A venture studio shut down its remote working startup after discovering its business model wasn’t really meeting its goals.
Purple Elephant Ventures, based in Nairobi, Kenya, has pulled the plug on Wavel, a platform designed to connect professionals with high-end properties. The decision came just after Purple Elephant Ventures had raised $1 million, including backing from Ian McCaig, a former lastminute.com CEO.
It had set up Wavel to showcase African destinations as ideal remote working locations.
Nomads Need Not Apply
While brands like Selina have welcomed growing numbers of digital nomads, Wavel was more for high-end professionals, such as in banking or law, perhaps with their family.
“The premise was it was a remote working startup,” said Purple Elephant Ventures’ co-founder and CEO Ben Peterson. “Why work from your house in London when you can work from one of the world’s most inspiring locations? Like in Kenya, you can work from the Masai Mara, or from the coast.”
Infrastructure proved a challenge, though, with guaranteed wifi and home office space essential. That meant some control over the property was needed.
“If we’re controlling these properties, then we become what? We rent them out, we kit them out, we then essentially become a property manager, who’s then responsible for maximizing occupancy,” Peterson said. “But if we’re maximizing occupancy, then it means renting to people who might want to do remote work, but other people probably don’t.”
The other obstacle was brand value. The co-founder said if a family were relocating to Africa, they’d need to be able to trust the brand. For example, if the internet goes down they need a brand they can rely on, so they know they could make that important board meeting.
“And if you’re working on the coast of Kenya, or in the middle of the bush, where you wouldn’t naturally expect to have great internet, you’d want a brand to help you guide you through that, and the installation of the technology and hardware to make your remote experience as smooth as possible,” he said.
Developing a brand takes time. So was the solution rather to focus on a front-end sales engine? Even Airbnb came under some criticism for its suitability for digital nomads. Can you trust a host?
Meanwhile, Peterson said he also felt the demand for remote work has begun to waver. “Blended travel seems less blurry, and more distinct: this is work, this vacation, let’s keep them separate,” he said.
As a result of so many directions to take, Peterson said Wavel “fell into the wasteland of not being able to land on the proper business model.”
However, he believes it was the right decision as it avoids losing money in the future. The tough call also reflected the “venture studio” ethos, which involves coming up with the ideas, developing them, and then testing them.
The studio’s goal is to build three or four startups a year, and work is continuing on other startups, including Kijani Supplies.
“Most hotels buy their supplies from dozen of places, and drive around,” Peterson said. “We’re building a green supply chain business. Eventually it will be fully carbon neutral , electric trucks, and motorcycles to last-mile destinations.” All qualities that movie star and environmental activist Ed Norton will no doubt approve of, as he prepares to open his own eco-lodge in Kenya.
Africa is also ripe for further investment. The continent will begin to open up its air transport network over the coming years, and as a highly fragmented sector, Peterson aims to make his mark.
“It’s relatively early in the journey, but we see massive potential in dozens, hopefully, of startups, each of which will be aimed to address major problems in Africa’s tourism industry.”
Conference moderators aren’t usually supposed to laugh at the people they interview, but Accor’s chief Sebastien Bazin took CNN’s Richard Quest to task this week.
Bazin was on stage at the World Travel and Tourism Council Global Summit, held in Saudi Arabia, discussing the rise in blended travel. Wellness was becoming a fast emerging trend, he argued, with travelers slowing down and having longer lunches.
“You’re laughing,” the Accor CEO told Quest.
“I’ll tell you why I’m laughing,” he replied. “I don’t think anybody on this panel recognizes that in their everyday life … the number of people I’ve spoken to in this room who say they’ve been to 15 destinations in the last three weeks, and multiple time zones, and they haven’t stopped.”
With the sudden rebound in travel, and conferences returning en masse, there’s an argument to be made here that perhaps business travel is simply picking up where it left off in 2019. Airlines struggling to keep up with demand is an indicator of this.
But the cause of this might be too early to determine.
Is this a rush to travel as much as possible, while it’s still possible, before future Covid outbreaks? Is this still pent-up demand being released?
Or is the human memory wired in such a way that it may not be possible to change habits, despite travel bosses proclaiming the future will be more mindful, slower and focused on wellness?
10-Second Corporate Travel Catch-Up
Who and what Skift has covered over the past week: American Express Global Business Travel, Delta Air Lines, energy migrants, Edition Hotels, European Union ID checks, Four Seasons, Hyatt, Kenya Airways, KLM, Saudi Arabia, Sonder, Yatra.
Amadeus Critiques Pace of Travel Booking Transformation
Booking travel and managing expenses is becoming more digital, but there’s still work to do. That’s according to Amadeus Cytric Solutions, which has polled companies for their views as travel rebounds.
While there’s been progress in the drive toward automation, with 80 percent of global respondents stating travel and expense is more digitized compared to other processes, there are still “manual and fragmented processes” for areas like compliance and security.
Some 34 percent cited managing compliance for travel, like visas and work permits, as well as privacy and security concerns, at 31 percent, as a main challenge. And 30 percent said manual processes put a strain on employees’ productivity. On average only 37 percent of enterprise software systems integrate with the organization’s travel and expense platform, leading to “sub-optimal performance and poor employee experience,” Amadeus said.
The Madrid-based tech company argues transformation will help employee experience and achieve corporate goals next year. “As the world of work recalibrates for a hybrid future, processes, technologies and culture need to be updated to drive increased engagement and facilitate better collaboration among employees when planning travel,” said Rudy Daniello, executive vice president, Amadeus Cytric Solutions.
The findings are based on a survey of 525 decision-makers involved in travel and expense management for large corporations, across nine markets and five in-depth interviews. Each of the 525 senior decision-makers questioned represents a corporation with revenue ranging from $100 million to $5 billion. The survey was carried out by Forrester Consulting between July and August.