White Paper v3.0

October 2019

Executive Summary

Founded in 2017, Travala.com has grown from a small start-up to the world’s leading blockchain-based travel booking platform trusted by thousands of customers worldwide as their preferred online travel agency. 

At Travala.com, we connect travellers with one of the world’s largest selection of incredible places to stay, including everything from hotels, apartments, villas and hostels to 5-star luxury resorts. The Travala.com platform currently offers 1,654,357 properties covering 90,124 destinations in 230 countries and territories, and with prices up to 40% cheaper than mainstream travel booking platforms.

We have successfully created a frictionless travel booking experience that incorporates next generation blockchain technology and tokenised incentives. By introducing cutting edge user experience and multiple cryptocurrency and traditional payment options alongside benefits tied to our proprietary cryptocurrency AVA, our customers know they are booking with a platform of the future with transparent pricing and backed up by our Best Price Guarantee. 

The Travala.com value proposition is bolstered by AVA. As the native cryptocurrency of the platform, AVA can be used for payments, receiving and redeeming loyalty rewards, refunds, and as a store of value, among several other use cases.

Founded by a team of seasoned travel, fintech and blockchain industry experts, Travala.com’s mission is to bring to the travel industry as a whole transparent pricing, innovation, authentic truth, enhanced security, and efficient stakeholder interaction.

Travala.com’s vision is to align travel booking with the ethos of decentralised technology. That being, promote accessibility to anyone, anywhere, offer censorship resistant and peer-to-peer transactions, and build open-source technology controlled by software and governed by users.

Travala.com achieved significant accomplishments with the first version of its platform launched in January 2019. The following is a snapshot of some key metrics:

With the implementation of more advanced blockchain functionality and cryptocurrency use cases on the way, Travala.com’s future is a bright and exciting one.

The Problem

The online travel booking model was revolutionary when it arrived over 20 years ago, but in its current form is outdated. The problems have been well hidden, but noticeable cracks are beginning to appear. The problems and their causes are outlined below:

  • Have lower margins.
  • Suffer reputational impact.
  • Rely on industry’s review systems.
  • Are unable to provide a customized, innovative booking experience.
  • Can’t offer effective loyalty programs.
  • Can’t offer a wide variety of payment options.
  • Pay higher prices than they should.
  • Are offered false discounts.
  • Can’t trust the majority of reviews.
  • Less than ideal booking experience.
  • Can’t easily redeem rewards and/or value.
  • Suffer from limited payment options.
  • Booking platforms enforce price parity agreements, so even for direct-to-consumer sales, hotels must stick to the same mark-up rate (15%-35%) as advertised on the booking platforms. With price parity agreements, hotels can’t offer consumers the rates they want.
  • Booking platforms regularly force hotels to mark-up pricing to artificially high rates. Consumers are then offered marked-down pricing to give the illusion of savings. This results in hotel reputational damage by what appears to be desperation discounting, and consumer reluctance to pay full rates in the future.
  • Travel experience reviews are primarily motivated by negative experiences (most travellers have positive experiences but are not incentivized to leave reviews). Additionally, the concentrated ownership of booking platforms extends to many leading review websites and travel blogs, which leads to review bias.
  • Existing booking platforms are primarily focused on fine-tuning their marketing engines. The billions of dollars spent on paid advertising and subsequent optimisation of ad spend means technology innovation is secondary. Few booking platforms are investing in the rapidly growing blockchain and cryptocurrency space.
  • Booking platforms that provide loyalty programs carry outstanding rewards as liabilities on their balance sheets, meaning they aren’t incentivized to actually honor them. In this model, further travel spending is disincentivised because consumers end up with fewer redeemable rewards.
  • Booking platforms are not innovating to offer more payment options. Consumers can’t book travel with cryptocurrencies such as Bitcoin as only traditional payment options are available. Because of this Booking platforms are losing business.

The success of disruptors such as Airbnb show that consumers are ready to migrate to platforms which empower more reasonable pricing, allow smaller suppliers to compete more freely, and make more relevant the impact of user reputation and trustworthy reviews (Gretzel & Yoo, 2008).

The rise of the internet allowed online travel booking platforms to dramatically change the market but decentralised technologies built on public blockchains are set to change it again.

The Solution

For Travala.com to successfully launch decentralised technologies capable of solving the problems endemic to the travel industry, we had to start with solid corporate fundamentals. These fundamentals include building a recognised brand, hiring a world-class team, acquiring a robust user base, developing cutting edge technology, and finding product-market fit.

Travala.com has received ample market validation so now is the time to move towards an evolution in online travel booking that will fundamentally change the relationship between consumers and their travel service providers.

Revolutionary decentralised functionalities and use cases will be rolled out, and they will complement an ever improving travel booking experience made possible through the traditional centralised model. Going forward, the previously-identified problems for hotels and consumers can be addressed in both a centralised and decentralised manner as follows:

  • Receive a commensurate proportion of the booking fee for the service they provide.
  • Can implement rational pricing which is representative of their service and brand.
  • Benefit from a review and content contribution system with properly-aligned incentives.
  • Benefit from reaching new customers and sales channels without risk.
  • Can leverage tokenised loyalty rewards
  • Pay a fair price for the service they receive.
  • Can evaluate whether or not to buy based on truly fair prices.
  • Can trust 100% of the reviews and content.
  • Can customise their booking experience.
  • Can spend, earn and convert rewards without friction.
  • Hotels and consumers have full visibility on the true cost of travel services through an immutable, shared blockchain ledger. Travala.com takes a fair commission for the service offered.
  • Travala.com’s straightforward pricing model means consumers are no longer deceived by false discounts, enabling them to evaluate more clearly each service provider’s offering.
  • Users are incentivised to write reviews for confirmed bookings on Travala.com. Reviews are scrutinised for accuracy while the number of community upvotes and downvotes determine relative seeding of reviews.
  • Consumers are offered a range of payment options including popular cryptocurrencies and traditional methods. Suppliers have no exposure to underlying currency exchange rate volatility.
  • Travel service providers get access to a unique customer base that is incentivised to make future bookings through Travala.com’s one-of-a-kind loyalty program.
  • Consumers are able to book travel services free of any central authority (peer to peer). Property owners complete their listing and set rates as they see fit.
  • Data analytics are applied to decentralised data stores in order to suggest optimal room rates based on comparable properties.
  • A decentralised review platform governed by a consortium of booking platforms can incentivise trustworthy review writing at scale. Ownership of the reviews stays with the consortium, and it would be a copyright violation for others to use them.
  • Property owners have complete flexibility and customisation options including whether they will accept cryptocurrencies.
  • Property owners can implement customised loyalty rewards such as cashbacks or unique marketing promotions using tokens with real value.

*In the sections below, each of the centralised and decentralised solutions will be explained in more detail.

The Market

Overview

Travala.com is operating in the fast-growing, rapidly-evolving travel and tourism industry. The global travel and tourism sector grew at 3.9% year-on-year to contribute a record USD $8.8 trillion to the world economy in 2018 (Travel & Tourism, 2019). For the eighth consecutive year, this was above the growth rate of world GDP. More specifically, within travel and tourism, the online travel booking market is also witnessing rapid growth as more trips are being booked online than ever before. It is estimated that this market will achieve global revenue of nearly USD $2.0 trillion by 2026 (Global Online Travel Booking, 2018).

The online travel booking boom is showing no signs of slowing down. In fact, it is entirely possible that this market grows faster than projected as newer and better booking options and platforms continue to gain consumer acceptance. Decentralised platforms that can solve many of the problems with status quo booking platforms have the potential to accelerate growth in the industry.  

Broad market trends are revealing that now is the time to undertake decentralised initiatives. The trajectory of the digital age is showing us users are moving away from fully centralised platforms (Web 1.0) to new alternatives. Centralised peer-to-peer marketplaces (Web 2.0) have witnessed rapid growth over the past decade, but these too are showing signs of user dissatisfaction brought on by market inefficiencies. The next stage of digital growth will come from fully-decentralised peer-to-peer ecosystems (Web 3.0). 

There is no telling the size of market Travala.com can capture with our existing platform and/or create with our soon-to-come decentralised peer-to-peer ecosystem. One thing is for sure, Travala.com is not looking for a small fraction of the Web 1.0 or Web 2.0 market. We are set on being a dominant player for the next-generation online travel booking companies in the Web 3.0 environment.

Target Markets

Travala.com is a challenger in the highly-competitive online travel booking market. One of our unique advantages is that we appeal to a growing, high-value user base that remains neglected in the travel booking market so far: namely blockchain and cryptocurrency enthusiasts.

As evidenced by the chart below which shows the quarterly increase in digital wallet users, this is a fast-growing market segment.

Technology adoption curve theory suggests we are still in the early-adopter phase of a technology that is likely to have as profound an impact as the Internet itself. We anticipate this market will continue its rapid growth. 

Blockchain and cryptocurrency enthusiasts are a consumer demographic which is perfectly pre-filtered for the travel market and whose make-up helps transcend many of the difficulties in consumer acquisition and marketing outreach. 

Research on cryptocurrency holders reveals that millennials are the primary demographic (Bogart, 2019). Research on the behavioral characteristics of millennials, meanwhile, demonstrates they are more open to new brands and services than older generations (“Millennials,” 2017) and more likely to travel (“Stats: Millennials To Travel,” 2017).

Further, cryptocurrency enthusiasts have been shown to skew towards highly educated, tech-savvy, and future-oriented demographics (“How Many People,” 2018). The people in these demographics, in turn, are proven to be more likely to travel in order to expand their horizons (“The Value of Travelling,” 2016). 

Blockchain and cryptocurrency enthusiasts are also highly-invested in the adoption of cryptocurrencies in mainstream business activity. Their emotional investment in the success of cryptocurrencies, which is often based on staunchly-held shared world-views such as libertarianism, can supersede a typical person’s inclination to follow the path of least resistance. In other words, cryptocurrency enthusiasts represent the ideal group of early adopters for the unique product offered by Travala.com.

Because of their dedication to the growth of the ecosystem, cryptocurrency enthusiasts typically form communities where they interact with others who share similar values. These communities usually have open-lines of communication with the businesses they support, and knowledge exchange is expected. In exchange for operational transparency, passionate community members have been known to support marketing efforts by lending time and energy as content writers or community ambassadors. They typically help with product development through testing and feedback, and some supporters even offer their skills as developers. 

It is safe to say the blockchain and cryptocurrency world is uniquely invested in the success of the businesses they support. Therefore, we view the leveraging of this community as a powerful advantage for Travala.com. However, we have not lost sight of the bigger picture: global commerce is still mainly conducted in fiat currencies by people unfamiliar with cryptocurrencies and the potential of disintermediation through decentralisation. Given this, Travala.com still provides consumers with major traditional payment options such as credit cards, and a familiar online booking experience. When onboarding customers unfamiliar with blockchain technology, Travala.com will always share the benefits of this technology in an effort to grow the ecosystem. This represents a unique opportunity to build our brand and develop loyalty.

Travala.com is appealing to all travelers because it offers better prices and it has a familiar user-experience.

Travala.com is uniquely positioned to bypass the traditionally long and expensive consumer acquisition journey by tapping directly into a consumer demographic which is willing to go above-and-beyond to contribute to the success of the business itself. Secondly, our strategy to convert a demographic unfamiliar with blockchain technology into loyal users represents a significant untapped opportunity.

The Platform

Visual Overview

Architecture Summary

  • Modern JavaScript front-end application written in AngularJS with Socket.io for streaming real-time updates.
  • Python, NodeJS, and Java backend technologies structured in a microservices architecture for service isolation and easy scaling.
  • iOS and Android apps built in React Native for rapid development and responsive improvements based on customer feedback.
  • Cloud hosting in AWS for automatic horizontal scaling, instance management, deep stack monitoring, and innumerable other benefits provided by the AWS ecosystem.
  • Cloudflare CDN and Firewall for network edge optimizations and DDOS protection.

Mobile Application

As a compliment to the Travala.com desktop platform, we are creating the ultimate mobile travel booking application. Available on both iOS and Android, the Travala.com application will offer users the best experience on their mobile device by incorporating intelligent design and offering enhanced functionality.

In line with industry trends, we anticipate the mobile app will soon become the primary point of engagement for our users. The app is built on the four pillars that comprise our technology framework. These are: (1) smart, (2) omni-channel, (3) open APIs, and (4) modular architecture.

In the future, Travala.com will add the following pioneering technologies that not only support our decentralised vision, but also improve the Travala.com experience.

Travala.com Digital Wallet v2.0

Digital wallets form the backbone of the Travala.com AVA token economy. Once the new Binance Chain based wallet is deployed on Travala.com it will allow the following functions to be completed on-chain, thereby providing full transparency of transaction activity:

  • Cryptocurrency deposits
  • Cryptocurrency withdrawals
  • SMART Program lockups
  • Givebacks
  • Loyalty rewards
  • Cryptocurrency refunds.

Refunds have particular significance in this context. In the travel and tourism industry, free cancellation or refundable bookings are standard. This is easy to manage with traditional online payment options like credit cards. In the cryptocurrency environment, however, this is not as simple because transactions cannot be reversed.

We have come up with an innovative solution to the cryptocurrency refund problem. Travala.com will use a BEP2 stable coin as the payout currency for all refundable bookings.

If a traveller pays for their refundable booking with any cryptocurrency and they decide to cancel, they will be refunded the equivalent value of their booking in the stable coin directly to their Travala.com in-built platform wallet.

Travala.com Digital Wallet v3.0

If a user wants to self custody rather than have Travala.com manage their private keys, they can create their own local wallet and then register the public address with their Travala.com account in the website. In this scenario, when a user earns rewards, Travala.com will send cryptocurrency directly to their own wallet rather than to the Travala.com hot wallet.

If a customer wants to stake AVA for the Rewards Program in their own wallet, they must sign a transaction that freezes their AVA while additionally informing Travala.com of the transaction ID of the freeze. Before issuing discounts or rewards, Travala.com will confirm by checking on the blockchain that the funds are still frozen.

IPFS

The InterPlanetary File System (IPFS) is a decentralised file storage system. With IPFS, every file is referenced by its Content Identifier (“CID”), which is a unique hash of the file it represents. This means that every file in IPFS is tamper-proof, immutable, and referenced by a hash rather than a URL (as in the status quo).

The hash that represents each IPFS item can easily be stored in the memo ID field of a transaction on the Binance Chain. Travala.com will use this technique to associate otherwise arbitrary data on the blockchain, thereby ensuring the data cannot be manipulated by an attacker. IPFS plays a key role in our leading edge decentralised booking and review platforms, which we cover in more detail below.

Freeze / Unfreeze Transactions

Binance Chain has the ability to freeze and unfreeze assets per public address. This functionality can be used for staking and lockups, as we can tie actions in the system to those events. We can also have users prove ownership of addresses by cryptographically signing messages.

The Travala.com Blockchain

Binance Chain is an innovative blockchain that already provides many of the features necessary for Travala.com’s decentralised future. However, as we progress our decentralised initiatives, we will evaluate whether Binance Chain is able to fulfill all of our technical requirements. 

If not, Travala.com will build its own blockchain on the Cosmos network to fully implement its decentralised vision. This will integrate seamlessly with Binance Chain to extend and enhance the utility of our native token AVA through easy transfers between Binance Chain and the Travala.com Blockchain.

Cosmos is a third-generation blockchain platform that improves on generation one (Bitcoin) and generation two (Ethereum) blockchains in several ways. Of particular significance in our context are the following:

  • Bitcoin and similar blockchains are only capable of transferring funds.
  • Ethereum provides a sophisticated platform for decentralised applications, but for the foreseeable future is limited by its lack of scalability.

Cosmos solves the scaling problem by making each decentralised application its own blockchain. This allows each decentralised application to scale independently. It also enables the customization of each blockchain for its specific use case. Each decentralised application is considered a “Cosmos Zone.” Both the official Cosmos blockchain (“Gaia”) and Binance Chain are Cosmos Zones.

Cosmos has far higher customization potential and throughput than the current implementation of Ethereum. Cosmos accomplishes this via Proof of Stake (PoS) consensus, and is the first PoS platform that has implemented a consensus algorithm in a truly equitable way. 

In Cosmos, anyone can become a block producing node by staking more than the least-staked node. Currently Cosmos supports up to 100 nodes but the roadmap calls for 1,000. No other PoS blockchain has delivered working code with such a level of decentralisation. A higher node count is important because blockchains with a limited number of nodes are more susceptible to collusion from bad actors. 

Every decentralised application (Cosmos Zone) is its own blockchain. Application developers can choose one or more currencies to be their native staking currency, and they have the capacity to set different fees for each currency. The Cosmos SDK provides many features out-of-the-box, including staking, governance, identity/accounts, Ledger hardware wallet support, non-fungible tokens, and more. Decentralised application developers can pick and choose which features they want from the Cosmos SDK, and then create their own modules to enhance and extend those features.

Business Model

Booking Commissions

The Travala.com business is driven by booking commissions generated from properties aggregated via strategic partnerships with world-leading travel suppliers such as Priceline, Hotelbeds, Webbeds, Ctrip and many more. This is currently the largest source of revenue for Travala.com. Our commission fees currently average 10% of the booking value. As mentioned previously, this is on average 15% cheaper than mainstream travel booking platforms.

Direct Contracting Program

Starting in early 2020, Travala.com will initiate a Direct Contracting Program (DCP). Through the DCP, properties will be added to Travala.com under contractual agreements that give Travala.com more control over room rates and availability. By having control, we can maximize booking margins by removing fees paid to third-party travel suppliers. Another benefit to the DCP model is that we are able to build direct relationships with property owners. These relationships are important for knowledge sharing and customer feedback which, in turn, can improve the Travala.com platform. 

The pilot DCP will be first implemented in Vietnam with the intention to replicate it thereafter in several other countries. As we develop our decentralised technology, we will explore different incentivisation mechanisms that encourage properties to sign up directly to our DCP. We also envision the creation of a global Decentralised Salesforce assisting Travala.com with our DCP, as covered in more detail below.

Other Business Models

Besides booking commissions, Travala.com has ancillary revenue models that  presently account for a relatively small proportion of revenues, but show high growth potential. These are:

  1. Listing fees. Fees are taken from cryptocurrency projects and/or foundations who want their cryptocurrency made available as a payment option on Travala.com. 
  2. Advertising (TravalAds). Direct marketing opportunities are available to travel suppliers and strategic partners. Costs depend on a number of factors such as ad placement, size, type, and more. 

Travala.com will introduce flight, rental cars, transfers and activity bookings in 2020, as they are complementary to our existing offering and will put Travala.com on a level playing field with the product offerings of status quo booking platforms.

We envision a future where consumers can book their full suite of travel needs exclusively on Travala.com.

Travala.com is currently experimenting with booking optimization tools that will improve profit margins while enhancing customer experience. Examples of such mechanisms include: 

  • OptiSearch. Reduces unnecessary queries by calculating the likelihood of buyer conversion and only then querying the top suppliers, instead of querying all active suppliers. OptiSearch leads to significantly faster response times due to reduced server loads.
  • SmartBook. Reduces sell-outs and failed bookings, boosting conversions and customer retention. SmartBook can intervene before a booking is lost by automatically booking the same product through an alternative supplier. SmartBook also searches for the best buy-rate across our hotel supplier network after customers have booked a room, thus maximizing profit margins.
  • Dynamic Pricing. This feature allows us to dynamically markup our margins according to current market conditions, instead of relying on flat rates or fixed percentages.
  • Rebooker. If the price of a booking falls after the initial reservation is made, Rebooker allows Travala.com to automatically cancel the original reservation and rebook it at the new lower cost. 

Based on our performance since launching, the Travala.com team has proven its ability to execute on delivering market-accepted business models. Alongside efforts to improve our existing business model, Travala.com will be implementing new decentralised business models in the near future.

Decentralised Business Models

Since setting out to build Travala.com we have always had the intention to decentralise aspects of the business in order to leverage the advantages of disintermediation. After meeting several internally significant business milestones, we are now planning to phase-in more advanced decentralised functionality and use cases to our business model.  

Fully decentralised technologies are still new and experimental. There are few proven use cases to benchmark against, and even fewer best practices. Because there is no real decentralised platform playbook, our approach will be to undertake incremental change with fine tuning rather than major upheavals of existing systems. We will focus on selecting the right technologies that underpin a decentralised platform, and building a community of advocates who support our vision.

Decentralised Accommodation Booking

Under a decentralised model, accommodation seekers are able to book stays without the need for an intermediary. Said another way, individuals seeking to rent an apartment, bedroom, or hotel room can deal directly with the property owner. In this case, Travala.com will act solely as the technology provider to facilitate bookings. Our key responsibilities will include: 

  • Providing tools for security and data ownership such as user reputation, trust mechanisms, and dispute mediation; 
  • Governing AVA supply, incentives, and rewards;
  • Developing the community and offering developer tools to assist with new platform developments. 

The business model for a decentralised Travala.com still includes commission fees, but at a lower percentage of the booking value than currently. The benefit for travellers is a lower cost, more transparent, more customized booking experience. 

The benefits for property owners are more control, improved transparency, less fraud, and lower fees. Decentralised bookings are a large divergence from the approach taken by existing peer-to-peer travel booking marketplaces, but we believe the market is ready to accept such an offering.

Decentralised Salesforce

To support our decentralised business models, we envision the creation of a globally distributed and decentralised salesforce incentivised by tokenised rewards to help Travala.com achieve the global scalability needed with its Direct Contracting Program (DCP). 

Similar to how Uber expanded their workforce through low-friction onboarding of service providers (drivers), we will empower independent agents to expand our DCP network without growing our salaried employee costs. Over time, this will potentially save us billions of dollars in overhead costs. 

Anyone, anywhere in the world will be able to participate in this program to earn a possible lifetime revenue stream, paid in the form of AVA. Earnings are based on a percentage of the total revenue generated from the accommodation partner on the Travala.com platform. A onboarding process will be required to both vet the quality of participating individuals and set them up for success. 

The Travala.com Decentralised Salesforce will help us compete in fast-growing travel accommodation markets against status quo platforms which already have millions of directly contracted properties listed.

Decentralised Reviews

Verified reviews are a valuable commodity in the travel and tourism industry. Certain platforms within the space are charging tens of thousands of dollars per year just to license the right to use the reviews they’ve compiled. The value of compiling reviews is clear. More than 80% of TripAdvisor users, for instance, make decisions based on the reviews they read (“Eighty percent of TripAdvisor users,” 2014). 

However, status quo review systems are notoriously inadequate. An inability to solve the identity problem combines with improperly designed incentives to result in rampant fake reviews or reviews that are negative-only. This is evidenced by, for instance, a BrightLocal consumer review survey which found that 75% of consumers believe they have read a fake review in the last year (Murphy 2018).

The importance of a genuine verification system and adequate economic incentivisation for well-intentioned reviewers cannot be understated. Thankfully, by leveraging decentralised technology under a Booking Platform Consortium model, a way to create such a system is now possible.

With such a model, Travala.com can lead the way in creating the technology that incentivises users to write thoughtful reviews (by allowing them to generate earnings from the reviews), and preventing non-Consortium members from freely using the reviews to their benefit.

At first, Travala.com would be the only member of the Consortium. Business development efforts would target similar-sized and like-minded travel booking platforms. Under this model, the ownership of the reviews stays with the Consortium, and it would be a copyright violation for others to use them. 

To start, we would lend the existing reviews already compiled on Travala.com to the new review platform. Once others join the Consortium they get the right to use existing reviews and submit new reviews. To join the Consortium, travel booking platforms will do the following:

  • Submit a one-time payment to all Consortium members, with the payment split in proportion to the percentage of reviews submitted by each member. The first five Consortium members join free of charge. 
  • Lock-in a staked position in AVA which must be purchased on the open market. The first five Consortium members get an early-stage discount.  
  • Destroy 10% of their staked AVA position every year as a fee to maintain membership.
  • Platinum Members are the only ones who get full rights to use the reviews how they see fit. This protects Travala.com’s search engine optimisation while still giving booking platforms a cheaper way to get reviews. Platinum Memberships are priced on an ad-hoc basis.

Decentralised Referral System

Affiliate marketing always requires the vendor to be honest and report affiliate earnings correctly. While a decentralised referral system wouldn’t completely eliminate the need for affiliates to trust Travala.com, it would at least enhance the transparency of the payout system. Further, since payments themselves can be made using cryptocurrencies, there is the benefit of vastly reduced transaction fees, particularly for cross-border payments.

Travala.com will track registrations of users who were referred by affiliates, then pay affiliates a percentage of the commission earned through bookings from the customer for a duration of five years. Once a month, bookings and affiliate earnings are uploaded to the IPFS to create an immutable record of who got paid, why, and when.

Decentralised Governance

Any parameter of the Travala.com blockchain software can potentially be made modifiable, with holders of AVA given voting rights on select governance issues relating to the platform. For example, a percentage of every booking could go into a community fund, with AVA holders voting on proposals for how to spend the funds. Proposals could include marketing, development, or anything else that is relevant

It is also possible to let the network vote on more fundamental parameters such as the percentage of commission charged to travel suppliers, or the number of AVA repurchased and destroyed. Further, voting can also be used as a policing mechanism with AVA holders voting to ban properties that violate laws or are otherwise bad for the platform.

The primary advantage of decentralised governance in our context is that it improves community engagement and builds loyalty. Giving AVA holders the right to vote on certain issues empowers them, not unlike shareholders in a public company.

The ‘Billion Dollar API’

Global travel technology companies like Amadeus and Sabre are ancient with low-level APIs used by basically all OTAs either directly or indirectly via third-party APIs that resell them. Their business value is that they access an enormous quantity of product across flights, hotels, rental cars, etc., and are integrated with all major stakeholders in the industry. These APIs are used because they are unified and reliable. Their purpose is to ensure everyone speaks the same language to each other, and to mediate contract disagreements.

Disrupting these entrenched APIs is extremely difficult. However, if it can be done at all, the most likely usurper will be one that is built on decentralised technology. If Travala.com can create a protocol that allows each industry stakeholder – airlines, hotels, car rentals, other travel-adjacent businesses, and consumers – to interact directly, and to do so using a unified protocol (API) that is enforceable directly on the blockchain, then there will no longer be a need for intermediaries like Amadeus and Sabre. 

With enough traction from the early-adopters who take advantage of the lower costs enabled by disintermediation, a tipping point would be reached where industry stakeholders switch en masse to the new platform. In this scenario, the value of a common cryptocurrency would increase along with its utility.

The Travala.com Blockchain, therefore, could be the technological advancement that finally disrupts the entrenched APIs, thereby adding billions of dollars of Total Addressable Market to Travala.com and increasing its potential future valuation.

The AVA Token

Overview

With the introduction of AVA into the business model, the incentive to use Travala.com becomes significantly stronger. On top of Travala.com’s existing strengths, the addition of AVA provides additional benefits and enhanced user engagement. 

AVA features front-and-centre in our unique selling proposition to users. It can be used as an additional method of payment for bookings, or as the sole payment method for special offers. It can be staked for access to enhanced rewards, or directly recouped for the equivalent fiat value on partner exchanges.

We are currently in the process of migrating AVA from a NEP5 (NEO blockchain standard) to a BEP2 standard token, the token format native to the Binance Chain. 

AVA’s functionality makes it critical to the success of Travala.com. The interplay of AVA use cases is designed to encourage loyalty to the Travala.com platform while increasing distribution and liquidity of the token.  Each functional aspect of AVA is covered in more detail below.

Payments

Users can pay for bookings using AVA which can be purchased directly from the open market or obtained from Travala.com’s rewards and invite programs. Key benefits of paying with AVA are that users get special discounts, and it reduces transaction costs and settlement times. Additionally, as part of the SMART Program, users can access enhanced tiered rewards on their payments.

Givebacks

Every time a booking is completed on Travala.com, the traveller gets 2% of the total booking price back in AVA. This is critical for putting the cryptocurrency into the hands of the masses.

SMART Program

AVA rewards can either be saved towards a future booking or be used in the SMART Program. By locking AVA into the SMART tier of their choice, members are eligible to receive the corresponding discount and cashback. The more AVA a member locks up, the greater their rewards. Each member taking part in the SMART Program is required to lock their AVA for a minimum of 30 days. The tiered amounts of AVA to be held are as follows:

Amount of AVA
You will need to lock up 500 AVA to activate this first level of the Smart Program

SMART Discount
Get a 1% discount from bookings made on the platform. The discount will be applied directly to the listed prices on the platform.

SMART Loyalty 
Get a 2% loyalty reward for bookings made on the platform. These rewards will be paid directly to your wallet in the AVA token.

Amount of AVA
You will need to lock up 1000 AVA to activate this first level of the Smart Program

SMART Discount
Get a 2% discount from bookings made on the platform. The discount will be applied directly to the listed prices on the platform.

SMART Loyalty 
Get a 2% loyalty reward for bookings made on the platform. These rewards will be paid directly to your wallet in the AVA token.

Amount of AVA
You will need to lock up 2500 AVA to activate this first level of the Smart Program

SMART Discount
Get a 3% discount from bookings made on the platform. The discount will be applied directly to the listed prices on the platform.

SMART Loyalty 
Get a 3% loyalty reward for bookings made on the platform. These rewards will be paid directly to your wallet in the AVA token.

Amount of AVA
You will need to lock up 4000 AVA to activate this first level of the Smart Program

SMART Discount
Get a 4% discount from bookings made on the platform. The discount will be applied directly to the listed prices on the platform.

SMART Loyalty 
Get a 4% loyalty reward for bookings made on the platform. These rewards will be paid directly to your wallet in the AVA token.

Amount of AVA
You will need to lock up 5000 AVA to activate this first level of the Smart Program

SMART Discount
Get a 5% discount from bookings made on the platform. The discount will be applied directly to the listed prices on the platform.

SMART Loyalty 
Get a 5% loyalty reward for bookings made on the platform. These rewards will be paid directly to your wallet in the AVA token.

AVA Repurchasing Plan

Travala.com’s AVA Repurchasing Plan will take place every quarter until 21,571,086‬ AVA are permanently destroyed. This represents 35% of the total supply (the starting supply is 61,571,086 AVA), reducing the overall total supply to 40,000,000 AVA. The amount of AVA to be repurchased each quarter is determined by Travala.com’s booking activity.

The first repurchase event will take place in mid-January 2020. The number of AVA repurchased and burned will be determined by the booking activity from July 1, 2019 to December, 31 2019. Once each repurchase is finished, we will share the details via our official social channels and blog in the form of a Repurchase Report. Transactions will, of course, be publicly viewable on the blockchain explorer.

Best Price Guarantee

To ensure that consumers always get the best price on bookings, Travala.com will match any competitor’s price. If a traveller books accommodation on Travala.com and finds a cheaper price somewhere else, they can claim a refund for the difference up to 24 hours before the check-in date at the property. This refund will be paid in AVA directly to the traveller’s Travala.com wallet.

INVITE Program

People can refer friends and family members to Travala.com and get rewarded for doing so. When the referral makes a successful booking, they receive a USD $20.00 reward in AVA. The referer also receives USD $20.00 in AVA for every invited friend that completes a booking.

Review Rewards

Rewards are also given to all travellers who leave an authentic review on Travala.com. It is only possible to submit a review on a confirmed booking, following the stay. All review rewards are paid in AVA.

TravalAds

Hotels and travel suppliers can use AVA to pay for priority seeding of their product in search results. This extends to a multitude of third-party travel-related services such as promoting tickets to the Eiffel Tower when you search for your hotel in Paris for example.

Listing Fees

Travala.com is a true champion of cryptocurrency adoption and we are constantly adding new payment options to the platform. Since January 2019, Travala.com has integrated 16 new cryptocurrency payment options. We are looking to partner with amazing projects in order to boost the adoption of their cryptocurrency and the entire market as a whole. Fees for new cryptocurrency listings are paid in AVA. We encourage you to apply to add your cryptocurrency as a payment option of Travala.com today!

The Future of AVA

AVA will be at the heart of all future use cases Travala.com is pursuing. As the Travala.com consumer base continues to grow, usage of AVA is integral to their experience on the platform. With its use incentivised by valuable rewards, demand for AVA can be expected to grow in line with platform adoption, leading to the establishment of a healthy internal token economy from which all stakeholders may benefit.

Competition

Travala.com sits between traditional booking platforms and pure blockchain platforms within the online travel booking market. Travala.com’s competitive position can be further analysed as follows:

Supplier Bargaining Power
Low – Most travel suppliers are at the mercy of these platforms. Due to contractual obligations, there is limited flexibility to control prices and room availability.

Buyer Bargaining Power
Moderate – The switching cost between platforms is low and status quo loyalty rewards don’t create stickiness. However, opacity with pricing along with optimised user experience and supply options generally keeps buyers from switching.

Threat of Substitution
Moderate – Travellers are typically kept (often without knowing) within networks that are wholly owned by one of five dominant platforms . Billion-dollar marketing budgets generally ensure user acquisition for one of the dominant platforms.

Threat of New Entrants
Moderate – There is a growing number of companies looking to disintermediate and/or carve off niches from these platforms, including blockchain-based upstarts. Strategic relationships, ample supply, and marketing have so far kept most upstarts at bay.

Supplier Bargaining Power
Moderate – Suppliers have the option to avoid pure blockchain platforms if they don’t see the immediate benefits or if they face risks. On the other hand, suppliers in this category who are familiar with blockchain and cryptocurrencies have the freedom to control all economic aspects of their property.

Buyer Bargaining Power
Low – The process could frustrate a non-blockchain enthusiast. Fully decentralised platforms may have speed and scalability challenges which undermine the ability to deliver near-instant service. On the other hand, pure blockchain platforms typically offer better rates.

Threat of Substitution
High – Most platforms in this category have extremely limited travel supply. For buyers, this typically results in an instant switch to a competing platform that offers more supply.

Threat of New Entrants
Low – Pure blockchain-based travel booking platforms will likely take anywhere from 5-10 years to reach maturity. When they do, incumbents with bigger resources will embrace the technology. Until then, new entrants will have to compete against platforms with already established communities.

Supplier Bargaining Power
Low – Suppliers are receiving a new stream of business from Travala.com without any risk relating to currency exchange rate volatility. Also, there is no need for additional marketing on their part. Furthermore, suppliers are receiving above industry-average rates due to Travala.com’s ability to take lower commissions.

Buyer Bargaining Power
Low – Buyers are offered the ability to choose from 1.65M properties in 230 countries with prices up to 40% cheaper than competitors. Unrivaled payment options and rewards for taking action on Travala.com additionally encourage buyer loyalty.

Threat of Substitution
Moderate – Travala.com is still expanding its product offering to include a range of options including flights, rental cars and non-traditional accommodation. While we continue to improve our offering, there is always a risk of a user moving to substitutes which offer complete travel packages.

Threat of New Entrants
Low – Travala.com is unlike any new entrant in the market. We offer the best aspects of traditional booking platforms while pursuing the best additions as a decentralised platform.

Hybrid Approach

By taking a hybrid approach – one that combines the best of the previous generation of technology with the realistically-achievable aspects of the next generation – Travala.com is setting itself apart from the competition.

Financial Projections

Travala.com has already raised over USD $3M in funding since early 2018. Fundraising started with a crowdsale in February 2018 when Travala.com raised USD $2.6M in NEO. In April of 2019, Travala.com raised USD $500k from an equity crowdfunding campaign with Crowdcube in the UK. Since then, Travala.com has also received more investment from the NEO EcoFund in China and its founding team.  

Even though Travala.com has been operational for less than a year, our financial accomplishments to date have been impressive. For instance, Travala.com is already generating over USD $120,000 in monthly booking revenue, a figure that is growing an average of 20% month-on-month. Going forward, we expect our revenue to increase substantially in tandem with our technological improvements, global marketing strategies, and an all around better platform that boosts booking conversion rates.

Since January this year, Travala.com secured bookings for over 5,000 room nights at an average value of USD $137 per room night. With more new booking options, increased room availability, expanded booking channels, and an improved platform experience, we expect the room night booking count to significantly increase over the coming months and years. 

To meet our revenue and booking forecasts, we are budgeting for large outlays in the following categories: technology staff, paid advertisements, and loyalty programs. 

  • Technology staff, including blockchain engineers, developers, quality assurance / quality control, product managers, and user interface / user experience professionals, will both drive improvements to the current platform and enable us to pursue our strategies towards decentralisation. 
  • Paid advertising, as described below in the Marketing section, will factor heavily into our customer acquisition strategies. 
  • AVA loyalty rewards and the repurchasing plan will be a large expense as the Travala.com platform grows.

Marketing

Overview

The Travala.com community remains intrigued by the benefits of AVA and the option of booking travel using cryptocurrencies, and they represent a sizeable user base. Thanks to this passionate community of supporters, we have so far enjoyed extremely low customer acquisition costs. Going forward we know that we will have to plan for, design, and implement new marketing strategies to reach a broader audience and to grow at the pace we are forecasting. 

This doesn’t mean there will be a shift away from developing the blockchain and cryptocurrency community, as this is what differentiates us. In fact, we aim to bring improvements to the things our community members already enjoy most. Below we detail the strategies we intend to use to reach our key stakeholders which are travellers, travel suppliers, and strategic partners.

Travel Suppliers

Once our expansion limits the ability to create new deals with aggregator/wholesale travel suppliers, our approach will be to create new agreements under the DCP model.  Currently, our onboarding of new travel suppliers through either model stems from direct business development efforts. The Travala.com sales and business development team will continue pursuing new travel suppliers until we can develop a decentralised salesforce and/or affiliate model that is capable of both assisting and  leading new supply-side business development efforts.

Partnerships

Our ever growing list of blockchain partnerships and cryptocurrency payment options continues to be a distinct competitive advantage for Travala.com. By simply showcasing our existing partnerships, our efforts in forging new blockchain ecosystem partnerships become much easier. The goal here is to have partnerships with cryptocurrency foundations so leaders can trickle AVA and/or Travala.com down into their teams and communities rather than us having to target individuals.

Liquidity

We are also attempting to partner with more top-tier cryptocurrency exchanges to further improve the market liquidity of AVA.

Travellers

Travellers are the target consumer base of the platform. They will be the driving force in attracting key suppliers and partners to the platform. To date, most travellers using our platform are blockchain and cryptocurrency enthusiasts, but we anticipate a broader audience going forward. The following are some strategies we will employ to reach a new audience:

  • Referrals. Most of our existing consumers are convinced Travala.com is an appealing platform through which to book travel. We want to make it easy for them to share this sentiment with family and friends by offering rewarding referrals. So far this strategy has added new users at an appealing acquisition cost, so bolstering our referral program with additional decentralised transparency and enhanced affiliate rewards will be an important strategy going forward. 
  • Paid Advertising Campaigns.  These are primarily online advertisements with Google Adwords in the form of search and display campaigns. Since competition for prime search space from traditional booking platforms is fierce, we will carefully test and optimize our search terms to get an edge. 
  • Loyalty Rewards. Besides referrals, Travala.com also offers travellers cashback rewards on bookings and for leaving reviews. We have found that these rewards stimulate new and repeat bookings, therefore we want to make them even more appealing. However, with increased booking activity, the amount of distributed rewards will increase, as will the cost of customers redeeming rewards. 
  • SEO. This includes a combination of earned media, owned media (and optimization) and general search rank improvement. More traveller-generated content, including reviews, on an ever-increasing supply of properties will boost the search presence of Travala.com.
  • Listing on Comparison Websites / Travel Aggregators. These websites show potential bookers results from multiple websites in one place. Travala.com will apply for listings on the most popular platforms.
  • Conferences. As a partner to several leading blockchain and cryptocurrency conferences around the globe, the Travala.com team will participate both as a vendor and general attendee. Travel and blockchain conferences have been helpful for building the Travala.com brand.

Large-scale adoption and eventual commercial success of Travala.com are dependent on us bringing all three partner-groups (projects, foundations, and exchanges) together to collectively create incremental value for one another above and beyond the traditional booking platform model.

Roadmap

Travala.com will continue to forge ahead with bridging the gap between the traditional booking experience and planned next generation decentralised booking experiences. Planned technology additions will expand our competitive edge as we use them to increase customer satisfaction along with revenue and profit margins.

  • Partial migration to Binance Chain
  • Partner Network Suite
  • Digital wallet v2.0
  • Partial payments in AVA
  • Partner event module
  • Discount coupon module
  • Cryptocurrency payments for refundable bookings
  • Business and corporate accounts (B2B)
  • Dynamic pricing feature
  • Five more cryptocurrency payment options
  • Full migration to Binance Chain
  • Native mobile applications v1.0
  • Addition of airport and hotel transfers
  • Rebooker optimisation feature
  • Direct Contracting Program phase 1
  • Partner event module v.2.0
  • Implementation of email marketing automations
  • Integration of at least two more cryptocurrency payment options
  • Improved business and corporate accounts (B2B)
  • Multi-language support, including Chinese
  • Native mobile applications v2.0
  • Digital wallets v3.0
  • Direct Contracting Program phase 2
  • Sponsored hotel listings module
  • Addition of activities and tours bookings
  • Integration of at least two more cryptocurrency payment options
  • Iceland v1.0 (the first iteration of the accommodation booking dApp)
  • Addition of flight bookings
  • Addition of car rental bookings
  • Integration of at least two more cryptocurrency payment options
  • R&D Travala.com Blockchain phase 1
  • R&D decentralised homestay booking
  • R&D decentralised reviews
  • R&D decentralised referral system
  • Norway v1.0 (the first iteration of the reviews dApp)
  • R&D decentralised governance
  • R&D the ‘Billion Dollar API’

The roadmap will continue to evolve and change as we discover, experiment, and implement new user-centric improvements to the platform that broaden our appeal.

Partners

Travala.com has already established a large list of partnerships, and seeks to grow partnerships where strategically worthwhile and where mutual commercial benefit is present. Identifying key areas of competence to be reinforced through suitable partner support has been a priority focus to date. Below are the key partnerships already confirmed:

The Team

The early success of Travala.com is credited to the team of 30 individuals who are passionate about improving the way we book travel services. Within the Travala.com team are experienced professionals in blockchain development, travel, and FinTech from some of the world’s largest companies. The majority of team members are located in Hanoi, Vietnam, whereas others are globally distributed.

Our Leaders and Advisors

Matthew Luczynski – Co-Founder & CEO – Linkedin

Having worked on a number of start-ups within the travel space, with focus on bringing blockchain technology to the mass market, Matthew is responsible for overseeing Travala.com’s operations and business activities and resources, and making important corporate decisions to ensure desired results to align with the overall strategy and mission.

Steve Hipwell – Co-Founder & COO – Linkedin

With over 10 years experience in the online travel space, Steve is responsible for managing Travala.com’s day-to-day business operations. As Chief of Operations, Steve manages Travala.com’s operational processes to ensure an outstanding customer experience and that the company has all the necessary operational and financial procedures in place.

Juan Otero – Co-Founder & CSO – Linkedin

With extensive previous experience in some of the largest tech companies in the world such as Oracle and Booking.com, Juan is responsible for managing Travala.com’s strategic initiatives and future goals involving communicating and implementing the company’s long-term strategy internally and externally to support the optimal execution of key initiatives.

Kent Pham – CTO – Linkedin

Being an executive leader for Technologies and Operations, Kent is responsible for outlining Travala.com’s technological vision, implementing technology strategies, and ensuring that technological resources meet the company’s short and long-term needs. The achievements of the development team cannot be reached without his direction.

Drew Currah – CFO – Linkedin

As a CFO, Drew is responsible for managing the financials of Travala.com. His primary duties include financial planning, tracking cash flow, financial risk management, financial reporting and proposing corrective actions. In the past, Drew founded his own online home services marketplace and worked with the De Beers Group and Christopher Guy in financial strategy capacities. He is also a CFA charterholder.

Alexis Sirkia – Strategy Advisor – Linkedin

With an extensive background in IT operations and security, Alexis began his career as a project engineer at the European Space Center (CSG), after which he co-founded a leading crypto market making firm. Alexis is currently the Founder of the leading blockchain incubator and accelerator Yellow.com and a valuable strategic advisor to Travala.com.

James Seibel – Blockchain Advisor – Linkedin

James is formerly CTO of Airfox where he was instrumental in Airfox’s USD $15 million digital asset sale. James is formerly Head of Engineering at Apperian (acquired by Arxan Technologies) and has an MS and BA in Computer Science from Boston University. James currently manages blockchain and trade engineering teams at the Poloniex cryptocurrency exchange and is a valuable advisor to Travala.com.

Juwan Lee – Asia Advisor – Linkedin

Juwan Lee is a veteran CEO and fintech entrepreneur with over 30 years of experience in the financial services and investment industries. He has served as head of equity for JP Morgan and co-founded the Blockchain Center of Hong Kong. Juwan is currently the CEO of Arrakis Ventures, and a valuable strategic advisor for Travala.com in the Asian Markets.

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