Are subscription airline services such as those from Surf Air, Rise and the soon-to-be-launched Beacon ripe for consolidation given the close ties among co-founders? OK, we're kidding. First we'll have to see if there is even a market for the membership model in aviation.
Surf Air’s former CEO, who was edged out a year ago, is launching a rival subscription-based airline service, Beacon, on the East Coast.
Wade Eyerly will reprise his CEO role, this time at Beacon, which hopes to start a subscription-based airline service between New York and Boston, as well as vacation-destinations Nantucket and the Hamptons, beginning this summer.
Unlike members-only Surf Air, which operates Pilatus PC-12 turboprops on the West Coast and was founded in 2011, Beacon intends to license Pilatus PC-12s and King Air 350s from operating partners.
“The customer-facing portion of the business is very similar, but the operating model is very different,” Eyerly says. “Beacon will not own or operate aircraft, but rather it will select partners among the best charter operators in the country and work with them to provide the flights, allowing Beacon to focus on the experience and making sure that customers feel the refined simplicity that comes with system that allows you to simply drive up to an airport, meet a concierge and board a plane.”
On the other hand, any company that relies on partnering with charter operators will have less control of the passenger experience.
The startup East Coast air service, Beacon, states that membership will start at $2,000 per month for scheduled service, which will include concierges at private air terminals.
As part of today’s launch announcement, Beacon picked up an endorsement from Danny Ainge the Boston Celtics’ president of basketball operations.
Eyerly is co-founding Beacon with Surf Air co-founders Cory Cozzens and Reed Farnsworth, and Ryan Morley, formerly senior vice president at Buxton. Several of them, including Eyerly, are Surf Air shareholders.
Beacon says it closed its first funding round, led by Romulus Capital, last year, although Beacon declined to say how much it raised.
Everly left Surf Air a year ago when it brought in new CEO Jeff Potter, former CEO of Exclusive Resorts, and senior vice president of operations Jim Sullivan, previously vice president of operations for Frontier Airlines, amidst complaints about severely over-booked planes and other service woes.
In the interim, Surf Air has expanded in California and plans on bringing service to new markets, including Texas, Florida and the Northeast.
“We recognize that we’ll have competition in those markets because this is a model that has shown great success and we are in full support of that because we believe competition makes you smarter and more efficient,” Potter says. “Surf Air has evolved with our product in the last year, so we believe we will, in most cases, have first to market advantages as well as additional advantages born from the experience of expansion and growth.”
If Surf Air indeed expands into the Northeast then that will pit Eyerly against his former airline.
“A McDonald’s in Tallahassee is hardly in competition with a Burger King in Detroit,” Eyerly says of the competition. “The same holds true here. While delivering similar customer experience at similar price points the founders of Beacon are almost all stock holders in Surf Air and eager to see them do well. There’s plenty of room for both companies to succeed.”
Everly also is a shareholder in Rise, a subscription airline in Dallas.
Photo credit: A Pilatus PC 12 aircraft. Wikimedia Commons