Customized travel startup Sinbad gets multi-million financing
Sinbad has received a multi-million RMB Series A financing from Shenzhen Capital Group.
ChinaTravelNews – Customized outbound travel service specialist Sinbad has received a multi-million RMB Series A financing from Shenzhen Capital Group. The travel company with 1,000 boutique overseas agencies registered on its platform previously received an angel investment from well-known investor Xiangyang Yang.
Guangzhou based-Sinbad went online in 2012 and is one of the first online customized travel startups in China. Customized travel requiring high operational costs used to be a luxury domain for the wealthy, but it is now increasingly adopted by the middle class as their demand for personalize travel is growing， and startups like Sinbad, 6renyou and Unique Way are cutting operation cost with their online business models.
Challenge of scalability for customized travel
“The key issue here is whether or not we can achieve scalability. It’s so difficult to get scalability because customized travel doesn’t offer standardized products, and customers have varied requirements for non-standardized products,” Sinbad’s founder and CEO Yunlong Pan told ChinaTravelNews.
Sinbad has set up a B2B2C transaction platform that leverages user behavior graphing and big data to curate and search matching offerings by offline overseas destinations’ service providers. Sinbad’s business model is to provide a platform with wholesale-level business and management for a supplier chain that includes insurance, air tickets, visa and overseas WIFI providers. It charges a transaction fee and already has monthly sales turnover of RMB 4 million. The company expects to be profitable by the end of this year.
“Our massive system includes varied itinerary solutions data and point-of-interest (POI) information that we can smart match via user attribute and interest spectrum obtained from big data to find the best travel solutions for users,” Mr. Pan said, adding that smart matching accounts for some 60% of completed transactions.
“Product fragmentation allows us to reconfigure offerings to meet the requirements of users. Traditional tour agencies take at least 10 days to make a customized travel solution for customers, while Sinbad leverages supplier data on its cloud terminal and smart matches with user requirements to cut costs and speed up service” he said.
Helping overseas boutique agencies tap into the Chinese market
The 1,000 local agencies on our platform are all independent tour agencies that typically receive select independent tour groups instead of large tours from national wholesalers. These boutique agencies excel particularly in offering immersive experiences,” Mr. Pan said.
In the past these agencies catered mainly to clients from Hong Kong, Taiwan, Japan, Korea, US and Europe and rarely received Chinese customers. The rising demand for select travel among the Chinese middle class has slowly opened up this market.
Local suppliers face issues of small orders and difficulties in managing dispersed orders if they tap the China market via traditional mainland travel agencies. However, by joining Sinbad’s online platform, service providers can digitize their product inventory management and implement structured service processes to increase their sales efficiency in the Chinese market, he said.
Another advantage of Sinbad is its extremely high rate of repeat customers. Mr. Pan said: “Many of our customers travel with their families and are satisfied with our products and service model. Some 90% of our customers make repeat purchases. We also have plenty of VIP members who make lifetime travel plans with us.”(Translation by David)
(Report by Jianjun Yao)