Travel leaders name six biggest threats for startups in 2027

General-purpose AI assistants, a broken customer acquisition funnel and a squeeze on investor money are likely to be the biggest threats facing travel startups in 2027.  That's according to speakers and judges at the Travel Technology Association's (Travel Tech) Start-Up Summit, which takes place on October 14 in Washington DC. 

The biggest threats for 2027

According to speakers, investors and startups at the Travel Tech Startup Summit, these are the biggest threats and challenges that will face new companies in 2027: 

1. Obsolescence at the hands of big AI

"The single biggest threat to travel tech startups is obsolescence,” said Gilad Berenstein, Founder of Brook Bay Capital.  “Will they be relevant market players in two or three years?  Muse, Meta's new personal assistant, is claiming to competently do everything that our sector's AI assistants and trip planners do.  That raises a real question about the relevance, value and viability of travel-specific AI assistants.  Our startups have to figure out how to stay relevant in an era where AI is eating the world." 

2. The customer acquisition funnel has broken up

"Perhaps the biggest threat to travel tech startups in 2027 is that the traditional customer acquisition funnel doesn't exist anymore,” said Jared Alster, Chief Strategy Officer and Co-founder of Dune7.  “Search, social, AI assistants, brand sites, in-person events and creators all compete for the buyer's attention.  This is equally true across B2B and B2C.  It's harder than ever for startups to build an audience and generate qualified leads.” 

3. Investors want revenue, not demos

"In travel tech, a good story gets you in the room, but revenue commands the room,” said Chris Joyce, CEO of Gusher.  “The biggest threat to travel startups in 2027 isn't a lack of capital; it's founders building flashy tech without a real path to profitability. To survive, startups must stop relying on venture subsidies, charge early, and prove unit economics from day one. Paying customers are the only story that matters." 

4. Corporate buyers won't bet on the unproven

Corporate travel is one of the hardest markets for a startup to crack, and it's getting harder,” said Steve Reynolds, CEO of CorpTravelTech.  "It's not enough to have a great product.  Providers have to show a clear ROI (4:1 or more), navigate around obstacles put in place by TMCs and GDSs, and compete with similar products provided for free.  However, if you can do that, marketing your service is a lot easier and less expensive than the leisure market.  Very few events and trade publications really matter. 

5. Industry silos that prevent a trip existing holistically

“[The biggest threat to travel tech startups is] the silos in the industry, which often treat each element of a trip as a completely different transaction,” said Eric Bailey, CEO of Purposeful Travel Solutions.   “Travelers look at the trip holistically, including travel companions, ground transportation, and a detailed itinerary.    Consolidating this data is both one of the biggest challenges and opportunities in the travel tech space.”

 6. The merging of two worlds – old infrastructure with new AI capabilities – could be an innovation barrier

Travel was built on infrastructure created by true pioneers, and it still powers the industry today. At the same time, AI is reshaping what travelers expect and what startups can build. The challenge in 2027 is to innovate boldly while working with the realities of both worlds, and to build privacy, AI, and pricing compliance in from day one, said Li Reilly Partner, Biztech Lawyers, and Fractional General Counsel of the Travel Tech Association

Pitch Competition 

Eight startups will compete in the Summit's Pitch Competition: Chirrup, CleverFi, HousMthr, ItinAFairy, RoomRite Group Solutions, The Run Hub, Tripiamo and Voyagier. 

They will pitch to a panel of judges:

• Steve Reynolds, CEO, CorpTravelTech

• Jennifer Wilson-Buttigieg, Executive Director and Head of Policy, Chase Travel

• Chris Joyce, Founder and CEO, Gusher

• Scott Hill, Founder and Executive Director, Proxenia Foundation

• Shondra Washington, Founder, TBC Capital

The audience will also vote for the company they would personally invest in.