Tag: 2021-08-06 01:14:32

[earn money by answering surveys]Founder returns to Muslim-friendly OTA Tripfez with plans to ‘consolidate’ Malaysian travel

  KUALA LUMPUR – Faeez Fadhlillah has been making hay during lockdown. The entrepreneur now has his Muslim-friendly travel company back after nearly two years of watching it from the wings, and he is certain that its return is just in time for the travel market to boom.

  “Churchill said ‘never let a good crisis go to waste’ and that’s the same with us,” he told Salaam Gateway over Zoom from his home in Subang, on the outskirts of Kuala Lumpur.

  ”We saw an opportunity for when travel opens up again and we got the idea of acquiring Tripfez as a whole and perhaps consolidate a few travel companies to be prepared when the borders really do open.”

  In 2016, Faeez founded Tripfez in Malaysia to “make Muslim travel ridiculously easy”. Soon afterwards, the online travel agency (OTA) that specialises in Muslim-friendly and umrah packages raised $750,000 in a seed round of financing led by “Taqwatech” venture capital firm Gobi Partners.

  By 2018, it had merged with Middle East OTA Holidayme, a Gobi stablemate, and the following year, Faeez was no longer in management there, having cashed out of the company.

  Nobody could have predicted the pandemic that would descend just months after clearing his desk, and it was probably a very good time for a travel executive to sit back and survey the mess that had become of their industry, as borders remain shut and local travel restrictions diminish businesses.

  While 2020 was a write-off for many travel figures, it gave Faeez the space to chart a new course. He used that time planning his return to the tech world with a focus on “consolidating the travel industry” by buying up businesses off the peg.

  “With any crisis, you see a lot of companies consolidating for two main reasons: people are more willing to sell to you and buying becomes a lot cheaper as well,” he said.

  “It’s been the perfect time to step back and examine the options because we have a lot more options than, say, we would in normal times. It would be harder to acquire a company then because of price and because people are less willing to sell it. During this pandemic both of these are eliminated.”

  In his sights are travel businesses that are “excelling in their fields”. Already, one is in the bag—Tripfez, which be brought back into the fold in June—and others are on the way. Working with “a couple of associates” and financing the putative empire-building through debt and equity partners, Faeez is coy about giving too many details about his travel targets.

  “They are in the travel space and operate in a specific niche of their own market. We are only looking at companies with their own specific customer profile. But we are starting with local companies, big ones,” he said.

  “My motivation was pretty clear. To capitalise on travel once the borders open.”

  Having viewed the Malaysian travel situation from outside over the last 18 months of lockdowns and travel restrictions with only fleeting periods of business as usual, Faeez rages that the government hasn’t given the industry the credit it deserves and needs to weather the pandemic.

  Naturally it has been hit hard, with travel agents feeling the pinch more than most. According to industry figures, about 40% have already closed their doors and not many are likely to reopen in better times. The Malaysian Hotels Association has said that around 120 hotels have closed this year and businesses will struggle to recover the longer they are forced to wait.

  Given that tourism is the third biggest contributor to the Malaysian economy, and accounted for an estimated 15.9% of GDP in 2019, more urgency should have been given to supporting it, he believes.

  Even though the government has announced it intends to open a travel bubble around Langkawi, which probably will not come to pass, still much more is needed, starting with a clear roadmap to guide the segment back into business.

  “When is the border going to open? We don’t know. When will we be allowed to travel domestically? We don’t know. I don’t know of any country in the world, beside Australia, that blocks people from moving within it based on districts,” said Faeez, referring to the current policy of stopping most Malaysians from travelling more than 10 km from their front doors.

  “It’s because of that that the travel industry is highly affected. People who used to make money from travel can no longer do so. It’s an industry that the government can give a lot more help to, and it should. It’s not a natural loss of revenue, it’s an artificial downturn caused by these policies.”

  Speaking as an industry advocate, having assumed the position of honorary treasurer of the Malaysian Association of Tour and Travel Agents in 2019, he claims this lack of a roadmap has stopped many tourism businesses from taking advantage of the financial assistance they have been offered during the pandemic.

  Last June, the government allocated 1 billion ringgit to the tourism sector for financing, but demand for these funds has been very low.

  “We had discussions about this with the central bank; why has the pick-up rate been so low? The answer is very simple: we don’t know what’s going to happen in a year or two years because there is no clear roadmap,” said Faeez.

  “If I know when things will open, I can plan ahead and be ready to start paying back my loan. If I don’t know what’s going to happen, it’s going to be very hard for me to take out that loan.”

  Moreover, the national recovery plan spelled out by the prime minister in June didn’t even mention tourism, but instead focused on case rates and vaccination numbers. “It should have,” he added.

  DIVERSIFICATION

  Now Faeez has seen the damage wreaked on the travel and tourism industry by this unforeseen pandemic, the need to diversify is clear.

  Back at the helm of Tripfez, which he says had been seeing fivefold annual growth until business ground to a halt last year, he has already also made a move into healthcare and is also preparing to enter the food industry.

  He has made a move first into the former, having acquired “a few local pharmacies” in preparation for opening an online halal pharmaceuticals retailer, Downtown Pharmacy, by the end of this year or the middle of next.

  “My area of interest has always been in the Islamic economy and I have a strong interest in the health space. We are hoping to create a pharmacy chain targeting Muslim-cautious customers. The idea is transparency, so there won’t be things sold that aren’t Muslim-friendly,” he said.

  He also plans to capitalise on the ongoing expansion of the dedicated halal food industry by acquiring a company that focuses on the “security of the Muslim food chain”. He is still in talks with his target and hopes to finalise a deal soon.

  It is a departure for someone who launched Tripfez and other previous start-ups from scratch to pivot to mergers and acquisitions so strongly, but Faeez is exhibiting the zeal of a convert.

  “The best thing about M&A is that things are already there and you know for sure that they are operating and you know for sure that they are making money. You are not going into unknown territory.

  “I never expected there would be a period like what we have been seeing over the last 18 months, when nothing ever happens. It’s been a good period for me to look for opportunities to venture into,” he said.

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