Air France-KLM Launches a Unit to Churn Out Travel Startups

Air France/KLM Group debuted on Wednesday a fledgling seed fund and coaching effort to help create projects that will tackle leisure and business travel problems and possibly spawn tomorrow’s superstar businesses.

BigBlank, the group’s new subsidiary, plans to start projects with entrepreneurs and help those projects morph into startups. It will provide seed fundings of up to $900,000 (€800,000) a project.

Many other airlines — including Aeromexico, El Al, Emirates, Etihad, JetBlue, Lufthansa, and Virgin Atlantic — have attempted to mix it up with entrepreneurs, sometimes as marketing gimmicks to make their brands cooler, sometimes to make a financial bet that may pay off down the line, and sometimes to spot new ideas to strategically seize on before their rivals do.

BigBlank CEO Hubert Riondel eschewed the label “accelerator” for the Air France/KLM program, partly because his organization doesn’t host startups and doesn’t invest in startups that already have customers.

BigBlank is instead “a startup studio,” Riondel said. A team of a dozen hacker-savants based in a co-working space in Paris’s 10th arrondissement will identify pain points at every step of the typical travel journey and then incubate projects to solve those problems.

The team will choose projects to turn into startups with the help of a network of mentoring engineers and marketers, evaluating ideas based on their potential revenue offered regarding market size and barriers to entry for new players to thrive.

So far, so methodical. However, supporting startups isn’t always easy. Last month, Qantas ended its two-year effort at identifying startups to support via its Avro accelerator. The company didn’t provide a persuasive explanation. We have to assume that finding the next Airbnb is harder than it looks.

But some airlines said they have had success with their programs. JetBlue Tech Ventures, for example, has invested in several enterprises on behalf of the U.S. carrier JetBlue and the company’s CEO Robin Hayes has said the effort has helped improve JetBlue’s business savvy. For example, it recently adopted a customer service tool from a startup it had invested in.

BigBlank is not Air France/KLM’s first effort to rub shoulders with aspiring entrepreneurs. In 2017, it held a startup pitch competition at the Viva Technology trade fair. The airline group has also supported in Welcome City Lab, a Parisian incubator devoted to fostering tourism businesses.

The subsidiary plans to launch its first startup by early spring.