Duffel (YC S18) raises $30M for flight booking API | Hacker News Reader

Duffel (YC S18) raises $30M for flight booking API

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82 pointsmattmarcus44 comments

In a world where consumer spend is going to be shrinking amidst an upcoming downturn and consumer CAC going through the rough "vertical enterprise software" is going to be the next megatrend.

Sabre does 3.87B in revenue and Duffel is just re-inventing Sabre with a better suite of APIs. What other legacy enterprise, vertical software solutions exist that people could "Duffel?"

You could probably say the same about Stripe when they just launched. Authorize.net was doing billions in revenue and stripe just re-invented them with a better suite of APIs.

Yeah Stripe was the pioneer in this space.

Truepill is an API for pharmacies that is doing seriously well and is under-hyped. The API-ification of things is a serious boon for developers everywhere.

But financial services (payments) and travel are just two verticals. There are vertical software solutions in healthcare, other aspects of FinTech (lending/wealth management), retail that can probably be re-vamped.

The question is what other legacy providers other than Authorize.net/Sabre exist. Where do we find software solutions like this?

Stripe is only loosely synonymous with Authorize.net

Your missing the part where Stripe also bundled the payment processing (Stripe uses Vantiv AFAIK) and the merchant account (which you need to get from a Bank). Stripe's innovation was to simply flatten the stack across gateway, processor and merchant bank account.

Stripe has an incredible API, but it's only one half of the equation here.

I think access to bank APIs is a similar space. Companies like Tink or Truelayer used to rely on credential passing but now with the wake of open bank apis (PTSD2) they are implementing standard oauth flows. That being said, I think that the biggest entry-level problem in that space is an enormous level of regulations regarding bank data. You can't even start using their API without your app being validated by them.

>(PTSD2) Thanks, I'll steal that.

Isn't this the space that Plaid is taking the lead in? What other opportunities are there in the banking API system aside from what Plaid is doing/won't do in the near future?

Plaid used to publish https://blog.plaid.com/rfs/ but they stopped this year.

The $1.4B Sabre does in airline bookings revenue isn't insignificant but don't underestimate the difficulty of reinventing Sabre with a better suite of APIs from both a technical and commercial standpoint though.

> Sabre does 3.87B in revenue and Duffel is just re-inventing Sabre with a better suite of APIs. What other legacy enterprise, vertical software solutions exist that people could "Duffel?"

I could enumerate 100's of these problems, but this really isn't the right question to ask. The only reason this startup is possible is because the IATA allowed them to be. So perhaps the question should be "how many industries are ready to standardize their communication protocols via modern APIs?"

Great example - providing a unified banking API is clearly a multi-billion dollar a year business. But it requires the network effect of all of the banks to be involved. This either happens via industry groups or via regulation.

> banking API is clearly a multi-billion dollar a year business

Why?

AFAIK most big banks have APIs, and it would seem to me the use cases for needing to access an account programmatically are few.

On the consumer banking side I would agree with you, not many individuals have complex enough banking needs where programmatic access would be a value-add. However if you look at businesses, any company doing more than (let's say) 50 bank-to-bank payments a month I think would benefit from being able to automate their bank account interactions in some fashion.

Disclosure: I work on banking APIs

And I would humbly ask for someone to think again about the regular people on a more pragmatic or tech-savvy end. My banking is relatively simple, and yet many of my needs are not covered by any existing solutions. The absolute basics I want is an API access to my current per-account balance. Another step would be programmatic access to per-account transaction history.

I don't want to use banking apps and sites daily, they all offer garbage UX that's designed for upselling credit cards, consumer loans and other financial product. What I want is simple API access. I can take it from there, and do a better job than banks do, because my own incentives align better with my own interest.

1. Most big banks require a ton of red tape to use those APIs. Even if you're using modern technology with a top tier dev team, this is still a 4-6 week endeavor at its absolute quickest turnaround.

2. All ACH transfers, for example, have to clear the Fed, which is done via FTP.

3. The consumer use cases are endless (make payments, analytics, etc). Just look at Mint, Truebill, etc.

4. The commercial user cases are endless (treasury management, AP, AR, etc).

(Disclosure: I'm the CEO of Duffel) Totally agree with your point above re: IATA. They made it possible but for a different reason, they opened the door to competition.

Standardisation of communication protocol can only do so much, especially when the standard is built to accommodate the needs of 100s of airlines using 100s of different host systems.

Also, there is ton of red tape around airlines' APIs as well, I'd say probably as much as in banking.

FTP? I hope at least FTPS.

I mean I feel like "need" is a bad choice, when the point is that it can be a lot better. I didn't need Venmo to send money to friends, but it is quite clearly better than pre-existing options. Also there are plenty of shitty banks out there with their own insular network and plenty of money they are working with. What options do you have in the Middle East per say?

This is the essential issue with the travel industry. The data, and especially integration with the GDS's themselves is tightly controlled.

I've had many an idea for travel startups but data has been a non-starter.

I give Duffel props for having the mojo/influence/connections/funding to successfully implement something like this in an industry that has had few players. The only one I can think of is ITA but they are no longer independent.

From what I understand, Duffel are connecting to NDC APIs exposed by the airlines (or rather, by the Airlines' IT provider, i.e. Sabre and Amadeus... but that's another story). And on top of that, they expose a nice REST API (that is very similar in philosophy and structure to the NDC XML - Offer, Order). This is a win for the airlines, because every booking through Duffel is a booking without paying the GDS tax

I was wondering why it was only a handful of airlines! Thanks for the insight.

What do you mean by "vertical enterprise software"?

Concur

Is this aimed at the existing travel agent industry or at an entirely new class of travel professional? If it's the latter, I'm pretty excited about this. I have several friends who I've leaned on for helping with travel plans (who essentially acted as my API for international travel). I could see plenty of businesses created out of this - imagine turning a travel blogger into a travel planner with minimal additional effort on the part of the blogger. Airline points writers would also seem to be an ideal user of a suite like this.

That’s sort of the vision I have for https://www.naverator.com/. Make planning the actual specifics of a particular trip easier, but also make it easier to discover and share ideas with others both within the site and on other platforms.

THIS THIS THIS!

Exactly what excited us about building Duffel in the first place. (After we struggled to get access to a decent travel booking API ourselves).

We want to give everyone the opportunity to sell travel products, anywhere.

Glad to hear that! I have one friend who has built a reasonably successful luxury travel business, but I have at least 5 others who are functionally free APIs for their friends. I would love to see this as an emergent specialty space - imagine if a frequent traveller like the ones I'm referring to could plan their trips, but also easily create them to share and sell to others.

Amadeus offers an easy-to-use and affordable flight booking API too: https://developers.amadeus.com/self-service/category/air/api...

What's new here that Amadeus or Sabre do not offer?

You need a few legal requirements before using Amadeus (you can see them just before registering for their developer portal). And the process for going live with them - even after meeting their requirements - is so slow.

Duffel breaks a lot of barriers to entry.

I had to build a hotel booking platform on Amadeus a few years ago and it was a nightmare to work with their API. It would frequently break or start returning differently formatted responses. Also the support was so bad, I felt like I was the first developer the reps had ever spoken with. I hope a newcomer can unseat the incumbents in this space, it's badly needed!

While we are innovating in this space, perhaps it's time to address IATA's PNR (passenger Name record) Standard that is used by Sabre and Amadeus. Plenty of privacy issues in that old system.

https://en.m.wikipedia.org/wiki/Passenger_name_record#Privac...

The PNR is a bit of a nightmare, but you have to keep in mind that the PNR itself and the interfaces to manipulate and transfer it have been backwards compatible since the mid-70s. The PNR won't go away soon, however what is important is to move it away from the end user (whether traveller or agent) and relegate it to a low-level data format. Using PNR+last name as a form of "secure" identification is crazy for example.

Pretty exciting! Some time ago I was checking the available APIs for searching flight information. I was quite surprised to find out there wasn’t anything suitable for starting small.

API with a reasonable pay-as-you-go plan would enable innovation on this space.

Despite all the effort from different companies the searching/booking experience still does not feel ”enjoyable”.

Agreed. I had a side project I wanted to work on a few months back, and had to icebox the idea because the current flight related APIs are not great, and access is geared towards larger, established companies.

I emailed some travel related API providers for a side project a while ago and they happily offered me a cheaper price than the listed one once I explained what it's for.

Never hurts to give it a try.

I did in fact try, and was rejected either immediately or after a few weeks of reviewing my request.

IIRC one provider did let me in, but it didn't have the functionality I needed.

I'm not sure I'd be comfortable making a big bet in air travel. I've been seeing more and more discussion about how bad air travel is from a carbon point of view and it feels like something might happen with that in a few years.

I read an article yesterday where the author was arguing that air miles programs need to end and in fact it should be flipped so that the more you fly, the more you pay (considering that you have to fly with your ID it should be easy to assess). If that gains traction, it could mean a significant reduction in flying and that might be a good thing.

Can someone explain how Duffel is different than the google flights API?

Are you referring to QPX?

Congrats.

I went to their site. Too bad there is no blog or any content there beside the homepage. Hope they will create it soon.

A large portion of that $30M will go to PPC campaigns probably, instead of building a solid SEO structure that gives real value to their target audience and creates a solid brand.

More content coming soon - there is tons of stuff we want to share about the industry.

Definitely not planning to spend a large portion of that $30M on PPC, maybe just $25M.

joking!

Are you calling Sabre / Amadeus APIs in the background "for now" ?

Nope, no GDS at all

Imagine if you will, a company that spends an investment on building product, instead of building SEO

thats hard to imagine when you look at the books for a number of unicorns that are literally burning hundreds of millions(per quarter) more on advertising than on their actual product. ;)

They’re integrating with Airlines’ booking systems directly. This will work until you become so big that the airlines feel threatened by you, at which point they’ll cut the API access and implement whatever idea you were working on.

That’s how my bank operates! You can use our API but we reserve the right to shut off access at any time for any reason. Oh look, your customers love this feature you just added? Gee, we need to close your API access for reasons. Oh look we just added this great new feature to our app, don’t you love it?

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