PAX – Personal Airline Exchange.
Imagine the convenience and comfort of flying jet charter at the cost of an airline ticket – now you know the PAX vision!
PAX launched to disrupt the jet charter market. The conundrum is why previous attempts to disrupt jet charter had not succeeded. Several prominent individuals tried but failed to reach breakaway traction. Researching other markets where disruption has occurred, the answer is that previous attempts in charter focused on only half of the transaction, the buyer. The seller, charter operators, lack incentive to adopt new systems if there is little benefit to them. Successful market disruption requires both parties to benefit from, and embrace the solution.
For example, AirBNB was not the first player for vacation rentals. But AirBNB created a robust match-making system – streamlined steps and transaction security. AirBNB improved the buyer experience, but what drove breakaway traction was providing hosts with critical information about the guests, making it easy for hosts to make a “go/ no go” decision on accepting the rental request. AirBNB attracted new host participants, growing their inventory dramatically and achieving network effect.
PAX built a prototype with seed funding from SGL in Santa Monica in 2015. The prototype successfully reached traction across key performance indicators: site traffic, online quotes, online flight requests and charter sales. The prototype provided information to refine the model, where PAX can build competitive barriers, and how to appeal to charter operators.
The current charter market is thin, only a small percentage of travelers use it. To disrupt the market requires improving efficiency using flight optimization algorithms, introduction of new charter products that appeal to a broader audience, and a system that manages the negotiation entirely online amongst multiple parties.
PAX has a three pillar strategy that achieves this:
- Market Design to address the inefficient business processes and embed our proprietary flight optimization algorithms. Trade secret IP.
- Discovery Engine that provides a multi-party, real-time negotiation tool for buyers and sellers. Patentable IP.
- Launch Plan to build flight volume within a narrowly defined region, allowing introduction of new charter products as well as increased operator engagement.
The PAX team possess the cross discipline skills and experience to execute the strategy. No other company in this space has the depth and breadth of knowledge and experience of the PAX team.
This funding round executes the three pillar strategy and puts PAX in position to build network effect within a region, leading to a growth-funding round to expand to national coverage.
During Beta launch testing, the App attracts >5,000 users that request 1,080 online quotes, which followed with 41 flight requests, resulting in $105,400 in charter sales.
Marketing spend was very modest, under $3,000/month in AdWords.
Beta launch in Telluride CO ski market drives over $15,000 in sales on site. No marketing beyond local mention by Telluride Ski Resort.
Released on-line quote system for any city pair. Provides accurate pricing and proper aircraft based on trip length and passenger count.
Prototype attracts >5,000 users that request 1,080 online quotes, 41 flight requests, resulting in $105,400 in charter sales.