Travel startup Travello has just wrapped up its biggest funding round yet raising a whopping $10 million.
Raised during a series B round led by Queensland Investment Corporation (QIC) and with further investment coming from Paspalis Innovation Investment Fund, the company plans to use the funds to cement its position in Australia as a leading tour and travel experiences brand for millennials.
Specifically, Travello will use the funds to scope out new acquisitions and expand into new regions and categories, like outbound multi-day tours.
Since travel re-opened, Travello’s revenue has increased seven times its pre-COVID level, driven by strong demand for domestic travel experiences.
Now, the company is seeing signs of a strong return of inbound international travellers with bookings from over 60 countries in September.
Despite being relatively young, the travel experiences market presents the biggest opportunity in travel right now and is expected to see significant growth in the near and long term, according to Ryan Hanly, Travello’s co-founder and CEO.
“It’s a really immature market and that’s what presents such a great opportunity. For context, around 75 per cent of flights and accommodation are booked online, but only 25 per cent of tours and activities. That’s a very exciting growth opportunity,” Hanly said.
“One of our biggest competitors is the pamphlet wall in the lobby of a hotel, so Travello’s digital-first play uniquely positions us to capture the growth potential this market offers.
“We are currently growing at 25 per cent monthly and have recorded over 1000 per cent growth in bookings.
“Many youth travel brands, including the iconic STA and Student Flights, did not survive covid, so the lack of competitors presents a unique opportunity for Travello to capture market share.
Despite only accounting for 25 per cent of visitor arrivals in 2019, the youth travel market is particularly lucrative for Australian tourism, contributing 40 per cent of spend and spending big on experiences once they reached their destination.
Paspalis CEO Harley Paroulakis said the company’s investment in Travello was part of the company’s entry into the global online “experiences vertical” which he believes Travello can dominate in the coming years ahead.
“They’re a great team with a fast-growing track record,” Paroulakis said.
In November last year, Travello acquired Australia and New Zealand’s largest youth OTA, Backpacker Deals, making it the largest experience-based OTA focused on the youth market.
In its last round of funding, Travello raised more than $6.5 million in an oversubscribed series A funding round powered by an Aussie travel and business A-list, including Flight Centre co-founder Jim Goldburg, former Tourism Australia chief Andrew McEvoy and ex-Velocity boss Phil Gunter.
