Since 2015, the majority of the travel industry’s innovation has been in SaaS and FinTech solutions. We’ve seen the rise of great corporate travel platforms like Navan and Travelperk, as well as FinTech companies like Flywire and Revolut transforming global payments.

As these categories mature, two new windows of opportunity have emerged: AI and personalisation (see timeline from Mauricio Prieto below). Investment from VC and big tech is flowing into personalised recommendation engines and GenAI booking assistants, with Mindtrip, Expedia’s Romie, Google’s Gemini, and even ChatGPT itself entering the fray. 

We believe that AI-driven travel planning and booking will see rapid adoption in the near term. This is an exciting development that will change how travellers plan, book and pay for journeys, and the disruption could create opportunities for startups to capture market share. The challenge will be capturing this market share before products such as AI booking assistants become commonplace and therefore make it more difficult to build a defensible moat.

So where are the more durable, defensible opportunities in Traveltech? As a B2B software investor, we’re more excited about the less visible but highly impactful areas of the value chain: post-booking operations; travel infrastructure; and specialised segments like group, luxury and corporate travel.

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Post-booking and travel operations

Booking a trip is only the beginning – much of the real difficulty of travel organisation comes afterwards. From luggage handling policies to the integration of critical elements like Global Distribution Systems (GDS) and New Distribution Capabilities (NDC), travel operations are a pain point directly impacting customer satisfaction, with fairly limited customer support.

Why we’re bullish here:

• Call centre automation: a prime use case for Generative AI to create efficiencies
• High stickiness: once embedded in workflows and integrated with CRMs, GDS and reservation systems, these solutions become very hard to get rid of, i.e., switching costs are high
• Cost centre impact: operations are a major expense for TMCs, Online Travel Agents (OTAs), airlines and hotels
• Vertical advantage: travel-specific solutions will outperform horizontal tools like Zendesk or Salesforce, which struggle with the sheer number of use cases, legacy integrations and industry nuances.

Given the complexity and maturity of the travel industry, winners will likely be founded by industry insiders who understand the unique pain points. Whoever cracks this first will have the opportunity to define the category.

Some exciting companies:

• Acai Travel (Nauta portfolio): AI tools to streamline and automate travel agency operations by interpreting live travel data (fare rules, schedule changes, refunds)
• Oversee: AI to optimise travel spend, automate operations and generate savings & revenue for travel businesses (TMCs, OTAs etc.)
• Amgine: Automation for corporate travel management, enabling travel requests (via email, Slack, etc.) to be parsed and matched to itineraries automatically
• Deal Engine: AI and APIs to automate post-booking tasks for airlines and travel agencies (changes, refunds etc.), eliminating manual steps‍
• chatlyn: AI-powered communication tools (chatbots, voice, reviews etc.) for hotels and hospitality to automate guest messaging and virtual concierge functions

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Travel infrastructure and distribution

The complexity of travel operations largely stems from its outdated infrastructure. The backbone of modern travel infrastructure dates back to the 1960s and 1970s, when airlines developed the first computer reservation systems (CRS) such as Sabre (1964) and Apollo (1971) which later evolved into multi-airline Global Distribution Systems (GDS) like Amadeus and Galileo (now Travelport), quickly becoming the primary platforms for selling flights.

These systems still dominate distribution today. Despite (or maybe due to) several attempts at modernisation, the infrastructure of travel remains complicated; not only because of the various layers of legacy code and outdated systems, but also due to the sheer number of intermediaries in the value chain. 

From owners of GDSs and NDCs to consolidators, wholesalers, channel managers, and OTAs, each additional party makes integration more difficult and slows innovation. For example, the diagram below is a simplistic representation of the travel industry’s value chain, without the added complexity of NDCs and Channel Managers. To understand the full supply chain for various travel booking scenarios in more detail, you can refer to our analysis here. 

The vast web of intermediaries explains why modernising travel remains so difficult, and why companies that can abstract away these complexities will unlock enormous value.

Opportunities include:

• Helping others navigate legacy infrastructure through modern integrations
• Unlocking new distribution channels, such as whitelabel B2B booking engines for banks and telcos, or resale platforms for experiences.

Some exciting companies:

• Unravel (Nauta portfolio): Combining creator-driven travel video content with AI support and a booking engine, to drive new revenue streams for large consumer facing institutions (such as banks, FinTechs and telcos)
• Nuitee: Travel infrastructure APIs for hotels, chains and travel apps, enabling easier hotel connectivity, distribution, payments and analytics
• Zentrumhub: AI-powered, white-label hotel booking engine & unified hotel supplier API for OTAs, B2B/B2C and hotels to find-and-sell inventory fast
• Fairlyne: Resale-as-a-Service platform letting airlines, rail operators and hotels let customers resell non-refundable or no-show bookings under controlled rules‍

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Group, corporate and luxury travel

Given the legacy complexity plaguing the travel industry, it may seem that market players are entrenched and can’t be displaced – but this is not the case. There is one specific type of intermediary we have seen suffer the most with the arrival of digitalisation: travel agencies!

Many traditional travel agencies have been displaced by OTAs, especially where booking processes could be easily automated. We expect AI assistants like Gemini, Mindtrip, and ChatGPT to keep reshaping the agency landscape, and OTAs should continue to innovate to stay relevant.

However, the segments of group, corporate, and luxury travel remain opportunities for agencies to flourish, so long as they accept digital innovation:

• Group travel: still highly complex, with little automation today (e.g., religious tours)
• Corporate travel: requires adherence to company policies, approvals, and expense management
• Luxury / niche travel: Customers expect hyper-personalisation, whether it’s bespoke itineraries or specialised trips.

These categories won’t disappear and, in fact, may become more important as automation transforms simpler parts of the industry. They also represent some of the most attractive customer bases for software vendors.

Some exciting companies:

• Mogu: SaaS tool for travel agencies / tour operators that lets them build proposals quickly, manage inventory, payments and communicate with customers
• WeTravel: Platform for group travel businesses, offering itinerary building, booking and payments, supplier payouts, payment plans and dashboard/management tools
• Cvent: SaaS tool focused on managing in-person, virtual, and hybrid events (registration, venues, attendee engagement and lead capture etc.)
• Groupdesk: Cloud-based ERP tool for tour operators and group-travel agencies to manage group bookings, payments, inventory, branding and enable self-service
• HandsIn: Payments solution enabling travel customers to split the cost of a booking at the checkout stage

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Who and what have we missed?

Though AI will undoubtedly play a central role in the future of Traveltech, the biggest opportunities may not be in the most visible booking assistants, but in areas such as post-booking operations and infrastructure, and specialised travel segments are areas in which innovation can create real defensibility.

At Nauta, we believe these are the promising windows of opportunity where the next generation of Traveltech leaders may emerge.

If you’re innovating in B2B Traveltech and believe Nauta is the right investor for you, please don’t hesitate to reach out to our team or share your pitch through our website here.