SmarterTravel Rebrands as Hopjump, Secures $9.5M Funding

Travel Startup SmarterTravel Secures $9.5 Million in Series B Funding

Venture capital continues to flow into travel startups as traveler confidence increases amidst the ongoing global pandemic. Recently, SmarterTravel successfully closed a $9.5 million Series B funding round, co-led by Link Ventures and Second Alpha, with participation from existing investors.

Company Rebranding and Vision

Alongside this financial injection, the company announced a shift in its branding, moving from HopJump to SmarterTravel. This name change, as explained by CEO Jordan Staab to TechCrunch, signifies a renewed focus on delivering a comprehensive and informative online travel experience.

Leveraging AI and a Substantial Subscriber Base

SmarterTravel currently boasts a substantial audience of 7 million email newsletter subscribers. The company utilizes proprietary artificial intelligence technologies to curate travel information and provide customers with exclusive discounts.

They produce articles covering all aspects of travel, a particularly valuable resource given the evolving restrictions imposed by airlines, hotels, and various countries.

Evolving Consumer Travel Information Needs

“The way travelers gather information is undergoing a transformation,” Staab stated. “Instead of consulting numerous websites, consumers are now seeking a single, reliable source. They desire expert guidance, and that is precisely what we provide.”

From Digital Marketing Agency to Travel Information Provider

Founded in 2018 by Staab as a digital marketing agency specializing in user acquisition for major brands, HopJump initially aimed for an initial public offering. However, the company identified an opportunity within the expansive travel market – representing 10% of global gross domestic product, according to Staab – and decided to develop its own brand.

Challenges and Pivoting Strategies

The company initially focused on offering discounted hotel rates, but encountered complexities in consistently providing premium accommodations at significantly reduced prices. Staab explained the difficulties inherent in bundling strategies and maintaining value.

“Our priority became simplifying the process,” he said. “Travelers want a fair price from a trustworthy company, and that’s the problem we aimed to solve.”

Navigating the Pandemic and Strategic Acquisitions

In January 2020, the company launched its first product, quickly gaining 60,000 members. However, the onset of the global pandemic presented significant challenges, forcing the company to consider potential closure.

Remaining committed to the travel sector, the company pivoted back to marketing activities to continue monitoring industry trends. During this period, SmarterTravel proved to be a valuable resource, and when TripAdvisor announced layoffs and the potential sale of a division, Staab seized the opportunity to acquire that asset, along with Airfarewatchdog, Family Vacation Critic, and Oyster, completing the deal in 2020.

Investment Rationale and Pandemic Resilience

Lisa Dolan, managing director at Link Ventures, highlighted SmarterTravel’s growth as a key factor in her firm’s investment decision. The company’s ability to acquire other travel businesses and navigate the pandemic successfully, while many competitors struggled, was particularly noteworthy.

Dolan also emphasized the strength of their email-driven revenue model and their success in capitalizing on continued consumer interest in travel-related searches – including car rentals, city activities, and vacation planning – even during the pandemic.

Market Opportunity and Competitive Landscape

SmarterTravel is targeting the U.S. travel and tourism industry, which was valued at $580.7 billion in 2019. The company is not alone in attracting investor attention; recent funding rounds include $3 million for Thatch, a platform for travel creators, $175 million for travel tech company Hopper, $2 million for Wheel the World, a disability-friendly vacation planner, and $2.1 million for Elude, focused on spontaneous travel.

Future Growth and Expansion Plans

The new funding will be used to accelerate SmarterTravel’s growth, increase brand awareness, develop new travel products, and expand its team. Currently employing 50 people, the company intends to add further personnel, according to Staab.

“While the travel industry has faced difficulties, certain segments are recovering, and we are observing positive trends,” he added. “Despite a challenging year, our revenue has increased significantly – eightfold in the last 12 months. We are profitable, well-funded, and strategically positioned for continued growth.”