Until recently someone looking to hire a private jet phoned a charter broker. But now a newcomer has disrupted the industry with an online booking service that works smart and delivers a more efficient marketplace. Christian Annesley caught up with Stratajet founder Jonny Nicol as part of our The Disruptors series.
Some industries out there haven’t changed much, even in this era of tech-enabled disruption to business models. One corner of business where change has been slow, albeit in a real niche, is the booking and tracking of private jets.
This is a world of well-spoken brokers and personal service and a certain amount of secrecy. But this longstanding set-up now looks like it might be abandoned for a booking platform that’s five years in the making, has been live and active for the past few months, and is underpinned by some complex algorithms to track plane movements and open up some dramatic new operational efficiencies.
Here’s Nicol’s story.
When I left the military I became a corporate freelance pilot. This included flying private jets. It soon led me to realise this was an industry with huge gaping holes in it, not just in terms of the way the industry served its customers but the inefficiencies and wastage to be seen everywhere.
It’s waste that has stopped the private jet industry being accepted by a wider audience. And that’s what got me thinking about an alternative.
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For six months it was just me. After that, I started hiring in a small way. The thing with startups is that your people needs keep changing. We’ve moved from just me to a handful and up to 14 people during our big data gathering exercise. That involved collecting masses of data from over 2,100 airfields across Europe.
We lost investor confidence and my whole staff had to work for three months without pay. Everyone believed, though, and we kept going.
We built some hugely complicated algorithms. But then the challenge was getting the database to run fast enough for consumers. The first time we ran a search it took us 20 minutes.
We shrank back down to six staff when this tech bottleneck landed. We lost investor confidence and at one point my whole staff had to work for three months without pay. Everyone believed, though, and we kept going.
The platform went live with a soft launch in November 2015. Before go-live we undertook a tour of Europe to bring aircraft operators onto the system and to ensure we had a strong enough offer to be credible.
We launched to the flying public in April 2016. By then we’d seen growth ahead of targets at every step. We are live in 44 countries in Europe and have just launched into the US market. It went live on 7 September.
Now I know: this was never done before because it’s so complex.
For the US we toured aircraft operators to put 500 aircraft on the system. It’s the same level of service as we are offering for Europe.
Inventing something new is hard. By definition you’re doing something for the first time, so you don’t know what the challenges are and how long it will take to overcome them. In business there is always an element of the unknown – but some opportunities are less defined than others.
Now I know: this was never done before because it’s so complex. It’s been a big undertaking. I knew building the system was going to be very challenging, but never in my wildest dreams did I think it would take five years.
It’s a complex pricing engine but we’ve now got the search down to 10 seconds. Believe me, that’s a computer science miracle right there!
Our goal isn’t to eliminate brokers and the old-fashioned side of the industry. Some will continue to favour the traditional method of booking a private jet, and we get that. But we would like to cut through everything and demonstrate that the booking process need not be inefficient and time-consuming. This can change the way people travel and open up new markets.
We have no ‘competitors’ although some in the industry thinks we’re one of many. Other companies make bold claims about being ‘online brokers’, but they’re not; they’re brokers with a website. They do not have the technology to do what Stratajet does.
One of the biggest challenges we now face is telling our story. We need certain people to realise that no-one else has this technology.
Skills is a big challenge, too. There is a shortage of the expertise needed outside of pure aviation. But we’ve youth on our side: a quarter of the Stratajet team is under 25 years old.
Aircraft operators will benefit from improved margins too. They will put in fewer man hours on producing quotes and see less wastage in the form of empty flights. The whole industry can progress.
We’ve 60 staff now. They work in technology, finance, business development, customer services and more. Our office is in Farringdon in central London. We are also opening an office in the US to drive that expansion.
Financing is crucial when you are pre-commercial for five years! Our CFO David Lee been fantastic. We have recently secured a $8m [£6m] round of investment - led by Octopus Ventures, with participation from existing investors Playfair Capital and JamJar Investments - bringing our total funding to $14m [£11m] to date. This let us develop additional functionality in the platform’s quoting tool and is helping us to drive forward the US expansion.
Choose your investors carefully – investment isn’t just for Christmas. Never take an investor who you don’t think is aligned with your vision. Ours absolutely are and we have an excellent relationship.
In the next year Europe and US are centre stage for Stratajet. We will add a French and German language website to the service offering, too. And we are examining plans to open a new market – the Middle East.
Now the search engine runs fast enough, it’s infinitely scalable. It doesn’t matter how many flight requests we get coming into the system or how many aircraft are on there: it will always take just seconds to return the prices. That’s one key to future growth. We have generated four million private jet flight quotes already, which shows the potential of the platform. We hope things will fly from here.