This investment carries considerable risks and may lead to a loss of the entire assets invested. Projected returns cannot be guaranteed and may be lower than expected.
Named "Best Start-up of 2015" by the EU, TripRebel enables travelers to book hotels while benefiting from reduced room rates later. Intelligent algorithms check the initial booking every day, and if the hotel lowers the room rate later, TripRebel pays back the full price difference or provides users with free upgrades.
The use of information technology has changed the hotel industry completely over the last few years. Today, hotels use modern systems that constantly optimize room rates, occupancy, and profitability. Analyses have shown that 8 out of 10 hotels change their room rates multiple times within the last 30 days before a guest arrives. Consequently, it is becoming increasingly difficult for travelers to choose a suitable hotel for a good price.
As the search for hotel rooms has become more difficult, travelers have changed their behavior accordingly. According to a study by GfK in collaboration with Google, travelers in Germany spend an average 24 days online before they make their final decision on a specific hotel offer. Nonetheless, approx. 80 % of travelers ultimately pay too much for their hotel room.
Portals like Trivago have been unable to solve this problem. Indeed, they show only the best price available at the time of the search. TripRebel, on the other hand, monitors the market and the changing rates. If the room rate decreases after booking, TripRebel automatically cancels the previous booking and books the new offer. As a result, TripRebel provides users with ten times the saving of conventional price comparison portals.
This innovation has helped TripRebel raise awareness around the globe. TripRebel has been selected as the "start-up of the week" by The Wall Street Journal, and The New York Times called the beta version of TripRebel one of the "hottest travel saving tips" in 2014. In mid-2015, we received our most important award when the European Commission named us the "Best Start-up of 2015." In addition, TripRebel has already attracted strategic partners such as ProSiebenSat.1 Accelerator and experienced angel investors.
Still, TripRebel has not only received awards, but also seen a remarkable business development. In fact, revenue from booking has increased by 147 % per quarter since our official launch in Q4 2014. The number of monthly visitors increased even more sharply in the same period and has now reached 10,000.
We will keep boosting this growth in 2016. TripRebel has been selected from more than 300 start-ups that applied for the ProSiebenSat.1 Accelerator program. In other words, TripRebel has not only attracted a powerful strategic partner, but also has a media budget of €500,000 at its disposal now. Consequently, TripRebel will reach millions of people in Germany through its first TV campaign in Q1 2016.
But German travelers are not the only ones interested in TripRebel. Since our website's launch, foreign visitors – especially those from the U.S. – have accounted for 53 % of all website traffic. This proves that TripRebel possesses a globally scalable product.
Hotels may also benefit from our platform in the future. By scaling up our business, we are also helping hotels handle demand more efficiently. When hotels have free rooms, they may offer these rooms to our customers in the form of upgrades. Only select customers may see the reduced room rate then. In this way, hotels can avoid a negative impact on the market price.
TripRebel is collaborating with one of the world's largest hotel providers. At the moment, as many as 200,000 hotels worldwide are available through our portal. Through the integration of these hotels, we can offer customers a very good selection of hotels at competitive rates. We plan to integrate additional providers in mid-2016, thus increasing our inventory to 500,000 hotels.
Whenever a traveler books a hotel room through TripRebel, we simultaneously make a reservation that may be canceled free of charge.
At that point, optimization begins. Until the day the traveler arrives at the hotel, our search algorithm checks the current room rates on a daily basis. In case the algorithm discovers better offers on the market, it first checks whether there is any advantage in canceling the initial booking. If that is the case, the system first books the better rate, then cancels the previous booking. This process ensures that travelers have a valid booking in our system at all times.
We pay out the total price difference to the traveler or email this person about additional hotel upgrades. Travelers may also choose to donate part of the price difference to Welthungerhilfe (a German charity fighting hunger and poverty worldwide) for reconstruction after the 2015 Nepal earthquake.
Moreover, our customers may save several suitable hotels in a list of favorites based on their individual needs and budget. If they book one of these hotels, TripRebel will use all similar hotels as additional options for the customer.
As soon as one of the similar hotels lowers its rates, TripRebel emails the traveler. If the traveler likes the new offer, he or she may book it with a single click. This confirmation process is necessary only if the traveler wishes to switch to another hotel.
When users create lists of their favorite hotels, they increase their chance of getting a lower rate. In fact, if users select one hotel, they have a 31 % chance of getting a rate that is 16 % lower on average. If, however, users select as many as five hotels, this chance increases to over 86 %, and the rate will be approx. 20 % lower than the initial rate.
The hotel inventory and the offers on the TripRebel website are based on agreements between TripRebel and major international hotel providers. Consequently, TripRebel is not affiliated with individual hotels or hotel chains at the moment.
Our business model is simple. For each hotel room booked, we receive a commission of 5 to 15 % from the hotel provider. This commission is always based on the final room rate, which is currently €395 on average.
Normally, hotel providers pay out the commission to TripRebel once the guests have left the hotel. TripRebel does not receive a commission on canceled bookings.
Unlike conventional price comparison portals, our system makes the hotel market transparent for an extended period, not just at the time of booking.
The facts speak for themselves: Whereas conventional portals help customers save as little as 1.8 % at the time of booking, TripRebel helps customers save up to 20 % until the day they arrive at a hotel.
In addition, the option of constantly monitoring various hotels for reduced room rates is globally unique.
Within such a large and competitive market, profitable customer acquisition is essential to the successful growth of a business. In this context, two KPIs are particularly important: CPA (cost per acquisition), that is, the investment necessary to motivate a customer to make the first purchase, and CLV (customer lifetime value), that is, the revenue TripRebel generates through each customer.
While focusing on these two KPIs, we work on increasing the number of TripRebel customers through PR, social media activities, advertorials, display ads, and partnerships. Optimization of these channels has helped the two KPIs (CPA and CLV) develop extremely positively.
Ever since we introduced our first marketing campaigns in Q2 2015, the CPA has decreased by 10 %. Moreover, the average invoice amount has increased from €180 to €395. High customer satisfaction rates, measured through the industry standard of NPS (net promoter score), have increased the rate of returning customers to 32 %, thus also causing the CLV to increase.
Our key target group consists of "young professionals" that frequently plan trips to cities like London, Dubai, or New York, where the market is perfectly suitable for our service because there are many hotels and a dynamic market with significant price fluctuation.
As people in this target group have permanent jobs, they need to plan their trips in advance. They are also well educated, have a high household income, and no kids. For these reasons, members of our target group travel frequently and prefer 3-star to 4-star hotels.
Our marketing activities focus primarily on Germany, but our concept works around the globe.
The global hotel industry has a volume of €709 billion, €177 billion of which can be attributed to our three key markets (the U.S., the UK, and Germany). Of these €177 billion, €30 billion can be attributed to online bookings made via hotel booking platforms and price comparison portals like TripRebel.
The online hotel booking market provides excellent opportunities for growth. According to Google, more than 50 % of hotel bookings in Germany still take place offline. This is one of the reasons why markets in countries like Germany are experiencing growth in the two-digit range.
So far, we have achieved the following things:
- Created a booking portal with 200,000 available hotels
- Reached a booking volume of €206,000 in the period from Q1 through Q3 2015
- Achieved a 147 % increase in the booking volume per quarter
- Increased the average invoice amount from €180 (Q4 2014) to €395 (Q3 2015)
- Reached higher customer satisfaction rates (measured through the industry standard of NPS, i.e., the net promotor score). Indeed, TripRebel has reached a score of 57 (whereas Apple has reached 62, TripAdvisor has reached 29, and Booking.com has reached 25).
- Motivated 32 % of customers to return
- Reached 14,000 Facebook fans
- Joined the networks of two leading start-up accelerator programs (Startupbootcamp & ProSiebenSat.1 Accelerator)
Our next milestones will be:
- A TV campaign on stations run by ProSiebenSat.1 group
- The growth of our business to a booking volume of €9 million in 2016
- The development of two additional marketing channels (Google & Affiliates)
- Our further international expansion (to the UK and the U.S.)
- The improvement of our search algorithms
- The full integration of 2-3 additional hotel providers
- The hiring of five additional team members
We plan to use the capital raised on Companisto primarily to raise awareness of TripRebel. Moreover, we want to keep investing in our core technology, the room rate monitoring system. Finally, we need to expand our customer service team to retain our high customer satisfaction rates even in times of rapid growth.
Investment level 1: €100,000.00 or more
If we reach this level, we plan to invest primarily in marketing.
In other words, we will develop another marketing channel in order to foster further growth. Initially, Google advertising will most likely be the right choice for this purpose because it will supplement our planned and completely financed TV campaign.
Investment level 2: €400,000.00 or more
If we reach this level, we will also invest in raising awareness of TripRebel. Apart from Google advertising, we will also focus on a second marketing channel: affiliate networks. We will hire new team members both in the department mentioned above and in the development and customer support departments. The new developer will focus solely on improving our search algorithm, whereas the new customer support employee will help us handle the increased number of customer requests.
Investment level 3: €700,000.00
Investments in marketing will remain our main focus. In addition to developing the marketing channels listed above, we will also invest in the continuation of our TV campaign. For this purpose, we will need two additional team members. Indeed, another developer will focus on improving the booking portal (our front end), whereas another customer support employee will support the team.
TripRebel has already attracted strategic investors and successful international angel investors:
Startupbootcamp, one of the leading start-up accelerators in Europe, invested in TripRebel when we participated in its 2014 accelerator program in Amsterdam. Startupbootcamp possesses a large network of mentors, investors, and partners and advises TripRebel on all matters concerning business development.
Furthermore, Julian Hönig (a designer at Apple in California), Lutz Bethge (the former MontBlanc CEO), and two other international angel investors from the Startupbootcamp network have invested in TripRebel.
Recently, we have also attracted ProSiebenSat.1 Accelerator as a strategic investor. While TripRebel is participating in the ProSiebenSat.1 Accelerator program, ProSiebenSat.1 will provide us with the knowledge necessary to scale up B2C business models.
Carlos Borges (co-founder & CEO), born in 1981, grew up in Brazil and loves to spend time in the world's most beautiful spots. This passion also led him to get a bachelor's degree in business with a special focus on tourism in Brazil. After completing his MBA in international marketing at ESB Business School in Reutlingen, Germany, Carlos worked for the marketing team of Colgate-Palmolive. Today, he is TripRebel's CEO and supervises the company's operations and finances.
Dr. Gernot Supp (co-founder & chief scientist) was born in 1976 and became interested in the mysteries of human life at a very early age. He studied biology at the University of Graz and received his doctorate in neuroscience. He has worked for Max-Planck-Institut Leipzig among other things. A neuroscientist, he is used to analyzing billions of datasets and to conducting time series analyses. At TripRebel he uses this technology and his passion for traveling to analyze hotel rates. Our chief science officer, he is responsible for data analysis and for the development of our algorithms, which enable us to provide our customers with the best room rates available.
Pepijn Schoen (tech lead) has a master's degree in computer science and more than five years of professional experience. He used to be the CTO in residence at Startupbootcamp Amsterdam, one of Europe's best start-up accelerator programs. Moreover, Pepijn worked with virtual reality technology and simulation systems for fusion reactors in the past.
Valentino Borghesi (creative director) studied communication & design in Milan. He grew up in his parents' print shop and possesses an incredible sense of aesthetics and functional design. In addition, Valentino was involved with many start-ups in Italy and other countries prior to joining TripRebel.
TripRebel is currently one of the most promising German start-ups and has received numerous awards.
2015:
- "Best European Start-up" award by the European Commission at Tech All Stars 2015
- Winner of SXSW Interactive 2015 in the Travel & Mobility category
- One of the 12 finalists of the Phocuswright Award
2014:
- 1st place at Startups@Reeperbahn during the Spiegel Online media awards, including a media budget of €100,000
- One of the three finalists of the KLM Award
- One of the ten finalists of the "Startup of the year 2014" award by Deutsche Start-ups
- Alumnus of Startupbootcamp Amsterdam accelerator program. This program helps early-stage start-ups define their market positioning, develop their products, and complete their first financing round.
- Participant of the ProSiebenSat.1 Accelerator program. This accelerator program helps well-established B2C start-ups scale up their business through TV advertising.
- Grant worth €100,000 by IFB (a public-sector development bank in Hamburg) for the development of innovative technology
- Member of the board of partners at TU Graz Know-Center, a center of excellence for the development of big-data technologies in collaboration with private-sector companies. This board also includes members like Siemens, Infineon, APA, and Hyperwave.
Product Improvement
Creating a booking portal that works in various browser types and versions and looks great both on desktop computers, tablets, and other mobile devices is a huge challenge. Therefore, we are thankful for any information about potential problems or incorrectly displayed data. In such cases, please make sure to also provide us with the browser type, version, and device so that we can find a solution as soon as possible.
Headhunting
To keep growing and expanding our business, to boost its internationalization, and to improve our technology, we will invest in the future development of our team. Consequently, we will be thankful if you introduce us to any suitable candidates. For an overview of job openings, please see here.
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