Singapore's Velocity Ventures launches travel fund
Velocity Ventures, a Singapore-based VC firm focused on travel and hospitality, has launched its debut early-stage fund targeting Southeast Asia with a target of $20 million.
The firm hopes to leverage a return to growth in the sector post COVID-19 by supporting strategic pivots, financial restructurings, and start-ups that are facilitating digitization. It has flagged improving sentiment for travel in recent weeks and expects to close the fund in January 2021 with much of the LP base comprising regional strategic players.
Velocity was founded last year by Patrick Imbardelli, ex-CEO of the Pan Pacific Hotels and InterContinental Hotels Group, and Nicholas Cocks, CEO of Singapore-based investor ReadyVentures.
“The current structural change in consumer behavior is a game-changer as it will not only create new forms of opportunities within the travel and hospitality sector but will also drive the sector to develop transformative tech-driven solutions – which has largely been lacking in the industry,” Imbardelli said in a statement, referring to how he expects the sector to make a comeback despite the ongoing pandemic.
Velocity anticipates that travel and hospitality will take up to three years to recover and a return to pre-COVID levels of 5.5% growth. Food and beverage (F&B) is already seen as being in the recovery phase while air and business travel are expected to take longer. The varied recovery profile will inform investment across core areas, including retail, entertainment, transportation, accommodation, travel services, and F&B.
Velocity aims to distinguish itself through a specialized corporate partnerships network, which currently includes airlines Lufthansa and Etihad Airways. AVCJ understands the firm is also in talks with the likes of Hilton, Rosewood Hotels, and Jollibee for the program, which would provide portfolio companies with mentoring support and piloting opportunities.
Deal sourcing will be supported by collaboration with regional start-up organizations including a tourism accelerator operated by the Singapore Tourism Board, Plug and Play APAC, and Malaysia Digital Economy Corporation.
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