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WhatThe travel startup space is stronger than ever: A whopping $5.7 billion — a record-breaking figure — went to these companies last year, according to Phocuswright’s State of Startups Report. (Note: Phocuswright is owned by Northstar Travel Group, the parent company of TravelAge West).
Why It MattersPhocuswright has been tracking this number since 2009. In the past decade, nearly $20 billion has been pumped into industry startups, with last year’s record accounting for about one-third of all funding for the last 10 years. It’s a strong vote of confidence for the industry’s new businesses and the sharing of new ideas and technologies.
Fast Facts- Last year represented a 55% year-over-year increase in the amount of funding for these startups.
- Phocuswire, a sister brand to Phocuswright, points to the global online travel outlook and “frenzied late-stage investor support for new business models” as a primary reason for the funding boom.
- Most of the funding ($4.5 billion) raised last year was obtained by late-stage startups. Early-stage businesses, on the other hand, declined from $218 million (2016) to $116 million (2018).
- The total number of founding rounds is declining; 570 signed in 2016, while 375 signed in both 2017 and 2018.
- Packaging was the fastest-growing sector (138% increase year-over-year), while content/social-related businesses had a 392% jump.