Online travel app Traveloka announced that it had raised $250 million to strengthen its balance sheet, following the COVID-19 pandemic that has badly impacted the previously thriving travel and tourism sector. Traveloka only stated that the funding round was led by a global financial institution that holds ‘a strong vote of confidence in the company’s resilience and viability of regional travel industry’. Some existing investors also participated in the round—EV Growth included and the rest unnamed. The capital injection is also expected to boost efforts to deepen Traveloka’s offerings in select priority areas, including building a more robust and integrated travel & lifestyle portfolio in key markets. The company will also expand its financial services solutions to provide better support to its ecosystem partners.
Traveloka said in its statement that it had witnessed a historic drop in business activity, with its partners across transport, accommodation, attractions, and dining experienced significant disruption to their business. Transportation partners saw soaring refund requests, hotels experienced all-time low occupancy rates, and several domestic & regional activities and dining partners had to shut down due to high uncertainty temporarily.
“Without a doubt, Traveloka has been profoundly affected by the COVID-19 pandemic. We have experienced the lowest business rate that we have ever seen since our inception. However, we always believed that the company would prevail by rapidly adjusting our strategy, working with our industry and ecosystem partners, as well as continuing to innovate for our users, our ultimate focus,” stated Ferry Unardi, cofounder and CEO of Traveloka.
Confident that the sector will get back to its feet again and come back stronger, Traveloka has implemented necessary business optimization measures to conserve capital and refocused its effort entering the new normal.
Now that lockdowns have eased and people begin to embrace living responsibly with the pandemic, Traveloka has seen a resurgence of bookings on domestic, short-distance travel and activities in several markets in Southeast Asia. Ferry said that the business is approaching its steady pre-COVID-19 level in Vietnam, and about to surpass 50% in Thailand. And while Indonesia and Malaysia are still in the early stage of recovery, there is a steady week-to-week improvement, especially in the accommodation segment which is boosted by the rising trend of a short-distance staycation.
Therefore, Traveloka is launching more initiatives that can adapt to customers’ needs in such situations, such as offering COVID-19 test bundle with flights, a flexible open-dated voucher for hotels, online experience programs, to name a few.