Half a unicorn
NOTE: The below originally appeared as the editorial in our November 17 One Minute Week newsletter. To find out more, and sign up for free, please click here.
Being sceptical is not a bad thing. Airshows need polemists as well as cheerleaders.
When NBAA was last in Las Vegas, Kenny Dichter was busy doing one of the things he does best. Selling.
Dichter said Wheels Up was going to become the biggest brand in aviation and that it was going to open up business aviation. Many were sceptical. As one competitor said at NBAA 2013: “Kenny and his guys can sell, but do people really want to fly on a King Air?”
At NBAA 2013, Wheels Up had zero aircraft and zero customers. Two years later it has almost 2000 members (including about 200 corporates) and 50 aircraft.
Others were sceptical about membership. Wheels Up sees itself as a subscription – like Netflix or Amazon Prime – rather than a traditional charter company. And it has plans to add extra subscription levels.
As well as getting customers, Wheels Up has also attracted new investors to the industry. In September this year, T. Rowe Price Associates, Fidelity Management, NEA and some new and existing investors agreed to an investment of up to $115 million, valuing the company at more than $500 million. This means that it is the first business aviation to get halfway to being a Unicorn (the new term for a $1 billion privately owned company).
Dichter says Wheels Up will have around 3,500 members by next year’s NBAA and 10,000 by NBAA 2020. Few are as sceptical now.