The Swedish travel startup Traveas is going public – it will be listed on AktieTorget, the stock exchange for developing companies. They will be offering Traveas stock for the public between 7th of May and 25th of May. Trading with Traveas stock will begin on 26th of June. Traveas pre-money valuation is at 17,5M SEK (1,65M €)
We had a brief chat with Jack Melcher-Claësson, co-founder of Traveas about the listing. Jack told us that there are basically two factors in why this new stock emission is interesting. Firstly, as we told in the title Traveas will become a public company. Secondly, the reason for them gathering up money is the need to be able to run faster in the European market. Their press release tell us that they are looking for an investment around 3,5 M SEK (330k€).
Traveas has done quite a bit of work before hand to build their business to the point where the money is put into good use. They have signed deals with very attractive partners such as VIA Travel and Seat24. Their service is being used in many European countries, including Germany, France and England. Traveas has estimated and discloses that they will be able to receive a positive result on a monthly basis with about 100 000 bookings. The aim is to achieve profit by the end of year 2009.
We wrote about Traveas looking to land an investment around 2-4M SEK back in March. It’s admirable when you dig into the situation a bit more. Traveas is a travel company looking for funding in the midst of economics crisis. Even though Jack told us that they are not looking for a VC investment that would bring them a lot of money and thus responsibility, the decision to go public in such an early stage is very interesting.
Firstly, if you think of an early stage company going public with a small valuation – they bring in a lot of capital from thousands of individual investors, making the capital acquisition more probable. However, when you go public you agree to bind by the financial rules and laws of the governing country. I’m not an expert of the Swedish judicial system, but it’s obvious that you are required to disclose a relatively large amount of information regarding your business.
By no means is it clear that Traveas will be able to pull through the investment, but the odds of it not going through are very minimal. Sweden is in very good economic health despite the downturn in the economy. With the weakening of their currency, the crown, they have managed to create a lot of interest in their products and thus exports are going to pull them through this economic downturn – something many of the Euro countries are very jealous of. Furthermore, the investment is not that big – we’re talking about amounts less than half a million Euros.
What are your thoughts on this sort of financing? Should more startups embrace alternatives such as this?