015. Also, an increasing number of travel tech deals are moving overseas — 67% of deals occurred outside the US thus far in 2016.
After the US, India is the next-most active country in terms of investment deals to travel tech startups. Not surprisingly, the most well-funded company is still Airbnb.
We used CB Insights data to dig into travel tech investment trends, including:
We define travel tech as tech-enabled companies offering products and services focused on tourism, including booking services, search and planning platforms, on-demand travel, and recommendation sites. Car-hailing services are excluded from this analysis.
Quarterly Deals and Dollars
Travel tech startups have already raised $1B across 45 deals in Q3’16 through 9/21/16. While the quarter hasn’t closed yet, the quarterly deal count so far is down 45% compared to Q2’16, but funding is up 72% over last quarter. The funding boom is primarily due to Airbnb‘s $850M Series F round in August.
Q3’16 has so far seen the lowest number of deals of any 3rd quarter over the time period — except for Q3’12 — with 45 so far this quarter — compared to 81 deals last quarter, and 76 deals in the same quarter last year — 4 out of the last 6 quarters recorded 70+ deals.
Deal share by top countries
The top countries for travel tech deals have shifted over the last 5 years. While the US remains the most active, its share of deals has declined 10% since 2012.
In 2012, the US market accounted for nearly half of all deals to travel tech startups. Since then, the US’ share has seen a steep decline, to account for just 33% of deal share in 2016 year-to-date. The drop in US deal share is largely attributable to the rise in activity in Asia, specifically India and to a lesser extent China. The UK is also taking an increasing share of deals, accounting for 10% of deal share in 2016 year-to-date, a five-year high for the country. Germany, while still in the top five, has remained at under 10% of global deal share annually throughout the last five years.
Most well-funded startups
Airbnb is by far the most well-funded travel tech company, with more funding than the next 10 companies’ total funding combined — Airbnb has raised $4.2B to date. The most well-funded list also includes the unicorns TuJia, Skyscanner, and Decolar.
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