Small Players in Travel Tech: Successes Amid M&A
In recent years, there has been a noticeable increase in acquisitions and mergers in the travel tech sectors. This trend affects not only large companies, but also smaller players in travel tech, who are now, more than ever, finding their niche thanks to the support of private equity (PE) funds. Given the growing interest in this area, small companies are becoming key players in the market, demonstrating incredible flexibility and innovation.
Growing interest from investors
Investment in small companies in travel technology has increased significantly. According to the source, travel tech deal volume reached $20 billion in 2022, up $25% year-on-year. The most notable increase in deals has been from private equity firms backing small companies. This is supported by the following factors:
- Increasing demand for digital travel solutions.
- Flexibility of activities of small companies.
- Ability to quickly adapt to market changes.
The benefits of small players in travel tech
Small players in travel tech have a number of competitive advantages that make them particularly attractive to investors:
- Innovative technologies: Many startups are developing unique solutions that address current consumer needs, such as mobile app development or a booking platform.
- Specialization: Small companies often focus on highly specialized niches, which allows them to stand out from their larger competitors.
- Flexibility: Smaller structures are more adaptable to changes in demand and are ready to quickly implement new ideas.
Examples of successful small players
Several small players have demonstrated examples of successful development through M&A:
- Airbnb: Despite its fame, Airbnb started out as a small startup and has raised a lot of investment, which has enabled its growth into a global company.
- Tandem: The company, which offers unique experiential tours, has attracted the attention of major investors, allowing it to expand its geography and improve its service offering.
Trends and the Future of Small Players
The shift in focus towards technology and sustainability in travel is shaping the future of small players in travel tech. According to analysts from a leading source, more than 60% of new investment in travel tech is going to startups. Given these trends, small players in travel tech will certainly continue to be important players in the market.
The support of private equity funds helps stabilize and grow these companies, which in turn leads to the creation of innovative solutions for the travel market. Given current trends, small players in travel tech continue to be viable and interesting for investors.
