BusBud: Behind The Deal with Plaza Ventures & iNovia Capital

Jon Jackson, CENTRAL (FEB 2, 2018)

On Jan. 30, 2018, Montreal-based BusBud announced it had secured CAD $14M in Series B funding. The round was led by iNovia Capital and included participation from a syndicate of new investors including Plaza Ventures, Teralys Capital, Real Ventures, as well as Claridge Investment Ltd.

BudBud is an online marketplace that enables global travelers to shop for and book intercity bus tickets on over 1.4 million bus routes worldwide. BusBud is available in eleven languages, and offers customers the ability to search, compare and buy tickets from over 1,300 bus companies in 16,000 cities in over 75 countries, supporting transactions in 30 currencies.

For the latest in the CVCA’s “Behind The Deal” series, we caught up with Plaza Ventures and iNovia Capital; two of the players involved in the deal.

Why did your firm choose to invest in this company and the management team?

Plaza Ventures: The team is strong operationally, personally invested and has attracted an impressive investor roster with industry expertise and connections. The company has spent years aggregating fragmented inventory and presenting it with an excellent UI/UX. They have significant traction and a strong competitive moat. Their partners speak very highly of them. The exit strategy is clear and aligned. They are at that “moment in time”, with the model figured out and profitable, when investing in growth is an easy decision. We are “moment in time” investors and BusBud is in our sweet spot.

iNovia Capital: LP Maurice is an incredible CEO with experience working in some of the top tech companies in the world (Yahoo and LinkedIn) as well as graduating from Harvard in the MBA program. LP has built a great team, has an amazing understanding of his metrics, and is laser focused on capturing the worldwide bus market. We are excited by this company due to its incredible traction with bus operators, a wide-ranging supply of routes, and success in international markets. We feel these elements have huge value for strategic acquirers.

What will the invested dollars be used for?

Plaza Ventures: Revenue growth, aggregating more supply, some product evolution.

iNovia Capital: The money will be used to nearly double the size of the team in Montreal, further develop the tech to improve the user experience and capabilities and grow its marketing channels on an international basis.

Where did you hear about the opportunity?

Plaza Ventures: Through our network. We had followed them for some time.

iNovia Capital: LP Maurice is a leading entrepreneur in the Montreal startup ecosystem that we funded several years ago in the seed round, series A round, and in the Series B.

What is your anticipation about this sector in the short term and long term?

Plaza Ventures: Short term potential for explosive growth internationally, solving a big problem in a hugely fragmented industry. Long term consolidation of inter-city bus travel into all the major OTAs like Expedia and TripAdvisor.

iNovia Capital: Bus travel is one of the largest markets in the world, however it has been largely forgotten by many of the large multi-modal OTA’s. We see this industry becoming more digital, with online bus tickets replacing a lot of ticket counters, and with travellers relying on online platforms to book bus travel. In the long-term we see bus as a logical extension to existing travel booking platforms. When you are looking to book a hotel, flight, or train, you will also have the option to book bus. This will help improve the travel experience of both local and international travellers.

Is there anything particularly interesting about this deal that you’d like to emphasize?

Plaza Ventures: The very difficult job in supply aggregation that the team has done so well, has given them a differentiated position in a highly acquisitive industry.

iNovia Capital: The strength of the team and belief we have in the market. iNovia has built quite the travel portfolio and our thesis continues to be fine-tuned. Here is our blog post on our history investing in travel.

What is your exit horizon on this deal?

Plaza Ventures: We expect further financing or a strategic buyer to provide liquidity within two to three years.

iNovia Capital: Our goal is to build a massive supply network of bus routes so that they become valuable to other modes of transport. This financing round helps us to invest in growing that supply and building relationships with strategic partners.

Tell us about the experience and expertise of the individual lead at your firm involved in this deal.

Plaza Ventures: Our whole management team is deeply involved in every deal that we do. Matthew Leibowitz brought the deal in and will be our lead interface to the company going forward. Matt has completed dozens of growth-stage transactions, equity and debt. He has a deep feel for investing at the right moment in time, where funds are used to drive revenue growth, cash flow and path to exit. Matt has invested in, and been on the boards of, companies in the travel space.

iNovia Capital:  Magaly Charbonneau will be joining the Busbud board. She is a Principal at iNovia and is a seasoned entrepreneur who has started and sold 4 companies, most recently Password Box to Intel Corporation.

Source:

http://central.cvca.ca/busbud-behind-deal-plaza-ventures-inovia-capital/2018/02/02/