China Leads the APAC Market in Travel Startups

Travel startup activity is surging in Asia Pacific (APAC) – especially so in China, according to Phocuswright's State of Startups: Asia 2005 – 2013 (an Asia Pacific and Global Edition publication). As the world recovers from the financial crisis, the number of startups founded and funded in Asia is accelerating. China is the country best situated for this growth because of its sheer size and its dynamic, growing cities.

"China's online travel startups are at their best when they adapt existing models to fit local market realities," says Phocuswright research analyst Maggie Rauch, "and the companies that do this well are generally those which attract the most investment activity. A great example of this is China's Qunar, which provides call center support to help small hotels process bookings, and now allows small agencies to take online bookings through a third-party platform hooked into its site."

The number of Asian startups quadrupled from 2011 to 2013, from 27 new startups to 105. More than one in four of these are based in China. And almost half of the 43 travel startups attributed to China were founded in the last three years. China also leads the way in venture capital funding, having increased six-fold since 2011, from US$83 million to US$561.6 million in 2013.

Looking ahead, travel startup activity in Asia will only continue to grow as consumer thirst for travel in the APAC region and problems that need attention increase. This, and support from investors and reported funding will make for exciting upcoming years in Asia Pacific.

Established global players have met with mixed success in Asia, as they are confronted by savvy, lean and hungry innovators with local advantages at every turn. Phocuswright's State of Startups: Asia 2005 – 2013 focuses on the key markets of China, India, Singapore, Australia/New Zealand and the rest of APAC. The publication highlights the startup activity in all major segments including air, hotel, car rental and tour operators.

Topics include:

• Size of the APAC travel market and individual country markets
• An analysis of the areas in which innovators and investors are focusing their talents and resources
• Startup activity among the major horizontals and verticals of the industry
• Companies segmented by country, commercial focus and technical area of focus

Purchase Phocuswright's State of Startups: Asia 2005 – 2013 for a detailed overview of how innovative startups are playing a growing role in the Asia Pacific region.