Wheels Up, the private aviation start-up that counts Tom Brady and
Serena Williams as members, said Friday it completed a $128 million
round of funding that values the company $1.1 billion.
The funding
marks an escalation in the air war between private aviation players to
become leaders in a new era of consolidation and technological change
that is remaking the industry. New digital-booking apps and scheduling
programs have made booking a private plane cheaper and easier than ever.
Industry giants like VistaJet, Directional Aviation and now Wheels Up
are vying to become the dominant players and attract a broader customer
base of affluent flyers.
Wheels
Up’s Class D equity capital raise included Franklin Templeton, which
co-led the round with funds and accounts advised by T. Rowe Price and
Fidelity Management & Research, along with other investors.
Wheels Up founder and CEO Kenny Dichter said the funding will be used
for acquisitions, investments in sales and marketing and building the
company’s technology platform.
Wheels Up recently bought Travel
Management Company, which operates a fleet of light jets to complement
Wheels Up’s existing fleet of King Air turboprops, Citation midsize jets
and Citation X super-midsize aircraft.
Dichter said future
investments will be “asset light” — meaning less focused on buying
planes and more focused on expanding its digital platform to make it
easier for anyone to book a flight whenever and wherever they want.
“Three years from now, we want to be the Airbnb, the Open Table, the
Hotel Tonight of the private aviation space,” Dichter said.
Wheels
Up has attracted more than 6,000 members, with its marketing focused
heavily on sports star members and brand ambassadors like Williams and
Brady as well as professional golfer Rickie Fowler and Houston Texans
defensive end J.J. Watt.
Dichter said that with the industry poised for a shakeout, there will be a smaller group of ultimate winners.
“We see the digitization and the digital marketplace as a winner-take-most opportunity,” he said.
Source. CNBC, August 9, 2019, Robert Frank
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