Munich Startup: When we last spoke in 2017, you said that Flyla needed to get a handle on high demand. Were you able to achieve that goal?
Ben Shaw, CEO at Flyla: Back then, to manage demand, we built a student travel portal: many partners for a comprehensive offering. That’s how we quickly got to our first 12,000 users, to whom we offered flight and hotel deals.
Flyla: Waking up from the coronavirus hibernation
Munich Startup: And then Corona came. What obstacles did you face – aside from the pandemic?
Ben Shaw: In the early phase of Corona, nobody knew how long the crisis would last. We struggled with many refunds, but at the same time we had reached a booking peak. Putting Flyla into hibernation was therefore necessary. But it was actually hard for us to do.
At the beginning of last year, we relaunched Flyla: first with a new team. Then with new partnerships, a new booking process, and finally with new approaches to marketing. All of that took time.
Added value for customers and airlines
Munich Startup: How has your solution evolved?
Ben Shaw: The travel market is certainly characterized by a lot of competition. Nevertheless, there are some niches that suffer from a lack of transparency and where incredible value can be created for customers.
One of these niches is student flights. Many students are not aware that a large portion of airlines – over 70 percent in Europe – already have student programs. Often these date back to when airlines conducted travel agency-specific marketing and offered special rates to travel agencies located near universities to attract students.
But because only a few airlines have dealt with this topic for a long time now, most of these rates are not particularly attractive or competitive. There are even isolated cases where the student rate is more expensive than the standard price.
Our approach is therefore different. In the meantime, we have integrated almost every airline that offers student rates on Flyla.com (for example Lufthansa, Turkish Airlines, or KLM). And we even go a step further and enable airlines to consider this target group for what is known as load factor optimization. That means instead of offering just a 2 percent discount on every seat, airlines can offer cheap seats to students on routes that often remain emptier, shortly before departure. The standard price can still increase and generate profits for airlines. This way, fewer seats remain empty and students are enabled, within their means, to fill the otherwise empty seats.
In addition to Eurowings, we are now using this exact model together with Norwegian, SAS, and ITA to meet the demand for cheap flights among students.
Higher margins through CO2 compensation
Munich Startup: And how are things looking financially for you?
Ben Shaw: It is not unusual for an online travel portal for flight sales to earn only a few cents. The fact that our added value extends beyond flight sales to other travel partners – with embedded student authentication and automatic CO2 compensation – allows us, in contrast, a significantly higher take rate. We benefit from the particularly good environment in the travel industry and the desire of many to take time out. Especially now that travel is possible again.
Munich Startup: What learnings have you taken away so far as a founding team?
Ben Shaw: The last few months have come with incredibly many new learnings:
- Our new design was well received,
- Integration of additional payment options including PayPal has led to further customer growth,
- our social media strategy now accounts for a third of our growth,
- because CO2 is automatically compensated with us, many of our customers are not deterred from booking domestic flights either, which are not only up to 80 percent cheaper than the standard price, but also more comfortable and especially faster than train travel.
Flyla: “Munich has helped us incredibly”
Munich Startup: What role did the Munich ecosystem play in your journey so far?
Ben Shaw: Munich has helped us incredibly. We are affiliated with the Vitolus Group, which after successfully helping combat the pandemic with its testing and vaccination services is now advancing other health topics such as outpatient care and the procurement of medical consumables. Our office on Schwanthalerstraße has become a hotspot for new ideas and startup meetings – including with the team from Lotaro. And of course our networks, emanating from LMU and TUM, have actively supported us.
Munich Startup: What milestones are you working toward next?
Ben Shaw: We have expanded our supply side. There are as many affordable student tickets on offer as ever before. Now it’s about continuing to expand the business, bringing on more partners for our model, and making the student flight market as transparent as never before.
