QUARANTINE CALL FROM Denmark
The future of travel startups with Jannik Lawaetz, founder of Luggagehero
Jannik Lawaetz is the founder and CEO of LuggageHero, a growing network of affordable luggage-storage sites. As you might imagine, both sides of his win-win travel startup have been vastly reduced during the pandemic, as travel has all but stopped, and the local shops, cafes and hotels stores that normally store the luggage were almost all shut.
Pre-pandemic, Luggage Hero launched in Copenhagen and expanded to London and New York City rapidly, and is now in 38 cities with 1500+ storage locations. It is the only international storage company to offer storage by the hour from a self-service travel app.
Since LuggageHero launched, its customers have racked up over 2 million hours of bag storage and the company, which has raised more than $2.25 million in funding to help expand its operations, was named one of PhocusWire’s Hot 25 Startups for 2019.
A graduate of Copenhagen Business School and a nominated entrepreneur of the year 2018 and 2019 by Ernst&Young, Jannik previously helped launch several Danish tech startups, including one that he launched and sold by the age of 14.
In this episode, we talk about the future of travel startups, the future of travel, and what travelers and shop owners in his 250,000 strong community are thinking about the near and medium-term of travel.
episode highlights
6:00 What Covid-19 has been like in Denmark.
8:15 The inspiration for LuggageHero.
14:30 Jannik’s success with the crowdfunding model for startup funding.
17:30 The past, present and future of startups and why it is always a challenge to get funding as a travel startup.
23:20 The main concerns for travelers within the LuggageHero community - travelers and shop owners.
26:10 Jannik’s medium and long term predictions on the future of travel.
Links mentioned in this episodE
About Adventure Calls
From her quarantine to theirs, world-traveler and author of How To Move Abroad And Why It’s The Best Thing You’ll Do, Jessica Drucker, calls up travel experts to find out what they envision for the future of travel in a post-pandemic world.
Full episode transcript
Jessica Drucker: Hi, Jannik, thanks so much for taking my call.
Jannik Laewetz: Thank you very much, Jessica.
Jessica Drucker: How are you? Most important question - how are you feeling?
Jannik Laewetz: I'm feeling good. I'm feeling good, taking everything into consideration.
Jessica Drucker: And so where are you right now? And are you still quarantined?
Jannik Laewetz: Um, I wouldn't say that I'm quarantined. That didn’t ever really happen, I think. I'm based out of Copenhagen. And right now I'm in the office in Copenhagen where I've been holding everything up since COVID-19 happened and, partly, most of Denmark has been in lockdown. And in some way, yes, you could say quarantine.
Jessica Drucker: And what has it been like where you are? I mean, you know, I am in the epicenter New York City and surrounding areas, and it's been a really different experience for us. And we're still experiencing this in a really intense way. But have you had them open up? Do you feel more free to move around in the streets like, what's your life like right now?
Jannik Laewetz: So I would say now that I have a broad view of all the cities that we are operating in as well. Good to hear I would say that it's very, very mild. The conditions that we have in Denmark in Copenhagen we've seen lockdown but we haven't really been quarantine to stay at home being able to move around three and everything and at this point, as we speak we are in the face three out of four in the opening up the society so it's happened really quickly that it started in mid-March as I remember it. So a small two months and in total in Denmark we have 5 million people living and we and I want to say only but of course, it's major losses for everyone who lost someone but in comparison to other countries. We had small losses in comparison, I think we had 610 in total in Denmark so far and really not seen so much lately. So that's good news.
Jessica Drucker: Yeah, that's really good news actually. You have such a view because LuggageHero is in so many different markets I didn't even think about you must have an overview of how many cities is LuggageHeroin the world?
Jannik Laewetz: Yeah so at this point we are live in 40 cities and they mainly spread out through Europe, Southern Europe and up to Northern Europe and then in South America, North America sorry.
Jessica Drucker: And this is like a good Turning Point obviously to talk a little bit about luggage here. I want to start by saying that the minute I heard that there was a business that filled this need, you know that I became a fangirl of LuggageHerobecause I have been in the situation so many times where I have an Airbnb and detached He doesn't line up with the airline and I'm walking around the city with my luggage, I would ask you how you came up with the idea. I'm gonna make an assumption that you perhaps saw this as a pain point. But yeah, tell us a little bit about LuggageHero.
Jannik Laewetz: So I'll take you back to 2015 where I traveled to Barcelona together with my girlfriend, and back then we didn't have any kids as we do now, but back then we were all free and adventurers and wanted to explore the city. And we lived in this beautiful part of Barcelona called Brasilia, where there are no hotels at all. And so we stayed in an apartment there and we booked it on Airbnb. And it was a great, wonderful trip. I don't know. Have you been to Barcelona?
Jessica Drucker: I have. Yes, it's Oh, yeah.
Jannik Laewetz: Yeah, it's one of my favorite cities. Definitely with the beach and everything. It's wonderful. So it's Not a CD where you really want to miss anything. And, and on the day of departure, I was like I was really happy that our flight wasn't until late afternoon. But when I started texting my Airbnb host the day before departure, I was like, Oh, can I just leave my stuff here and I'll come and pick it up later. And these Airbnb hosts To my surprise was like, Ah, that won't really work because someone else needs to check it. And we need to clean the place and you can't leave it anywhere. I'm like, shit, I'm desperate what to do. So I was thrown to the street at like 9 am in the morning, the sun was shining. And I was sweating already while carrying all these bags and then I looked off on the other side of the street and I saw a local shop like, I don't know what they were selling, but I was like, they must have space for this. I think I just can't live with this situation. So, I wandered in there and this kid was sitting behind a desk in there and now I was asking him in the most polite way if he could just hold this luggage for like the day and he didn't understand any part of English. So I mean, with it bends the pain signal and everything. I convinced him that these were the bags and they were put in here for the day and he agreed. So we went out and had a great day. And when we came back, the bags were still there, the guy was still sitting behind the counter and I tipped him off, and then we took off. And, and to be honest, I totally forgot about the experience. But when I started in 2016, to rent out my place on Airbnb, I started getting all these requests every time someone was either coming or departing, and I was getting a little bit sick of it because I needed to clean the place as well. I needed my place back and I was like shit. I thought about my experience in Barcelona and I was like, why don't I just make this into a concept? And then this is where LuggageHero was born.
Jessica Drucker: Yes. And that's really interesting on two levels. One, because you were not scared to leave your stuff with a total stranger without the comfort of it already being an established company, right? But this also is not your first go at entrepreneurship.
Jannik Laewetz: I've had a lot of weird ideas. I can tell you that. I do have a good track record of doing things that are one of my successes was in my teenage years. When I sold a mobile platform. I was only 14 years old and I sold it to this big international company called IBC international and they bought The platform together with all the inventory and may help as well and assistance for a couple of years. That was my first exit as a 14 year old.
Jessica Drucker: That's very impressive. Would you say that LuggageHero fits into what is being called the sharing economy? Or do you feel that it is in its light of its own?
Jannik Laewetz: No, I would definitely say that. It's within the sharing economy category. The sharing economy category has been like perhaps a little bit overused terminology. So I understand why you are asking but in my belief, there are some really, really good things coming out of it. And one of them is, in our case, that local shops, cafes, restaurants can actually free up space inside their local businesses and start making revenue on it. So space that was just air before turns into revenue. But even more importantly, these local shops are welcoming a lot of travelers and that is really important for traffic for a lot of these shops. It's their way of survival. So, so So yeah, we are building on top of the sharing economy out
Jessica Drucker: right and creating a win-win in the same way that like an Uber or Lyft or an Airbnb are also creating win-wins and that both sides really benefit from taking part in this. But I do have to ask since we're in the middle of a global pandemic and travel is the hardest hit of all the industries. How is the LuggageHerodoing and what are your views on how things are right now? Not yet in terms of the future but right now in terms of the sharing economy and how LuggageHerofits into that.
Jannik Laewetz: So, so yes, obviously it's really important For us to have supply and now independent make and the COVID-19 we kind of lost some of our suppliers because of the lockdown of cities and meaning that the whole beauty of our model is in our shops, our local restaurants, local cafes, everything that are freeing up space for travelers and they've been forced to lock that. Luckily, in some way, we didn't have that many travelers to accommodate anyway. So it kind of unifies in some way. But so we've been deeply impacted, of course, no, it's no lie. And now you ask how we're doing and dealing with it right now. We and I would say for the first time in two months almost, we are seeing light at the end of the tunnel. We are seeing some of our cities opening up and we are seeing some traction coming back. Certainly not on the level before the battle. They may not at all. But we are seeing things are picking up again. So that is really great.
Jessica Drucker: Has there been a time in the last two months where you've thought I've got to pivot? We have to change the business model? Or have you decided to wait this out and then power through as soon as things open back up again?
Jannik Laewetz: Yeah, I think that it obviously crossed my mind and something we've been discussing in the team as well. And, and I wouldn't call it pivoting, I would just call and say that we've perhaps pushed some things to an earlier stage than we thought we would do before independent
Jessica Drucker: That's really interesting and because you know, I've been thinking about you like I told you before we started this call this whole time actually. And you've just got this is just such a great service that fits a perfect niche. So you know, I'm a huge supporter of what you do. And what's really interesting about LuggageHerois that I think a lot of people feel like me And you reward that by letting people take ownership of luggage here. All right, your funding model is actually different to a lot of other travel startups. So I was wondering if you could talk a little bit about your crowdsource funding model?
Jannik Laewetz: Yes, sure, which I would say is quite unique as well. And something I know Airbnb has been looking into as well doing themselves to kind of engage their hostess even better. But anyway, we've, we've been doing two very successful crowdfunding campaigns on Europe's biggest equity crowdfunding platform, which is cedars. And the first crowdfunding campaign we launched was last year in April, where more than 700 micro investors joined the cap table on our company. You have these ambassadors, you have someone who is spying equity in a company who's betting your company who believes in your mission in your vision and helping you on the way and that's something that we've benefited a lot from doing this past year. And something that was actually able to get us through some of these windy circumstances during this pandemic because we launched a second crowdfunding campaign in the middle of this COVID-19 but it turned out really successful and we will bring a little bit more than 600 investors this time. So it is a way where we invite previous customers, partners, network to join us on this journey. And they certainly have
Jessica Drucker: Yeah, and in a way, I don't know if this is true, because this is way out of my league. When we get into the to like the nitty-gritty about funding, but in a way, you know, billion-dollar companies are going bankrupt or at least like really struggling during this time in terms of the travel industry. And you know, it must be actually really helpful that you're not just an idea. I'm sure you get funding from other sources too, but not only relying on sources that probably have dried up, at least for the short term. Did you plan on doing another campaign? Or were you like, Oh, no, we have to find a solution. Let's do a second crowdfunding funding campaign.
Jannik Laewetz: We, we did plan for it. But we didn't plan that we would hit a pandemic. So we were planning on doing the round and everything and then the Epidemics showed up. And then we were like, we'll try and stick to the plan. I mean, the stock markets were going up again, and it was like the world could see an end to this. Obviously, this was really, it was tough conditions. And the markets are still tough to raise as a startup. But at that point, we were like, well, we'll might as well just try it.
Jessica Drucker: I do want to ask you about sort of the state of travel startups for a little while, because you do have a good track record, as an entrepreneur, you've been in this scene for a long time. And specific to the travel industry. You know, these big huge companies are struggling at this time. And I assume the travel startups as well are just really not seeing any funding. I don't know if that's true. So you could probably answer that as well. But how do you see the future of travel startups changing medium term, but also in the long term when we see just how vulnerable we are as an industry and we've put so many eggs into a basket that relies on face to face communication and experience?
Jannik Laewetz: I would say that it's really having your What What would I say, the mountain in front of you as a travel startup at this point, unless your name is something like Airbnb,
Jessica Drucker: or even so I mean, they must be struggling I would assume through all of
Jannik Laewetz: this exam, they've been struggling. They are struggling there. I know they had planned for their IPO this year, which is certainly not going to happen. So they probably had to take some terms now during this round that they just did. That wasn't that favorable. I know that is public, and they had to cut 25% of the employee force. So that's obviously really sad. So, I mean, it's really deeply impacted them. I think that the whole travel startup community is before the pandemic as well, in rough times, because it's hard to be a travel startup because you are up against some major giants, and you're up against some really old fashioned ways of doing things. And that makes it really hard to be a travel startup. So with this hitting, it's even harder to get investors on board because they look at the statistics And they tell you that being a travel startup is not a good bet. We're just Willy. I've been lucky in some way, and that we found a niche that wasn't really fulfilled in the market. And we're fulfilling that niche really well. But it's tough. It's not getting easier now.
Jessica Drucker: And, and do well, do you think that travel startups will have as much of a challenge in front of them as startups and other industries? I mean, I know that there are like financial tech fintech startups that are doing really well right now. And some are benefiting from this. Is there? Is there a light at the end of the tunnel for travel startups in the same way? Because it's ripe for disruption? I mean, there is so much opportunity there. But like you said, traditionally, it's always been really hard. And also, just to add that quickly, you know, people are going back to wanting to use travel agents, for example, like I actually feel a little bit of a backslide in terms of the risk that travelers are willing to take. So whether or not there is opportunity there, I don't know. But taking away friction, which is what a lot of startups do seems to be something that we're not looking for as travelers right now.
Jannik Laewetz: I'd certainly think it's a really big setback for this community of travel startups and, and I think it will, it will take years to rebound. We weren't really doing that world anyway. And then and we just tossed upon one really cute, I would call them incubator, Voyager. We're situated out of New York City, we just had to stop all business. And there's not really that many of these types of incubators in travel and the ones that are having a hard time. So
Jessica Drucker: it's really sad because as we were talking about Voyager HQ was one of the few incubators that focused solely on travel. And yeah, they closed their doors very early on in the pandemic, because at that time, you know, especially in New York City, there was just no light at the end of the tunnel. But in terms of LuggageHeroYou know, what is it about the type of niche that you found that you think is going to sustain you into the future?
Jannik Laewetz: And one of the things that take us apart from some more traditional companies in the travel space, and now I'm not just talking about startups is that we're probably one of the more lean ones, particularly because we are a market platform. And we don't, we don't really own any hardware inventory, real estate or anything. So our biggest cost is obviously having employees. But we're still at a really lean stage of the company. We're 16 people in the company. We're a b2b, I think there were 7000 we can survive this and looking at it so and I think that's, that's the beauty of our model that we're not that heavily dependent on having inventory and so on. So that's why I think our niche will certainly survive
Jessica Drucker: and just thinking a little bit about your customers? For a minute
as travelers? Are we going to be willing? I mean, depending on your level of paranoia, I know that that is part of this question. But what will you do to talk to travelers about leaving your bag with a stranger who may touch it? Who may have COVID? Like, you know, talking about your safety and transparency? How are you guys planning to do that in the coming months?
Jannik Laewetz: Yeah, so it's actually a good question because we just launched the Self Service, luggage storage on our platform, and it means that you don't really need anyone else to interfere with your bag in order to keep it safe. So whenever you are arriving at one of our locations, you're just pointed in a direction of where you can leave it. You're putting on the security seal yourself. You're starting the timer on your own phone. You just showing the phone to me In the shop that you started the timer and you're leaving. And once you come back, you just collect your bag yourself and you start the timer on your phone and you provide the feedback instantly. So this is all hands-free, you could say in the shop.
Jessica Drucker: And have you heard any feedback from travelers yet about fears and issues? Have you surveyed anyone? What are you hearing that tend to be the bigger fears for travelers and then the medium term?
Jannik Laewetz: It seems like the biggest fear for travelers is two things. Can I go? Can I even get into the city? And will I be pointy when I get back? That's the driving concern among our community. Our community is 250,000 travelers and we've been asking them several times over this period with questions questionnaires about their looks on the future and when they would like to travel again and how they would be traveling and so On, and it seems like it's not really the buyers, which it is any fear. for them. It's more like all the conditions around it like will public transportation get me anywhere? Will I be able to get to the airport? Will I be able to fly? It seems like that's the primary concern.
Jessica Drucker: I wonder how is a LuggageHerotraveler different to say like the average traveler? Are they more intrepid? Is there less fear that's guiding them? Are they younger?
Jannik Laewetz: Yes. So they're definitely in the younger category of say, even younger than me sometimes. So I mean, we do have the majority of our users being from 18 years and up to 34. So that's, that's the majority and it seems like they're more fearless than then the elder population is in regard to this. And that's what we've seen this year. As well I think so. So that's probably one of one of the good things for us at least that we do have this kind of travel is
Jessica Drucker: The last thing I want to ask about this is your shop owners. How are they communicating with you about their feelings on participating with you in this added element? I mean, I'm sure they desperately want people back into their shops and any excuse to have them must be welcome. But what are you hearing from shop owners in terms of how they feel to be back and open and working with you
Jannik Laewetz: the biggest concern for a lot of the shop owners at this point, it's not so much about the buyers it's more about survival. So we've obviously been trying to get as good as possible an overview of this situation because they supply they we can live without them. And that's why we really want to be close to them and understand their situation. And a lot of the shops are saying that they don't know they will be in business in three to six months, they have no idea.
Jessica Drucker: When you think about now, just in terms generally of the future of travel, what do you see as being like a few of the major things that may change or may not change at all, as we move forward? Hmm,
Jannik Laewetz: yeah, I think that there will be some short term effects that we will see here in 2020. And, and perhaps a little bit way into 2021. Long term really long term, I don't think this will impact how many people who travel abroad. I mean, we've seen it before in history, we've seen it with 911. A lot of people thought no one would be traveling anymore. And back when 911 happened, we had like 700 million people traveling internationally. And now last year, we had 1.6 billion people traveling internationally. So I mean, in the long term people forget. In the short term they make new plans. And then and they love the new plans are domestic. Obviously, it's what they can do and what Americans do going to anyway, a lot of them. But put domestically will be the headlines for the short term I've been in long term we want to see the world.
Jessica Drucker: Before we close out for today. Where can people find LuggageHero online? How do they download the app? How do they become a part of your community? And where can we find you as well?
Jannik Laewetz: So start out with where can you find me, I'm always on LinkedIn. LinkedIn is my neighborhood. So to say, I don't really use Facebook. I don't really use Instagram. I use LinkedIn a lot. And I post a lot. So certainly feel free to connect with me on LinkedIn and the company as well. But yeah, the company is on all social media channels and even onTikTok, which is the old one the new bus. It's certainly something that we're betting our horses on and so we're doing all the strange things on TikTok so if you want to laugh. You certainly find us on TikTok.
Jessica Drucker: Okay and are you @LuggageHero on TikTok, easily findable.
Jannik Laewetz: Yes @LuggageHero you will find our good video creator, Sip, who is doing all the weird things.
Jessica Drucker: Really fun. That's what this pandemic has brought me for sure is an even deeper obsession with TikTok, so I will follow you.
Jannik Laewetz: It’s madness what is going on in there. We had one viral hit on one of the videos he put out that had more than 1 million viewers.
Jessica Drucker: Well congratulations on your TikTok fame.
Jannik Laewetz: And sorry, we forgot about the app. You can go in on obviously the App Store on Google Android iOS, you can find LuggageHero, So you have it by hand or whenever you find it. Convenient, of course.
Jessica Drucker: Yes. Thank you. That's great. And we'll put all that in the show notes for sure. Including your LinkedIn. And yeah, thanks so much. Good luck. I can't wait to see what you guys do in the future. Always looking forward to it.
Jannik Laewetz: Thanks for having me.
Jessica Drucker: Thank you. All right. Thanks so much for listening to episode eight of Adventure Calls. If you enjoyed it, head over to wherever you're listening to this podcast, Apple podcast, Google podcasts, Spotify, tune in I Heart Radio, and please rate or review this episode. And to hear future episodes, go ahead and hit subscribe. for links to any resources and social media mentioned in this podcast episode. Head over to www.JessicaDrucker.com/ac8 Thanks so much for listening. I can't wait to see you on episode nine of Adventure Calls.
*Transcribed by https://otter.ai AI transcription service. Please excuse any errors