Research Insights Understand the startup landscape with these 10 findings

Understand the startup landscape with these 10 findings

December 2021
Phocuswright Research

Overall, global travel industry gross bookings declined 61% year-over-year in 2020. Digital travel startups which are often at the cusp of fundraising, corporate incubation, and/or customer acquisition were impacted as well.

In Phocuswright's latest travel research analysis State of Travel Startups 2021, Phocuswright assessed 3,080 travel startups founded since 2010, including their funding trends, verticals (product segments) and horizontals (business models/technologies).

Phocuswright Chart: Understand the startup landscape with these 10 findings
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Here are the 10 most noteworthy trends from the report:

  • The Big Picture: 3,080 travel startups founded and US$31.9B raised since 2010.
  • The number of travel startups founded has steadily declined since 2016.
  • Annual funding peaked at $8 billion in 2019.
  • Led by the U.S., North America tops global share of startups.
  • At the country level, U.S. and China are home to the largest number of travel startups.
  • There's been more overall funding for Asia Pacific startups but the tide is shifting back to the U.S. and Europe.
  • Acquisitions slowed during the pandemic.
  • The road to acquisition often takes five to 10 years (if not longer).
  • It's a SPAC-tacular period for travel startups.
  • Investors backed more transactional startups than other business models; funding to payments, SaaS/PaaS horizontals is on the rise.

Phocuswright's latest analysis of the State of Travel Startups 2021 reveals unique trends, problems and solutions that new entrants face in today's industry. The story of funding, acquisitions, favored verticals and founding geographies portray an evolving industry that companies of all segments and stages should pay attention to.

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