The travel business is picking up steam this summer after a rough year, and Thatch is carving out a niche for itself in the market by allowing travel entrepreneurs to monetize their recommendations.
Wave Capital led a $3 million Seed II financing for the startup today. Jenny Lefcourt of Freestyle VC and Marc Randolph, co-founder of Netflix, was also present. Since West Askew, Abby West, and Shane Farmer started Thatch in 2018, the company has invested a total of $5.2 million.
Prior to the global epidemic, the company was a subscription-based consumer travel service that paired passengers with someone who would plan their vacations from beginning to end. Then, in 2020, the industry came to a halt, and the co-founders saw a greater need to assist travel producers — individuals who share their experiences on social media — in better connecting with their followers and capturing value for the travel advice, insights, and opinions they provide. Abby West told TechCrunch, “We realized consumers were eager to pay individuals for their time and skills.”
“Instead of going to travel firms, people are increasingly going to Instagram or YouTube and DMing them for information. We’re formalizing that relationship so the trip creator can be compensated and give a better experience for the end-user.”
According to Askew and West, travel creators are responsible for billions of dollars in consumer travel spending. Thatch’s free mobile app gives them the tools they need to start their own travel-related companies, including the ability to curate, distribute, and sell interactive trip guides and planning services. Thatch makes money by taking a small share of the transactions made by the creators.
While the pandemic harmed the travel sector, it offered the Thatch team more time to develop their software, and they are now concentrating on the creator side and marketing to recruit makers to the platform. This is where the additional funds will be used: The startup plans to hire more developers, create new content, and introduce new features for selling or earning tips on interactive instructions created by app makers. The app’s current users have a combined audience of over 12 million, and the company noticed an increase in usage in July, indicating that the travel sector is improving, according to Askew.
Following the seed, the firm will launch its monetization and booking capabilities, allowing creators to get paid, and it expects a good first quarter in terms of bookings. The founders also seek to recruit larger creators and develop a network for them, with askew stating that they should be treated as small businesses and that he wants to assist them in growing.
“Unfortunately, there is a graveyard full of travel companies,” West added, “but we are doing things differently.” “We’re different because of our people-to-people approach, and in this case, because we work with people who already have an audience and who are trusted by that audience. That isn’t something we see in this industry today.”