Travelstart, the South African-based Online Travel Agency (OTA) with offices throughout Africa and subsidiaries in the Middle East and Turkey, on Wednesday announced a capital raise of $40 million from Amadeus Capital Partners, the global technology investor.
With the new funding comes a strategic partnership with Africa’s largest mobile telecommunications provider MTN, which has a subscriber base of more than 230 million. The funding will be used for Travelstart’s expansion and to solidify the company’s position as the biggest OTA player on the continent.
Africa is considered the final frontier in online travel. In most mature economies, web and mobile travel purchases makes up the lion’s share of the online travel market. However, web-based travel makes up less than 5% of the entire online travel market in Africa.
“Africa is a $50 billion travel market growing between 3% and 5% annually” – Stephan Ekbergh, CEO, Travelstart
“Travelstart celebrates 10 years in Africa this year,” says Travelstart CEO Stephan Ekbergh. “In that time our in-house team has built a robust platform to serve consumers and significantly lower fares for all travelers. We take all the complexities out of travel for both travelers and suppliers and solve real problems that only exist in the most diverse of markets.”
“Africa alone is a $50 billion travel market growing between 3% and 5% annually. The investment from Amadeus Capital and the MTN partnership is a fantastic fit for our company as we share the same ideology and long-term commitment,” said Ekbergh.
Amadeus Capital Partners’ Andrea Traversone will join Travelstart’s Board of Directors as part of this financing.
“The market potential for Travelstart is huge and the company is already a tour de force in emerging markets. They are one of the most profitable e-commerce companies on the African continent and with this new round of funding, Travelstart will be able to fast-track its already rapid growth. We’re excited to spearhead this round and to see the company’s continued growth and success,” said Traversone.
MTN’s Group Chief Digital Officer Herman Singh added: “MTN’s vision is one of delivering a Bold New Digital World and this investment in partnership with Amadeus is a key step on a multi-year journey to achieve that promise. It strongly complements our existing investments in online and e-commerce in retail, marketplaces, classifieds and travel. This investment in the largest multi-national player in a very large and rapidly growing market positions MTN as an enabler of exciting new leading edge businesses. The MTN footprint, subscriber base, payment capability, network and brand awareness strongly underpin the synergies already being manifested in our other investments. We look forward to working with Amadeus and the Travelstart team to accelerate the business development of this adjacency.”
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