Qantas quits the startup world

Airlines want to invest in emerging technologies. They want access to the startups and to foster those relationships. This is the message delivered around the world as investment funds, incubators and accelerators sprout up. Many of these programs claim success and continue to grow. For Qantas, however, the message is different. Its dedicated venture group dissolved in recent weeks and the accelerator shuttered.

The company launched its AVRO Accelerator in 2017 and ran a pair of startup cohorts through the operation. Rather than continue that process, however, Qantas will now focus its innovation efforts on individual business units rather than dedicating a team to manage the process. In a statement issued to Australia’s Business Insider the carrier focused on ultra long haul flying and financial services tied to its loyalty program as areas where it hopes to continue innovation.

Expecting innovation from startups to make Project Sunrise viable might be a bit much. Other, similar airline incubators have seen some success around loyalty and associated products, however. Arguably these same successes can be realized without a dedicated team, though few airlines will claim that. Indeed, each of the airline incubators specifically calls out the challenges of innovating within the rigors of an airline as compelling the launch. The idea of failing fast, much less failing at all, is not viable in most airline cultures.

Early AVRO participant Volantio has since secured funding from JetBlue Technology Ventures, International Airlines Group (parent of British Airways) and others. Volantio also saw its solution installed as a trial with United Airlines. Other companies in the program have also seen some success, though perhaps not as broad.

Other airline-run startup groups include IAG’s Hangar 51 and El Al’s Cockpit Innovation, supported by JetBlue Technology Ventures. The Lufthansa Group operates an Innovation Hub group and EasyJet has its Founders Factory. Airbus runs its BizLab group while Boeing‘s HorizonX seeking similar projects to support. Starburst is perhaps the largest aero incubator operating, though unaffiliated directly with an airline or manufacturer.

That presents a lot of competition for qualified startups in a relatively small market. Perhaps it limited Qantas’s ability to attract qualified applicants.