Toronto-based traveltech startup Snapcommerce announced in March 2021 that it has bagged CAD 107M in growth funding led by Inovia Capital through its Growth Fund I and international private equity firm Lion Capital. Other funding round participants include Acrew DCF, Thayer Ventures and Full In Partners, and existing investors Telstra Ventures and Bee Partners.
The startup will use the proceeds from the funding round to invest in its comprehensive mobile commerce play, which will be supported by a much larger team. It is also looking forward to expanding its current team of around 150 employees to 450 by early 2022, 300 of which will be customer service roles.
About the startup
Hussein Fazal and Henry Shi founded the startup in 2016 (formerly known as Snaptravel). Snapcommerce’s AI-driven platform enables, allows users to find and book hotels and flights through messaging tools like SMS and Facebook Messenger at the right prices.
Statements from the stakeholders
CEO Hussein Fazal said the funding will help them grow faster and eventually get to that point where they could take the company public and execute on that bigger vision of transforming the way people shop on their phones. He added that it is a big step up, and would help them accelerate the business.
Inovia partner Chris Arsenault sees Snapcommerce’s mobile approach as the future of commerce. Inovia’s decision to suggestively increase its investment in Snapcommerce is directly related to the startup being ready to expand beyond Snaptravel. Arsenault was quoted to have said, “For us, the reason why we’re doubling up is also that the platform is ready to actually go after other verticals as well, outside of travel.”
Since its inception, Snapcommerce (via Snaptravel) has been used by more than 10 million customers that have exchanged over 100 million messages, which the startup says led to more than US$ 75M in direct savings. At some point this year, Snapcommerce expects it will exceed US$1 billion in total mobile sales done through its platform, mainly driven by Snaptravel. This is an outstanding number, as, in October, the startup reported US$ 350m in sales and 2 million users.
Hussein Fazal noted, “We were actually able to turn the company around, get the company to profitability and get the company back to growth. So, if you combine that with the vaccine news, the vaccine rollout, the pent-up travel demand, what we expect in the travel space over the next one to two years that obviously got investors really excited.”
Previously, the startup had raised US$ 21M in a Series A funding round held in 2018.
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