The three founders – Jamon Mok, Akash Gurung and Anil Gurung - met while studying at Singapore Management University when they were working on poverty alleviation projects in Nepal.
Backstreet Academy is a peer-to-peer online platform, through which tourists can sign up for experiences unique to that locale. The three founders – Jamon Mok, Akash Gurung and Anil Gurung - met while studying at Singapore Management University when they were working on poverty alleviation projects in Nepal.
Launched in March 2014, Backstreet Academy now has more than 600 travel experiences on sale in six countries and 24 cities.
The founders were the first to test the activities on Backstreet Academy – from learning how to tie a turban to eating tarantulas and learning how to shoot with a traditional handmade weapon. Jamon Mok talks to Syaz Haniff.
Describe the business, core products and services in one paragraph?
Backstreet Academy is a peer-to-peer impact travel platform offering on-demand unique travel experiences crafted by local experts in developing countries with a focus on intimate cultural exchange and classes offering insight into traditional skills and local life, such as fishing with nets, boxing with champions, carving workshops and even insect cooking classes.
Who are your key customers?
Independent travelers who are interested in offbeat unique travel experiences with local people. Couples, families and people who have an intrinsic interest for culture and crafts make up the biggest proportion of customers.
What business are you most likely to be compared to?
Travel activity platforms such as withlocals, trip.me.
What problem are you trying to solve for your customers?
Finding, curating the best local unique experiences and presenting them with a great user experience. It is very difficult to find local experiences that are not run-of-the-mill, and everyone craves that unique connection or special activity that defines their trip.
Safety and convenience is always a concern for travellers. While similar peer-to-peer (P2P) platforms offer unique experiences by locals as well, the P2P nature implies a certain level of risk and inconvenience arranging with the local host. We take care of all that through a verification and training process which has given us a zero-incidence rate and almost 98% confirmation response time within two hours.
For our local hosts we help them to solve the problem of accessing the traditionally monopolised tour industry by directly connecting them with the travellers.
We provide a local call centre and translator network to help everyone (even the illiterate and people without access to technology) to create a travel activity and access the tour industry, immediately increasing incomes 2-3 times directly.
What financial support did you have to launch the business?
We have a group of Angel investors who invested in our seed round, a grant from Singapore International Foundation and prize money from winning a few business plan competitions.
What is the revenue model and strategy for profitability?
A commission based model where we take a cut of every booking, usually between 10-20%.
What is the market opportunity? How scalable is this business?
Travel activity booking is the last big wave in the online travel revolution that has seen flights and hotels all consolidate under booking platforms, and it is also the most lucrative one, with the largest margins, currently at 30-40% compared to flights and hotels.
The challenge is in consolidating the numerous fragmented players across different cultures quick enough and build a recognisable brand around it.
Similar to all other booking platforms, the technology and systems can be scaled to other geographies and locales with a little localisation.
Competitive analysis – strengths, weaknesses and threats?
Our key strength is the ability to access the entire population in a particular city because we are able to bridge language and technology gaps faced by most people in South-east Asia through our local call centres and community translator networks. This opens up a much bigger breadth of activities that our competitors simply do not have.
Also, we are better in terms of search, being ahead of many of our competitors in the cities we are in.
And we have very consistently good experiences as proven on Tripadvisor where we have a 97.6% recommendation rate and were awarded the certificate of excellence in our first year of operation.
As for weaknesses, we are 2-3 years behind our competitors and thus have a lower number of cities, experiences available. And we are not as well-funded as some of our competitors.
As for threats, other travel verticals might swoop into the space in search of growth, such as Tripadvisor’s purchase of Viator. Other possibilities include airbnb venturing into activities and all the other flight and hotel booking platforms creating their own version of an activity booking platform.
Also, regulation of peer-to-peer activities similar to the regulation battles faced by other sharing economy companies like airbnb. The increased cost of compliance or the possibility of a ban can destroy the business model. A large amount of money is needed to battle regulators in different geographical locales.
Q: Why do you think you are the best people to make this vision happen?
We have extensive experience working in developing countries at the Bottom of the Pyramid (BOP) and understand the users and situation there. We’ve also put in a lot of effort to understand and empathise with our users, by staying with them on-site and observing how we can continuously optimise the user experience for them. This commitment makes us a really good team to build this vision.
Q: What’s the motivation behind doing this?
This product allows people who are traditionally left out to be able to directly access the tourist market, democratising travel for all. This changes the lives of many people, creating additional income streams and opportunities as well as offering varied and interesting experiences to travelers.
Similar to how other sharing economy companies broke down the barriers between people and brought millions of new unique and individualised experiences to people, we hope to do the same for travel activities.