Who’s Backing Travel Tech in 2025 Venture Boom

The weak fundraising climate that has clouded many startup sectors this year has not stopped a handful of venture firms from doubling down on travel technology. New analysis from Phocuswright shows that even as overall travel-tech investment slips below last year’s pace—just US $1.1 billion through May—several specialist funds continue to write checks and shape the next generation of industry disruptors. Thayer Investment Partners tops the 2025 leaderboard with 16 deals in companies ranging from cruise booking platform Cruisebound to airfare-hacking site Point.Me. Singapore-born accelerator Antler follows with ten investments, including Indian ride-sharing upstart Namma Yatri, aviation-data play Wingbits and generative-AI travel planner Nuron AI. Brook Bay Capital ranks third after backing six early-stage startups such as bonafide.ai, itinerary builder Mindtrip and Colombian youth-tour brand YGO Trips.

The new ranking highlights an increasingly bifurcated funding market. On one side are evergreen investors willing to place multiple bets despite soft macroeconomic signals; on the other is a broader pool of firms content to sit out or allocate capital to existing portfolio companies via quiet bridge rounds that rarely make headlines. Analysts say the skew is partly explained by lingering uncertainty around interest rates and exit timelines, yet it also reflects a maturing travel-tech ecosystem where only proven specialists feel comfortable navigating regulatory hurdles, fragmented distribution channels and thin margins. Y-Combinator, for example, still participates in four or more travel deals a year—including hotel-payment platform Canary Technologies and group-ride service Fetii—while generalist giants such as Accel and General Catalyst remain on the sidelines despite recently raising fresh funds.

Another visible trend is the steady rise of artificial-intelligence applications across the sector. Investors including Tiger Global, Highgate Ventures and F-Prime Capital cite AI’s double benefit of lowering service costs and personalizing the customer journey. F-Prime, which led a recent US $60 million round in agent-first OTA Fora Travel, argues that the industry’s post-pandemic bounce has shifted the narrative from survival to scale, encouraging founders to tackle larger, more complex problems such as dynamic pricing, fraud detection and content generation. Battery Ventures echoes that view, having anchored a US $90 million Series B in airline-pricing startup Fetcherr and re-upped in property-management platform Mews. Even conservative hotel owner Highgate is now active through its venture arm, adding data-driven brands Rest and ROH to its stable.

Despite bright spots such as Hostaway’s US $365 million growth round and Flyr’s US $295 million Series D, total dollars raised in 2024 barely nudged up from 2023 and the number of disclosed rounds fell to a record low. Some observers believe the decline is partly illusory: corporate investors often keep financings under wraps, and many secondary or continuation vehicles never reach the press. Yet the message from experienced backers is clear. The bar for new capital has risen; startups must demonstrate real return on investment rather than hype, especially when touting AI. Founders are urged to obsess over concrete pain points—payment reconciliation, ancillary revenue, carbon reporting—knowing that venture partners now expect clear monetization paths before term sheets appear.

Investors polled by PhocusWire see selective optimism. Flexible, sustainable and hyper-personalized travel products remain in demand, and the best teams are building long-term defensible moats even in cyclical downturns. With the right focus on operational efficiency and measurable value, they say, the next wave of travel champions will still find the capital they need—just from a smaller, more discerning pool of believers.

Tags: phocuswire, SyndicEx250629B

Who’s Backing Travel Tech in 2025 Venture Boom

Related Posts