Founder of Uber for booking flights Sergey Petrossov told his success story
Earlier, Megamind wrote that the service for booking private flights, JetSmarter , raised $ 20 million in Round B. The founder of the service is Sergey Petrossov, a native of Russia.
Petrossov had several IT projects designed for the Russian market, but the real success came to him thanks to the startup JetSmarter - this is “Uber for the private jet market,” as described by the businessman himself.
Sergey Petrossov told Slon Magazine about his previous projects, about failures, about the history of the JetSmarter service, about the prospects for its development, as well as about working in Russia.
Megamind provides the most interesting quotes from the interview .
About their first projects in Russia
When I started several companies here, I already had experience in IT business in the USA - I worked on it even when I was 18 and studied at a university in Florida. My first technological project - LiveContact, was really made by the hands of developers from Russia. It was a SaaS service aimed at Western Europe and offering sites to organize customer support through chat, audio and video. We sold LiveContact, to which several hundred sites connected, rather quickly, in 2009, but I can’t name the buyer’s name and transaction conditions.
About the project of distance education system
Yes, this project was associated with software for universities and schools, which were able to organize distance learning for students and pupils. We reached the base for about 100 thousand students, four universities connected to the system: Moscow State University. Lomonosov Moscow State Law Academy, Moscow Institute of Railways, Siberian Federal University.
It was assumed that the project would be of a national scale and would receive state support (state universities should have become clients), but due to bureaucracy and corruption in the Russian education system, the project never reached the federal level. In 2012, we licensed the product to the state, I left the project. The company currently licenses software to several universities and private companies in the distance learning market.
The project was not [especially] financially successful, but it gave me acquaintance with many politicians, successful businessmen and even billionaires.
About the analogy between Uber and JetSmarter
The analogy between JetSmarter and Uber is that both services allow you to quickly and conveniently book a flight in a mobile application. With us you can do this in a few minutes, bypassing the chain of brokers, and fly away in a few hours. We calculate the availability of flights in real time, based on information directly from airlines. There are a lot of nuances here - you need not only to track from which point the plane is moving to, but, for example, take into account the time spent in flight by the pilots, refueling the aircraft, and so on.
There are three products inside the application. At JetCharters, users can book a charter for a flight by specifying the direction and type of vessel, at JetDeals we offer a one-way flight search - to close the so-called empty legs when the jets fly empty to the point where they should pick up the passenger. The third service is JetShuttle, where the user can reserve one seat on an airplane that flies on a regular flight, so far these are flights only in the USA, but we plan to expand the geography. JetSmarter services are available in 170 countries.
For membership for frequent flyers, we charge $ 3,000 as an “entrance ticket”, and then $ 9,000 annually. With membership you can fly for free with empty flights, finding them on JetDeals, without it you get such flights at prices with great discounts (up to 70% of the usual prices for charters).
Additionally, those who apply for membership receive discounts on regular charter flights at JetCharters - 10-30%, as well as a personal "concierge" who can book, for example, a table in a restaurant at the place of arrival, buy tickets for a concert, rent a car, etc. .d. Members are available about four thousand free flights every month.
About the audience of the service
Since the launch in March 2013, we have grown and are growing by 15–20% per month, now we have about three hundred thousand application installations. The number of users who bought membership, I can not disclose.
We expect that by the end of 2015, the number of bookings through the application will be 10 thousand. Calculating the number of bookings per month is difficult, because in some months the user base is growing by 20%, in some - by 100%.
[Most often fly] in the so-called "Golden Triangle" - between Los Angeles, New York and South Florida.
We focus on a wealthy audience, with a personal fortune from $ 100 thousand to $ 1 million, but in fact there are other users. I often say that we have one college student who bought a membership by breaking the fee into payments on two credit cards. There are other stories, but, unfortunately, I can’t share them - many of our users do not want us to talk about them.
About the specifics of the Asian market
In Asia, users are a little more demanding, but overall their preferences are no different. The biggest difficulty in entering a new market is not in users, but in finding aircraft suppliers that are suitable for the operation of our JetDeals and JetShuttle applications.
About the recent round of $ 20 million
It was already round B, it was attended by members of the royal family of Saudi Arabia, several world-famous musicians and people from the entertainment industry, as well as the London private equity fund, people from those who analysts call UHNWI (ultra high net worth individuals), and also family offices and C-Level executives (top managers: CEO, CFO, etc.) from companies such as Goldman Sachs and Twitter .
I can’t name specific names, except for those already voiced (the prince of Saudi Arabia, Abdullah bin Bandar bin Abdul-Aziz al-Saud and rapper Jay Z, according to Business Insider), but I can say that all of our private investors who invested both before and during Round B were business aviation customers knew us. I can say that everyone who participated in the recent round were JetSmarter users.
About development plans in Russia and in the world
We will expand our services, primarily JetDeals and JetShuttle. We plan to increase the volume of offers in markets such as China, Japan, Taiwan, Korea, Singapore, Indonesia, as well as New Zealand and Australia. In 2016, we want to pass the mark of 1 million users and 50 thousand bookings for the year. At the same time, we expect that the number of aircraft available in the application will not be more than 3.3 thousand. We estimate the world market of flights on private jets at $ 60 billion, the business aviation market - 2-3 times more.
The money of the recent round went to expand partnerships with airlines, including in Russia.