Caisse buys C$200-million stake in travel software firm Plusgrade
12/03/2018|9:03:39 PM|The Globe and Mail

On Wednesday, the Caisse de dépôt et placement du Québec is announcing it has bought an undisclosed stake in Ken Harris’s nine-year-old Montreal-based Plusgrade LP, valuing a software company that has been described as an “eBay for business class airline tickets” at more than $600-million. It’s the largest investment into a Canadian private technology firm this year, and the latest in a string of big-ticket investments by the Quebec pension management giant. Plusgrade is also the latest in a string of Montreal-based travel technology companies to draw significant outside investments, including Hopper and Luxury Retreats. 

Carriers digitally tell customers in lower seating classes several days before a flight that upgraded seating is available in higher classes. Interested customers then bid for the seats, with airlines notifying winners a day or two before the flight. As a result, carriers can earn hundreds of dollars on otherwise unsold premium seats, paying Plusgrade a 15-per-cent cut. Mr. Harris said customers end up paying 50 to 80 per cent of the full fare for business class this way.

Plusgrade is used by 70 airlines including Air Canada, Cathay Pacific, Lufthansa and Virgin Atlantic, although U.S. carriers, who regularly bump up elite fliers to business class, have been slower to sign on.

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