ForbesAsia-April2018

64 | FORBES ASIA APRIL 2018

FRANCO VOGT FOR FORBES

O

ne of the most cutting-edge travel apps in the

world makes its home in a decidedly old-fash-

ioned setting: an active zinc factory in Montre-

al’s former garment district. Walking through

a maze of sputtering machines and chemical vats, Fred

Lalonde, founder and CEO of Hopper, the world’s fastest-

growing flight-booking app, explains why he has rented the

space since 2009. “As bad as this place looks, it was prob-

ably the smartest place to start a data center,” he says. The

building is powered by a hydrodam, part of a Canadian sys-

tem that delivers a supply of cheap electricity and a perfect

match for an energy-hungry startup making a big- data bet:

that AI-driven recommendations can make travel more af-

fordable and personalized than what people can craft for

themselves.

Unlike most other travel sites, which generally want

you to book right away, Hopper is predicated on patience.

“Think of an e-commerce site that tells you 70% of the time,

‘Don’t buy,’ ” says Sophie Forest, a partner at Brightspark

Ventures, the startup’s first investor. “Hopper is that anom-

aly.” Aimed primarily at the leisure-travel market, the app

uses a sophisticated algorithm to predict the best deals and

times to fly and buy—alerting users at the optimal moment,

well before prices go up or down by specific amounts.

Since its launch in 2015, Hopper has become the most

formidable newcomer in an $800 billion flight market dom-

inated by Expedia, Lalonde’s former employer, and Booking

Holdings (previously called Priceline), and now boasts more

than 20 million users.

In January, Hopper was the fourth-most-download-

ed travel app in the U.S., after Uber, Lyft and Airbnb. The

120-person company, led by Lalonde, 44, and cofounder and

CTO Joost Ouwerkerk, 46, generated about $15 million in

revenue last year by selling flights, almost entirely through

push notifications.

Customers buy more than $1.5 million in flights per day

across more than 3 00 airlines, and give Hopper a $5-per-

ticket fee (airlines pay a 1% to 4% commission). Hopper

says customers save an average of $50 per ticket and claims

its airfare forecasts are 95% accurate up to a year in advance.

Meanwhile, Kayak predicts flight prices only seven days out,

The Vacation

Predictor

BY KATHLEEN CHAYKOWSKI

While many bank on AI paying of in the future,

one of the world’s hottest apps, Hopper, has

raised $84 million by monetizing it right now.

Technology