EDITOR'S COMMENT
• It's been a roller coaster 18 months for Inspirato but the company's $25 million funding injection from Capital One Ventures is a significant boost to a business that has seen its stock price plummet since a SPAC merger last year.
The private travel club closed its business combination with Thayer Ventures Acquisition Corporation and began trading on the Nasdaq last February, securing more than $100 million in net proceeds and reaching a valuation of $1.1 billion in the process. Since then though, its share price has nosedived from a high of $3.60 to a current figure of $0.073.
On top of that, Inspirato has announced two extensive rounds of job cuts this year, as part of what was called a "right-sizing" of the business.The company also reported a net loss of $47 million in the second quarter of 2023, taking into account a $30 million non-cash asset impairment, compared to a $5 million net loss in the comparable 2022 period.
While there has been a global slowdown in funding activity in travel this year due to inflation concerns and economic challenges, investors are showing that they are prepared to deploy capital strategically - e.g. in unique, luxury travel experiences - as consumers veer away from spending on material possessions. A portion of the latest funding looks set to be allocated to growing Inspirato's subscription-based model, seeing as Inspirato Club subscriptions have increased by one per cent but Pass subscriptions [requiring members to pay monthly fees] have decreased by 18 per cent YoY.
The resurgence of experiences appears to be a wider trend across the travel and hospitality landscape, with Airbnb set to relaunch its Experiences offering in the coming months and fellow online travel company TripAdvisor revealing that Viator, its tours and activities booking platform, made up almost half of the company's total revenue in Q2.
Capital One is certainly one to watch in the year ahead, with its venture capital arm having previously invested in Hopper and AvantStay.
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