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🏃 How Did They Get Started?

TourRadar's origin story begins with a travel mishap experienced by Travis and his brother in the early 2000s.

As Australian expats in London, they organised a group trip to Croatia through a US-based company. After a 12-hour bus journey, the trip was a complete disaster: 

• Wired $5,000 to an unknown company

• No one to meet them at the airport

• Lack of 24/7 customer support

• No chargeback capabilities

This frustrating experience highlighted the need for a more reliable, transparent booking system for group tours. 

The evolution of TourRadar’s product:

V1: Social platform: Started as a WhatsApp-like platform for tour operators, where they connected the people joining the tours to tour operators. They soon found that this model was not scalable at all. 

V2: Meta-search model: Shifted to a cost-per-click model, similar to Skyscanner. However, tour operators were hesitant about this new technology, especially back then when CPC was a new concept where no booking was confirmed. 

V3: CPA model: Evolved to a cost-per-acquisition model, taking leads and tracking them. 

Today: Booking platform: In 2013, Erik Blachford (Angel investor and founding member of Expedia) was instrumental in their pivot to become a full-booking platform that customers felt comfortable spending $3,000-5,000 on.

This meant becoming the merchant of record, capturing emails, and owning the customer. 

Solving the two-sided marketplace challenge

Building a successful two-sided marketplace is often a chicken-and-egg problem: suppliers won't join without customers, and customers won't come without suppliers.

Here’s how TourRadar managed this issue: 

Supply side. Starting off, Travis and his team went to travel shows where you would have the biggest tour operators present and he’d just offer them free listings.

For them, given it was a pure upside situation, they were very happy to just try what this could do for them. 

At this point, Travis and his team were hyper focussed on just getting the supply there and didn’t want to scare off suppliers with the commercials.

They relied on the example of Booking vs Expedia in the early days, where Booking.com won because of the amazing job they did with connecting the very fragmented supply. 

Demand-side. TourRadar capitalised on their SEO expertise from a previous venture, Bugbitten.

Like an early Instagram, this website was used by travelers to upload pictures, Travis & Shawn scaled this to a point where people were uploading 5-10k photos a day in 2004. 

Given this content was highly relevant to TourRadar, they began funneling customers interested in travel (from Bugbitten) to TourRadar, where they can purchase their next travel experience.

They encouraged users from their previous platform to write reviews of tours they'd been on, building credibility and content.

🤑 How Do They Make Money?

TourRadar operates on a commission-based model, taking a percentage of each booking made through their platform, while also upselling other services through B2B partnerships. 

Micro-conversions for macro-growth. Erik Blachford (investor) emphasised to them the point of micro-conversions, i.e. small wins with a customer.

This can be them inputting their email, downloading the app, signing up to it or any other step towards making a purchase. 

For TourRadar, given they are selling big ticket items ($3-5k), it is absolutely essential to stay on top of mind for their customers given longer sales cycles.

This pushed Travis and team to begin collecting emails and contact data for their customers to push them through the funnel and educate them about the product. 

Platform strategy. TourRadar went into COVID being a 100% B2C play, but quickly realised that they will need to create a full platform offering to bulletproof themselves.

This created a massive opportunity for embedded finance (insurance), tours in the city, and many other B2B partnerships. 

Negative revenue. Travis details how the shock pandemic lockdown created a unique (and disastrous) situation of not only zero revenue, but also negative revenue. 

🧑‍🤝‍🧑 How Did They Build Their Team?

Hiring strategy. TourRadar focused on hiring based on core values (they started with 12, now refined to 5), focusing on cultural fit alongside skills and experience, and most importantly, being cautious during hyper-growth phases to maintain culture

Making 1 good decision. The COVID-19 pandemic hit TourRadar hard, dropping revenues not only to zero, but below zero.

During this time, Travis had to step up as leader and realised that his focus needs to be on being in the best possible mental space to ensure the best outcomes. 

🤝 How Did they Raise Money?

Travis recalls that at the very beginning the focus remained on how they wanted to digitise and “bring online” the category, which led them to getting investment from Hoxton Ventures, Cherry Ventures and Speedinvest. Later investors began focusing more on unit economics and scalability. 

Grow at all costs. Travis elaborates how his growth-stage investments (e.g., from TCV), came during the time of “grow at all costs”, where stories like WeWork were making headlines. 

🎤 SCALE ADVICE COLUMN

📖 TourRadar Fact Sheet

Series A: $6Mn in 2016

• Team Size: 50

• Key Challenges: Scaling demand, product/market fit

• Key Achievements: 4x growth in revenues vs previous year

Series B: $10Mn in 2017 

• Team Size: 100

• Key Challenges: Building platform to scale supply, connecting suppliers directly to customers via the marketplace

• Key Achievements: Massively scaled the team and doubled-down on North American market

Series C: $50Mn in 2018

• Team size: 175+ (up to  300 pre-pandemic, then down to 90)

• Key Challenges: Scaling team in all areas

• Key Achievements: 3x supply in the marketplace, 2x revenue growth in North America

• Key metrics:

  • 5 million email subscribers

  • 50,000+ adventures available

  • 2,500+ tour operators

  • Present in multiple languages and markets

• Average order value: $3,000 - $5,000

💹 What's Next?

Looking ahead, TourRadar is focusing on several key areas:

1. Mobile optimization: Developing and growing their mobile app to capture on-the-go bookings, as customers get more comfortable with making large purchases online

2. Ecosystem expansion: Partnering with major travel agencies and OTAs to reach mainstream consumers

3. Rebranding: Rebranding their offering as "Organized Adventure" to appeal to a broader audience

4. M&A opportunities: Exploring potential acquisitions to consolidate the multi-day travel packages market

If you are an investor or would like to work with TourRadar, get in touch at [email protected].

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