The pandemic had a huge and lasting effect on many sectors, perhaps none more so than travel, whose customers were forcibly denied their trade due to strict movement restrictions. Monthly Business Survey data show travel and tourism fell to 26% of its previous performance compared to 74% in other industries in May of 2020 during the peak of COVID-19 regulations. 

Many large and established travel companies ceased trading altogether, notably Thomas Cook and Flybe filed for administration, but since we’re beginning to emerge on the other side, there are some examples of organisations that have bounced back with aplomb.

Borrowaboat

One such instance of a section of the market that has not only stayed afloat but also begun to thrive is the yacht charter industry which has posted unprecedented performances since the beginning of the year. The UK based Borrowaboat has been successful in retaining existing customers due to their luxury placement in the market, a demographic less susceptible to market volatility.

What might be more surprising, however, is the apparent expansion of the organisation’s customer base into new sections of the population with less disposable income. Borrowaboat currently boasts 45,000 vessels in their roster in over 65 countries and with a global trend towards holidaying at home (the ‘staycation’), many people have looked to chartering a boat in their own country who might previously not have considered the idea.

The company launched in 2017 with a goal of levelling the playing field in peer-to-peer yacht charter offering a reliable and comprehensive platform for boat owners and those wishing to hire them – effectively streamlining the process for both parties. In 2009, Uber revolutionised the taxi sector and became a framework for many other service industries to emulate: food delivery, home shopping and even private jet hire; and Borrowabot has achieved something similar in their own field.

Airbnb, the home rental aggregator, is similar and equally successful. And like Airbnb who have over 5 million listings on their books, Borrowaboat has opted to offer a ‘Plus’ service, curating their highest end crewed luxury vessels and providing a more thorough experience with verified quality.

Funding and Investment

In June of this year, Borrowaboat closed their most successful round of crowdfunding to date, raising over £3 million GBP from 670 investors on the online equity service Seedrs. This feat places the company’s overall crowdfunding total at £7.8 million GBP and a pre-investment valuation of £25 million GBP.

Investors were quick to capitalise on the opportunity following the company’s confident start to 2022, with an expansion into new territories and the acquisition of several smaller competitors: Helm, Barqo and Beds on Board. The initial goal was £750,000 GBP but the target was smashed by over 400%.

Although Borrowaboat has not gone public on the stock exchange, this round of crowdfunding was offering, at the outset, £750,000 GBP in exchange for 5.40% equity in the company. The directors ended up selling 10.77% equity for the final generated amount. An IPO is planned for later this year or early 2023 where the pre-money share price of £0.2437 is likely to be blown out of the water.

The securities offering was Enterprise Investment Scheme (EIS) qualified, the UK Government backed incentive that offers tax relief to individual investors purchasing stocks in a company, and also approved for secondary transactions – allowing the shares to be resold to investors further down the road.

Borrowaboat have succeeded in asserting dominance over the yacht charter market due to several key factors. Primarily, their strong online presence and brand has been integral in their strategy to establish themselves as the go to website for boating holiday makers and boat owners alike.

This financing round will only further their capacity to maintain that position. The internet has become a fierce proving ground especially for burgeoning young businesses and Search Engine Optimization (SEO) and social media costs are an increasing burden.

Relying on a dedicated central hub for a business’s trade saves on many overheads increasing bottom line and therefore resilience during uncertain financial times. The Amazon marketplace is a good example of how this idea can be put into practice.

The finance raised is said to be used to expand into further new markets: Germany, Spain and France before the end of the year following their dedicated US division of the company’s website in 2020. A unique marketing strategy will be employed for each new country.

Looking to the Future

All forecasts suggest technology will only continue to play an increasing role in the day to day lives of the global population. Being at the crest of the wave, as Borrowaboat have proven to be, puts them in a strong position for future success – having achieved booking revenues in excess of £1 million GBP for the first time in company history. And from a consumer point of view, boating holidays are seen to be more accessible, more feasible than before, so the future is looking bright.

Sarah

I am an experienced journalist, writer, and editor with a passion for finance and business news. I have been working in the journalism field for over 6 years, covering a variety of topics from finance to technology. As an author at World Stock Market, I specialize in finance business-related topics.