Traveloka’s Valuation Exceeds OVO, the Company is Ready to Rise Again
Research company CB Insights reports that the valuation of a digital-based tourism service provider or an online travel agent (OTA), Traveloka reaches US$ 3 billion or around IDR 44.2 trillion. Its valuation exceeds OVO and Bukalapak.
The startup’s valuation has increased compared to the CB Insights report entitled “Global Unicorn Club” in November last year, US$ 2 billion. This increase was after Traveloka obtained funding of US$ 250 million or around IDR 3.6 trillion last July.
The fresh funds were obtained from a global financial institution. In addition, existing investors participated in the funding, including EV Growth. A Bloomberg source who is aware of the funding plan said Traveloka’s valuation is estimated to drop 17 percent from US$ 3.3 billion to US$ 2.75 billion or IDR 39.7 trillion.
The company is said to be ready to break even next year, and even have the potential to make a profit. However, this is if the travel industry recovers at least 50% compared to before the corona pandemic.
Traveloka Co-Founder and CEO Ferry Unardi said that the company is on the right track to reap profits. This was conveyed during an interview with Bloomberg journalists, in November last year.
The Company Plans an IPO in 2021 to 2022
The company’s efforts to maintain financial stability are in line with the plan to offer an initial public offering (IPO) in 2021 to 2022. Traveloka also focuses on services in the lifestyle and financial sectors. However, the coronavirus pandemic has hit the tourism industry businesses, including Traveloka.
Last July, Ferry said that consumer demand dropped drastically, while refunds jumped significantly. Based on CB Insights data, the number of visits to the platform per month fell by 7.02% as of early September.
The hotel occupancy rate has also decreased to its lowest level. Domestic and regional lifestyle activity partners, as well as restaurants, have even had to temporarily close business operations due to the Covid-19 pandemic.
This resulted in the business falling to an unprecedented low since it was founded. Even so, Ferry is optimistic that his company will rise again with the rapid adjustment of business strategy.
In Vietnam, for example, the business has begun to stabilize and is approaching the period before the Covid-19 pandemic. Meanwhile, in Thailand, it is almost over 50% compared to the normal situation.
“Although Indonesia and Malaysia are still in the early stages of recovery, these two markets continue to show promising momentum with progress from week to week,” Ferry said as quoted in a press release, last July (28/7).
Launched a Variety of New Services
Traveloka also launched a variety of new services such as a corona risk test for virtual tours. During this strategy, the company also received funding even during a crisis due to the pandemic. The unicorn has at least 20 more products.
There are seven related trips such as booking plane tickets, buses, trains to rental cars. Then there are four surrounding the inn. Then there are five services regarding lifestyle, such as booking tickets to watch movies at the cinema, Traveloka Xperience, restaurants, city guides, and vouchers.
The company has indeed launched several new services during the Covid-19 pandemic. In April, this unicorn will provide the XERU Window video content feature on the Traveloka Xperience platform.
Then, presenting a donation package ranging from IDR 11 thousand to IDR 27 thousand per portion to support Traveloka Eats restaurant partners last May. Then, the company provided risk testing services for contracting Covid-19 in 44 cities in June. Traveloka also promotes flash sales through the live streaming feature on social media.
The company is aggressively marketing products with content about staycations, road trips, and others following health protocols. Also, there are seven products related to finance, namely insurance, points, paylater, digital wallet through Uangku, top-up balances, connectivity and data, and international data plans.