Luxury travel SPAC deal takes subs to next level
NEW YORK, June 30 (Reuters Breakingviews) – Inspirato wants to shift travel – and subscription-based business models – up a notch. The elite vacations firm has agreed to merge with special purpose acquisition company Thayer Ventures Acquisition (TVAC.O) in a deal valuing it at $1.1 billion. Subscriptions are in vogue, but this takes the idea to a new level.
Think of Inspirato as a cross between Airbnb (ABNB.O), Soho House read more , and Expedia (EXPE.O). Its 12,500-ish customers pay memberships for access to swanky hotels, resorts and residences – either $600 a month plus the price of each stay, or $2,500 all-inclusive. Luxury hotels can sell empty rooms to Inspirato at a discount, without having to publicly cut their rates. Customers get variety and luxury at a predictable price.
It’s a neat idea, but will the rich commit? The company compares itself to Netflix (NFLX.O) and other businesses that take monthly fees. But there’s a difference. A Netflix subscription of $168 per year is just 0.2% of the median U.S. household income – small enough to sign up and forget. An Inspirato Pass member making $250,000 a year would be stumping up 12% of their income, an altogether different proposition. (By Jennifer Saba)
On Twitter http://twitter.com/breakingviews
Capital Calls – More concise insights on global finance:
Didi debut hands tip to Uber read more
Space SPAC stumble read more
Long live Houston-based drillers read more
Testmaker’s activist spat risks M&A rerun read more
Amsterdam SPAC can give Gallic bankers M&A boost read more
Editing by John Foley and Amanda Gomez
Reuters Breakingviews is the world’s leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.
Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.