Friday, July 24, 2015

Private Jet Travel For The Simply Very Rich Takes Off With Two Startups

Two startups are betting that more of the very wealthy set want totravel like the megawealthy do: in private jets. The companies – JetSmarter and Beacon — are both announcing this week that they have raised money from investors. JetSmarter is already offering flights between New York and Miami as well as between San Francisco and Los Angeles and elsewhere. Beacon aims to start offering as many as 18 flights a day between New York and Boston starting in mid-September.
“Our overall goal is to make all air travel private,” predicts Sergey Petrossov, founder of JetSmarter. Not this year, of course. JetSmarter is announcing on July 23 that it raised $20 million from investors who include celebrities it wouldn’t name, members of the Saudi royal family. and family offices “including top c-level executives from companies such as Goldman Sachs and Twitter TWTR -1.3%.” Petrossov founded JetSmarter in 2012. He won’t say how many customers the company has; instead he says, “This year we intend to occupy 10,000 flights.” JetSmarter doesn’t own any jets; it pre-purchases a certain amount of inventory on jets that are commercially registered. For $9,000 a year –the minimum commitment — customers can fly as much as they want. Petrossov says the company has done next to no marketing and most of its customers so far have come via word of mouth.
"At the forefront of this new era in travel, we believe that JetSmarter’s proprietary services and offerings have, and will continue to revolutionize the industry,” Prince Abdullah bin Bandar bin Abdulaziz Al Saud, a member of the Saudi royal family and an investor in JetSmarter, said in a statement from the company.
JetSmarter's app for booking private jet travel.
JetSmarter’s app for booking private jet travel.
Beacon will require a minimum 3-month commitment and a fee of $2,000 a month for unlimited flights between New York’s Westchester Airport and Boston Logan Airport. Members who join before August 1 will not have to pay an additional $1,000 initiation fee. The company announced on July 22 that it raised $7.5 million in Series A funding from Romulus Capital, MiVentures and Western Technologies Investment. Beacon cofounder Wade Eyerly, who cofounded a similar outfit called Surf Air in California in 2013, says Beacon has contracted with a group called Dynamic Aviation to operate the flights. That’s one big difference from Surf Air, which owns its own aircraft, says Eyerly.
Eyerly’s goal is to get people more quickly and comfortably between New York and Boston — in about an hour and a half from midtown Manhattan to downtown Boston, figuring a 40 minute drive up to Westchester Airport and a 40 minute flight time. That’s significantly shorter than the 3 1/2 hours it takes on the train and the 3 to 4 hours door to door it takes to fly commercially between New York and Boston, says Eyerly. “You’re buying back time,” he says. “We take the pain out of the chore you have to do.”
Beacon will offer flights on executive aircraft starting in September. (Photo courtesy of Beacon)
Beacon will offer flights on executive aircraft starting in September. (Photo courtesy of Beacon)
Eyerly predicts  –based in part on sign-ups so far — that his customer base will be age 35-65, 60% male, with an average income of $400,000 to $500,000 a year. “We know that they like cycling, wine and food,” he adds.
JetSmarter and Beacon join a number of other companies that have delved into private jet travel for the mass affluent, including Victor, Ubair and Jetsuite. For customers with plenty of funds and little time, the new services have a definite appeal.
It’s hard to imagine a future in which all air travel takes place on private jets. But it’s clearly a growing segment.
By @KerryDolan ,
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