Pandemic has surfaced “unsexy” issues, says Weinstein
IF your startup is solving a boring problem, like fixing the back end of travel, then One Travel Ventures, the Israeli-based travel and hospitality-focused fund, wants to hear from you.
In fact, said co-founder Henry Chen Weinstein, “the more boring it is, the better for me. I like it when a startup attacks an issue that is not sexy and we are seeing a lot more startups address those boring problems, some exposed during Covid and some that have been there and not addressed since the 1970s.”
Henry Chen Weinstein: “We are seeing a lot more startups address those boring problems, some exposed during Covid and some that have been there and not addressed since the 1970s.”
For example, he believes, there is opportunity in the financial side of things. “There is a disconnect between the fact that travel is this major financial power and the actual financial transaction. A lot of retailers are focused on the travel experience, not on the financial side of the business – payments, insurance, the financial services around travel.
“There are lots of startups around how to sell and price airline tickets but not a lot of payment providers that are travel-specific. Usually we have a horizontal play with a travel division but nothing specialized in travel. It’s a $12 trillion industry, it deserves a bit more attention.”
Another “new, boring problem that existed before but was emphasised during the pandemic” is the issue of disruptive flights. “A few startups are trying to solve this problem – airlines changing flights, revenue management, how you treat customers, how you compensate them. Every airline, airport is different. How do we solve this problem? Some airlines who are not selling directly don’t even have their customer details.”
Weinstein believes the pandemic has pushed “unsexy issues” to the surface and that’s what he’s interested in.
What he’s also seeing is a new generation of startups – an older generation, “people with deeper understanding about what’s going on behind the industry. They have experience, they have left their corporate jobs and they have so much knowledge that they are coming in to solve the problems.
“I anticipate a travel revolution about to happen as these new startups helmed by experienced founders try to fix the infrastructure of travel.”
Weinstein and co-founder Guy Cohen have backgrounds in investments, corporate innovation and domain expertise across the travel industry. Weinstein was last at Cockpit, the El Al innovation arm, which he founded and ran for four years from 2015. Cockpit evolved from an El Al subsidiary into a fund, raising additional capital from Boeing, Gate Group and had also co-invested with companies such as JetBlue and prominent VC’s.
“Our mantra is to be very flexible, so we are able to do any deal that makes sense to us. It doesn’t matter what stage, we are flexible on equity, exit horizon. We have done a pre-public deal, pre-seed deal.”
One Travel Ventures has two buckets of funds – one focused on travel and another looking at horizontal plays with unique technology which can be game changers in travel. “Airbnb came out of the 2008 crisis, maybe this crisis will produce a few similar companies.
Thus far, it’s invested in Reeco, an institutional procurement marketplace. “They do procurement for institutional players, not limited to travel, but a major vertical is hospitality. They are reinventing the whole business, saving time, money, and product waste on every order for hotels, nursing homes, catering and event venues that are facing the same issues. All while empowering suppliers.”
Holisto, which wants to revolutionise hotel inventory with AI and ML technologies, is another investment. “Say, you want to book a few nights in New York, they take your reservation, split it up into multiple pieces, mix and match the inventory they have as they are plugged into many potential providers and then reconstruct your reservation. For the consumer this is fully transparent and they simply get the same reservation for a much better price that didn’t exist before.”
Weinstein said its fund was not limited to deals in Israel. “We are pretty open. With the previous fund, we were 50% Israel, 50% outside.”
Its typical cheque size is around $1m.
Like most Israeli entrepreneurs, Weinstein started his career in the army and worked in R&D for security projects. After that, he transitioned into the startup world, working with corporations, and he started the biggest startup competition in Israel, the TLV Startup Challenge. “We’ve had 400-500 semi-finalists through the years and multiple exits and unicorns.”
His passion for startups has also led him to start Travel Tech Nation with co-founder Rom Shiri, a community of travel tech leaders, on which he is collaborating with Phocuswright. “It’s not a commercial initiative, it’s by invite only, and there is a membership fee. The idea is to get decision makers in the same room, discussing the industry’s most pressing topics and moving the needle. We are also supporting the next generation of Travel Tech innovators with the Travel Tech Executive Fellowship that we recently launched due to public demand.”
He said that the pandemic has strengthened his conviction about travel tech and he intends to double down on it. “I see travel as an ageless industry. It’s not going anywhere. Every historic event that has come along to hurt it is just a blip, it keeps going up.”
