FinalPrice raises 4 million dollars. Would subscription model succeed?
The US app FinalPrice raises USD 4 million in funding. It charges members $99 a year and claims that someone spending $10,000 a year on the site will save $2,500.
Many travel brands have talked about becoming “the Amazon of travel” but FinalPrice, a Los Angeles-based startup using a subscription model, wants to become “the Amazon Prime of travel”.
The app-only product has picked up $4 million in funding to kickstart its launch, with the cash earmarked for marketing initiatives, product development and scaling.
The funding round is led by two firms. Sistema VC is the investment arm of Sistema, a Russian holding company with interests across many verticals and which is listed in London and Moscow. It invests in “deep tech startups and next gen infrastructure”.
Kutis thinks that the subscription model will resonate in the US where Netflix, Spotify and Amazon Prime are normalising annual fees. FinalPrice charges members $99 a year and claims that someone spending $10,000 a year on the site will save $2,500.
The model is simple – FinalPrice will pass on the commission it would normally receive to the members as a discount or cashback, with its revenue coming from the membership fees.
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