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9 Failed Travel Startups & the Reasons Behind

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There are a lot of things to consider when building a new startup - where to get funding, how to validate your idea, and what features should the product have.

One of the challenges is finding a market that is willing to pay for your solution without even knowing what it is yet.

However, 90% of startups will fail and shut down.

In this article, you can find 9 failed Travel startups as well as analyses on why they closed down.


9 Failed Travel Startups

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Desti

Desti

Desti was a traveling and mapping iPad app that used AI to help planning a trip. Although users found it useful, they ended up booking on other platforms.

Details of the startup:

  • Founders:

    Imri Goldberg, Mosi Shuchman, Nadav Gur

  • Country:

    United States

  • Industry:

    Travel

  • Started in:

    2011

  • Closed in:

    2014

  • Nº of employees:

    1-10

  • Funding Amount:

    $1M-$10M

  • Specific cause of failure:

    Bad Business Model

You can read more about their failure here.

Dopplr

Dopplr

Dopplr was a social travel network service. In 2009, Nokia acquired it for $20 million and the number of Dopplr users fell since then until shutting down.

Details of the startup:

  • Founders:

    Dan Gillmor, Lisa Sounio, Marko Ahtisaari, Matt Jones, Taneli Tikka

  • Country:

    United States

  • Industry:

    Travel

  • Started in:

    2007

  • Closed in:

    Active

  • Nº of employees:

    1-10

  • Funding Amount:

    No Data

  • Specific cause of failure:

    Acquisition Flu

You can read more about their failure here.

HotelsAroundYou

HotelsAroundYou

HotelsAroundYou was an India service centered on last-minute and short stay bookings. They weren't capable of raising more money and had to shut down.

Details of the startup:

  • Founders:

    Animesh Chaudhary, Harsha Nallur, Mohsin Dingankar

  • Country:

    India

  • Industry:

    Travel

  • Started in:

    2013

  • Closed in:

    2017

  • Nº of employees:

    1-10

  • Funding Amount:

    < $1M

  • Specific cause of failure:

    Competition

You can read more about their failure here.

RoomsTonite

RoomsTonite

RoomsTonite was a last-minute hotel booking app for people traveling to India. They raised $1.5M in funding but the money didn't arrive and they shut down.

Details of the startup:

  • Founders:

    Suresh John

  • Country:

    India

  • Industry:

    Travel

  • Started in:

    2014

  • Closed in:

    2017

  • Nº of employees:

    100-250

  • Funding Amount:

    $1M-$10M

  • Specific cause of failure:

    Lack of Funds

You can read more about their failure here.

Stayzilla

Stayzilla

Stayzilla was a successful homestay network that raised $33.5M in funding. Their operational costs were too high and they were losing money every year.

Details of the startup:

  • Founders:

    Rupal Yogendra, Sachit Singhi, Sachit Singhi, Yogendra Vasupal

  • Country:

    India

  • Industry:

    Travel

  • Started in:

    2005

  • Closed in:

    2017

  • Nº of employees:

    250-500

  • Funding Amount:

    $10M-$50M

  • Specific cause of failure:

    Lack of Focus

You can read more about their failure here.

Utrip

Utrip

Utrip was a travel planning startup that used AI to create personalized itineraries. Keeping the recommendation engine alive was too much for them.

Details of the startup:

  • Founders:

    Gilad Berenstein, Yair Berenstein

  • Country:

    United States

  • Industry:

    Travel

  • Started in:

    2012

  • Closed in:

    2019

  • Nº of employees:

    10-50

  • Funding Amount:

    $1M-$10M

  • Specific cause of failure:

    Mismanagement of Funds

You can read more about their failure here.

WOW Air

WOW Air

WOW Air was the Icelandic answer to RyanAir for low-cost air travel in Europe. The cause of failure was that they wanted to become too big too fast.

Details of the startup:

  • Founders:

    Skuli Mogensen

  • Country:

    Iceland

  • Industry:

    Transportation

  • Started in:

    2011

  • Closed in:

    2019

  • Nº of employees:

    50-100

  • Funding Amount:

    No Data

  • Specific cause of failure:

    Multiple Reasons

You can read more about their failure here.

Onepagetrip

Onepagetrip

Onepagetrip was a travel itinerary sharing community. Not having a plan to make money from the beginning was a stupid rookie mistake.

Details of the startup:

  • Founder:

    Ana Santos

  • Country:

    Australia

  • Industry:

    Travel

  • Started in:

    2014

  • Closed in:

    2015

  • Funding Amount:

    $0

  • Specific cause of failure:

    Bad Business Model

You can read more about their failure here.

Vacation Bird

Vacation Bird

Gene founded VacationBird, a marketplace for finding your vacation rental. It was an early version of Airbnb and a VRBO competitor. Having a misalignment of incentives between co-founders and poor planning were the main causes to shut it down in 2012.

Details of the startup:

  • Founder:

    Gene Maryushenko

  • Country:

    United States

  • Industry:

    Travel

  • Started in:

    2011

  • Closed in:

    2012

  • Funding Amount:

    $0

  • Specific cause of failure:

    Lack of Experience

You can read more about their failure here.

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