Scapia is offering a lot of travel rewards for its credit card users, while Utu wants to modernize tax-free shopping.
Travel Startup Funding This Week
Each week we round up travel startups that have recently received or announced funding. Please email Travel Tech Reporter Justin Dawes at [email protected] if you have funding news.
Five travel tech startups raised $63.2 million this week.
>>Scapia, which offers a credit card and software dedicated to travelers, has raised $9 million in seed funding. It was led by Matrix Partners India, with participation from Tanglin Venture Partners, Binny Bansal’s 3STATE Ventures, and angel investors including Keki Mistry.
The Bangalore-based company has been operating in stealth mode for the past year and released a co-branded Visa credit card in partnership with Federal Bank for the Indian market.
Benefits include no foreign exchange fees, unlimited domestic airport lounge access, no annual or joining fees, and 10% rewards for all purchases.
The credit card app includes a tool that enables customers to instantly redeem points for flight and hotels, bookable through the app, the company said.
Scapia was founded by Anil Goteti, former executive of Indian ecommerce company Flipkart.
Goteti said in a statement that fewer than 5% of Indians have credit cards, and the country is projected to have 200 million credit cards in circulation by 2030.
“Millennials, with their considerable interest in travel, are looking for a primary card that can effectively reward them with travel benefits and perks. In addition, they want a delightful app with transparency and service that they can trust,” Goteti stated.
>>Utu has closed on a $33 million transaction that includes new funding from SC Ventures as well as funding that was adopted through an acquisition. The company did not disclose what share of the $33 million is new funding.
Singapore-based Utu is an app meant to give travelers higher tax refunds on tax-free shopping.
Some countries offer the ability for visitors to get a refund of value-added tax (VAT) when making purchases there. Traditionally, the refund comes in the form of a direct deposit or check after submitting paperwork and fulfilling requirements.
Utu users can have their refunds sent to a card issued by Utu instead. The company said that users can receive a refund value of up to 30% more when they purchase from one of the company’s airline or hotel partners, and they can gain up to 40% more value by opting for airline miles or hotel points over cash refunds. The company can also immediately issue store vouchers of up to 120% of the sales tax paid during overseas shopping.
Partners include Accor, Air France-KLM, Emirates, Etihad, Qatar Airways, and Singapore Airlines.
The rollover capital in the $33 million deal comes from the acquisition of Singapore-based CardsPal, a platform focused on local rewards promotions, for an undisclosed price.
Utu said it plans to incorporate CardsPal’s mobile-first technology and add its staff to the larger company.
Utu plans to expand into around 50 countries that offer tax-free shopping, including Italy, Thailand, and the UAE.
The Tel Aviv-based company said it uses AI to analyze a variety of factors determining price, meant to help travel sellers increase conversion rates and profitability.
>>Lygg, a platform for booking private airplane flights, has raised $3.9 million. It was led by Superhero Capital, along with private investors and the Finnish government.
The Helsinki-based startup said it focuses on high-demand locations, particularly those that are home to corporations with travel needs, that are underserved by commercial carriers
“With a traditional regional carrier, you’re up before dawn and home well after dinner. It’s not uncommon for people to travel ten hours or more door-to-door just for a meeting,” said Roope Kekalainen, co-founder and CEO of Lygg, in a statement. “Post-pandemic, corporations are not in a position to require such arduous travel schedules from their employees. With Lygg, our corporate clients are cutting these travel times in half, saving money, and making these requested business trips more enjoyable and productive.”
The company plans to expand further into Europe and strengthen its platform with booking tools used by travel management companies.
>>Bluj Aero has raised $2.3 million in seed funding to develop a hybrid vertical take-off and landing aircraft for regional travel.
The funding round was led by Endiya Partners and Ideaspring Capital, with participation from Rainmatter Foundation.
The India-based startup said the aircraft will be powered by hydrogen fuel cell technology.
|Scapia||Seed||Matrix Partners Indi||$9 million|
|Utu||Unspecified||SC Ventures||$33 million|
|Wenrix||Series B||Insight Partners||$15 million|
|Lygg||Unspecified||Superhero Capital||$3.9 million|
|Bluj Aero||Seed||Endiya Partners and Ideaspring Capital||$2.3 million|
Skift Cheat Sheet
Seed capital is money used to start a business, often led by angel investors and friends or family.
Series A financing is typically drawn from venture capitalists. The round aims to help a startup’s founders make sure that their product is something that customers truly want to buy.
Series B financing is mainly about venture capitalist firms helping a company grow faster. These fundraising rounds can assist in recruiting skilled workers and developing cost-effective marketing.
Series C financing is ordinarily about helping a company expand, such as through acquisitions. In addition to VCs, hedge funds, investment banks, and private equity firms often participate.
Series D, E, and, beyond These mainly mature businesses and the funding round may help a company prepare to go public or be acquired. A variety of types of private investors might participate.
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Photo credit: Scapia said its users can get 10 percent back in travel rewards for all purchases. Scapia / Scapia