Guest project. Building peer to peer travel

Barcelona, December 2014
A world to discover

We aim at developing a sustainable platform
connecting travelers and local hosting businesses in
long-tail destinations
Overview
2
A sustainable
platform that
connects
travelers with
local hosts in
long-tail
destinations
Opportunities
Value
proposition
Value creation Revenue streams
• Increasing
online travel
demand and
sophistication
• Rising
importance of
innovation
• Intense
pressure among
travel
intermediaries
• Untapped long-
tail destinations
and experiences
• A low cost
service platform
to connect
travelers and
hosting
businesses in
long-tail
destinations
• Transparency is
promoted on
both sides of the
platform:
authenticity, fair
prices and
positive social
impact
• Develop a
platform with
attractive deals
for hosts and
guests
• Retain a large
customer base
• Engage a large
supply of long-
tail hosts and
places
• Benefit all with
economies of
scale
• Transaction fees
for guests
• Transaction fees
for tour agents
• Advertising for
tourism-related
companies
• Consulting for
tourism
institutions and
partners
Impact
measurement
• Profit pool creation (through scalability and revenue per transaction)
• Sustainability in brand loyalty and incentives for all parties
A world to discover

The ‘Choquequirao’
syndrome

Choquequirao, promoted in 2007 as the New Machu
Picchu, decreased by more then half the number of
visitors by 2013
A world to discover
Visits on top destinations in Peru,
2013
Thousands
1. Machu
Picchu
117
7
2. Quistococha
28
3
51.
Choquequirao
3
Average tour prices (accommodation
excluded)
Price per an 8-day package
National
operators
1100
USD
800 USD
Not
available
Not
available
Not
available
Only reviews
Restoring
archaeologic
sites
Total
budget
0.7
Touristic
infrastruc
ture
Access
infrastruc
ture
2.4
10.0
13.1
Government and private conjoint investment
for tourism in Choquequirao, 2007-13
USD MM
Tourists visiting
Choquequirao, 2007
Foreign
3200
Local
4500
Case
.. but so far
In 2007, Choquequirao, a promising destination, received investment to boost
arrivals…

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Initial idea description
6
A world to discover
A world to discover
“We are committed
with removing
every barrier that
separates guests
from hosts that find
in responsible
tourism a lifestyle
in off-the-beaten-
path destinations”
Tag Line Problem Solution

A platform that engages guests that seek
authenticity and hosts in long-tail destinations
Solution
7
Key
Partners
Key
Activitie
s
Value
Proposition
Customer
Relations
Custome
r
Segment
Key
Resourc
es
Channels
Cost Structure Revenue Streams
 Tourism
support
institutions
(government,
NGOs,
UNWTO, etc.)
 Tourism-
related
product
suppliers
(flights,
research,
software
development)
 Journalists,
travel
influencers, PR
agencies
 Small and
independent
travel agents
 Long-tail and
authentic
destination
focus
 Lean and low
cost service
platform
 Availability of
user friendly
management
capabilities
 Positive social
impact on
destinations
 Platform
mgmt.
 Marketing
and sales
 Resource &
third-party
mgmt.
 Customer
database
 Intangibles
(brand &
partnership
s)
 Talent
(technology
& tourism)
 Loyalty and
advocacy
from
travelers
 Engagement
with local
hosts: guides
and tour
operators
 Direct contact
with hosts
through
destination
managers
 Mobile access
and apps for
travel agents
and travelers
 Tourists that
seek
authenticity
and
ownership of
the trip plan
 Local guides/
caters in
long-tail
destinations
 Companies
with products
related to
tourism
industry
(devices,
insurance,
travel)
 Opex: infrastructure, content and
application management, customer
service, sales and marketing
 Capex: brand development,
infrastructure building
 Fees (transaction and consulting)
 Advertising from channels and
customer data
.. to build a self-reinforcing business
model
Large
volume
platform
Brand
developmen
t
Higher
repetition
Strong
recognitio
n
Higher
willingnes
s to pay
App
landscap
e for
guests*
Large
customer
base*
Customer
data*
Guest
value
cycle
Engagement of local
tourism institutions
App
landscape
for
destination
s
Responsible
tourism
standards and
guidelines
Supply
pooling
Lower
supply
costs*
Large
destination
base and
variety
Large local
host base
Higher
perceive
d value
by hosts
Host
retentio
n
Host
adoptio
n
* Involving small and independent travel agents as support
channels
A consistent business
canvas…
Social
medi
a
A world to discover

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Core value proposition
8
A world to discover

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Frond-end
9
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Back end
10
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Foundations
11
A world to discover

Opportunity
13
The booming travel industry in travel is dismissing
an untapped pool of resources in long-tail
destinations
Evolving
demand
Rising
innovation
Polarizing
competitio
n
Untapped
long-tail
 Overall global travel market value by 2014 is 3.1 USD Trillion, and
will rise to 3.6 USD Trillion by 2018.
 The addressable segments (travel retail, accommodation and
tourist attractions) will grow from 1.7 USD Trillion in 2014 to 2.0
Trillion in 2018
 Internet sales will grow from 30% to 35% of total travel sales,
with tourist attractions the least developed with only 4% of total
web sales
 Sophistication of demand in terms of unbundling, rich media,
immediate response, trust and flexibility
 Commoditization and consolidation of Online Travel Agencies are
driving prices down quickly, and profits. Expedia reported only
8% of EBIT on 2013
 Lack of innovation on traditional agencies poses a major issue
(TUI and Thomas Cook reported EBITs close to 0%)
 Fragmentation and lack of a clear need-driven solution on new
startups (the blind race to become the next Airbnb)
 There is not an official number of destinations, but we estimate
200K long-tail destinations , with an average of 1500 visits per
year
 High price level, and difficulty on accessing experiences with
deeper level of involvement, such as volunteering, eco-tourism,
and other that imply a richer experience of involvement with
locals
 New emerging travel business models (Mobile Travel Agencies,
Peer 2 Peer, etc.)
 Digital density and the Internet of Things will transform the
economy in every industry in the short term
 Off-line specifics new solutions are starting to proliferate with
multiple stakeholders (Destination management services, service
management innovation, local brands, innovation in
volunteering, etc.)
.. but current business models fall short
Travel industry is once again dynamic and booming with lots of white spaces and
blue oceans…
 Strong partnerships and
destination and customer
base
 Lack of affordable
bundling
 Focus only on popular
destinations
 Strong customer base
 Lack of bundling and end-
to-end solutions
 Weak presence on long-tail
destinations
 Strong in meta-search
 One of the strongest in
long-tail destinations
 Passive attitude towards
creating value in
destinations
 Strong peer to peer model
 Lack of quality oversight
 Still strongly focused on
accommodation as core
value proposition
 Strong solution
 Lack of strong customer
and destination base
 Potential big player if
revenue model is fixed
A world to discover

CEO: Orlando Franco Martinez. Nationality: Peru
Background: Orlando has a strong background in strategy and marketing. He worked for
four years in strategy and consumer insights at PepsiCo, throughout South America.
After that joined consulting at McKinsey for 2 years to work in Latin America in projects
in several countries in topics of organization, technology, customer service and
acquisitions. Currently completing his MBA at IESE.
xx
A world to discover
15
CFO: Hilda Mbabazi Kabushenga Nationality: Uganda
Background: Hilda has an extensive finance and legal background, as well as a good dose
of knowledge about social aid. Prior to her years as a tax consultant at KPMG and legal
aid at the Bank of Uganda, Hilda worked for two years with the Ubuntu School
community outreach program. She also has insight into of volunteer tourism from her
family’s business in this industry. Currently completing her MBA at IESE.
CMO: Christian Lovborg Nationality: Denmark, Australia, USA
Background: Christian has work in business development for the last four years, helping
double revenues for mid-sized US manufacturer, Metzia, through successful social media
PR and online marketing campaigns. Prior, Christian led an international marketing team
at Jacob Fleming and co-founded EUCIF, which he helped build through recession before
selling in 2009. Currently completing his MBA at IESE
Core team

Engaging the right set of stakeholders and leading
the pace will not only deliver growth but bring
value
Impact
16
.. would bring results for all parties
A long term focus on tourism
development…
A strong set of partners…
Institutions
Supporting
destinations
Involved
organizations
Local
stakeholders
Impact building blocks by 2020
USD MM
Gross
added
travel
revenues
Public
infrastructur
e
developmen
t
Total
impact
beyond
activity
Net
landspot
sales
4.700
207
485
Indirect
revenues
*
Induced
revenues
*
12.000
3.000
15.485
 Central and
local
government
 Destination
management
organizations
 Local tourism
associations
* WTTC estimates
Demand
management
Capability
building
Infrastructure
building
Sustainability
development
 Building
visibility for
long-tail
destinations
 Building trust
on potential
guests
 Enabling
connections
between hosts
and guests
 Sharing
knowledge
between
destinations
 Providing
management
and
coordination
tools
 Channeling
funds to build
basic
infrastructure
for tourism
 Developing a
strong network
of suppliers and
partners
 Developing
community
leaders among
local hosts
 Providing
awareness and
visibility on
achieving
millennium
development
goals
A world to discover

Guest project. Building peer to peer travel

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