New «per seat» concept is gaining popularity with Bizav
JetSmarter is a members-only mobile community for shared and private flights. The company is headquartered in Fort Lauderdale, Florida. Using proprietary mobile algorithms, the JetSmarter app connects members to more than 3,000 aircraft and existing routes across three continents – the United States, Europe, and the Middle East. Plus, its members have the ability to create flights virtually anywhere on the globe and share them with other members or book all the seats to make it private.
Now the company is offering shared charter and shuttle flights, the latter on about fifty routes in the U.S., Europe, and the Middle East, helping to resuscitate the per-seat concept, which had been declared dead several times since its arguably premature birth in the last decade. Like some other charter providers with novel business models it has been the subject of a good deal of skepticism. But it could be that technology and today’s “shared” economy ethos have dramatically expanded per-seat’s potential.
To join, the clients pay an annual membership fee of $15,000 or $50,000. The latter amount buys you discounts and greater access to seats on flights, among other perks. There is also a $2,500 initiation fee, plus the costs of whatever services beyond free shuttle flights you use. Today, about 8,000 people are onboard of this program.
JetSmarter’s per-seat offerings have drawn the most attention among its charter services. The logic is simple - instead of one person paying for the service, the price is divided among several individuals, reinforcing basic economic principles of savings vs rewards. Per-seat charter skeptics have always contended that the business model cannot succeed because sharing a cabin with strangers is the antithesis of one of charter’s chief calling cards: privacy. It has been assumed that business jet travelers would never submit to sharing cabins.
However, so far JetSmarter seem to be attracting customers. Perhaps one of the reasons for success is that some travelers face the alternative of an airliner cabin with even more strangers, albeit in business- or first-class, along with security lines and searches. If that is the other option, sharing a business jet might not seem so bad.
Meanwhile, the number of investors in the company is growing. Last August, Clearlake Capital Group and Leucadia National Corporation, both multibillion-dollar investment funds, signed on with JetSmarter, bringing the total raised to “upwards” of $200 million. Other investors reportedly include the Saudi royal family, rapper and businessman Shawn “Jay Z” Carter, and Goldman Sachs Capital Partners.