Almaz Capital, an international venture fund with Eastern-European roots, and Sistema VC, the venture arm of the Russian conglomerate Sistema, have invested $4 million in a US mobile travel app called FinalPrice.
With FinalPrice’s iOS mobile app, users “get access to the secret cache of ultra-low prices on flights, hotels, and car rentals” for $99 per year. A free option is available too.
FinalPrice’s AI-powered recommendation system Travel Score builds a list of offers based on each user’s previous preferences and travel history.
The project, which launched last week, is headed by Peter Kutis, a talented entrepreneur who previously founded Russia-based OTA Onetwotrip.
In an exchange with Russian industry publication VC.ru, Kutis said that he chose the USA to launch the new service due to the size of the travel market and the development of subscription-based services in this country.
“The subscription-based model allows us to avoid taking a fee on each deal, thus we can offer the lowest possible prices,” said Kutis.
FinalPrice claims to offer discounts of up to 30%.
“Many industries have switched to the subscription-based model — look at Netflix, Spotify, Amazon and other companies. Meanwhile, OTA (online travel agencies) are stuck in the old paradigm of requesting a fee for every deal. They have virtually turned their users into the hostages of their competition for the best prices and largest number of offers,” he added.
FinalPrice says that they have partnerships with 1 million hotels, 800 airlines and 40 rental car services.
In 2015, the US travel market reached $329 billion, with online booking services accounting for $173 billion, according to data from The Global Business Travel Association and Phocuswright cited by Sistema VC.
