Hopper Financial Model

• Travel marketplace: Flights (200+ airlines, GDS + NDC + API), Hotels (2M+ properties, closed-user-group / mobile-only rates), Cars (launched late 2020, ~15% of bookings by deck date), Homes (pipeline).
• AI price prediction: Proprietary forecasting predicts future travel prices with 95% accuracy; sends push notifications advising when to book.
• Fintech ancillaries (in-house underwritten, dynamically priced):
• Price Freeze: locks price 1 hr–14 days; avg. $60 per transaction; redeemable against booking.
• Cancel/Change for Any Reason (CFAR): 5–20% of trip cost → 80% cash back on cancel, or free date/carrier change.
• Disruption Protection: rebooking or reimbursement if delayed/missed connection; ~$20/traveler shown in app.
• Price Prediction: free feature; drives install/engagement flywheel.
• Carrot Cash: in-app wallet / loyalty currency funded by fintech margin, returned to customers to lower effective travel price. Growth loop: fintech revenue → lower travel prices → higher conversion → higher retention → more fintech revenue.
• Hopper Cloud (B2B, launched 2021): syndicates fintech products via API, modular travel categories, white-label travel portals, and full-stack cloud to OTAs, TMCs, rewards programs, airlines, banks.

• Online Travel TAM: $662B
• Mobile Travel market: $264B
• Travel Fintech TAM (Hopper Cloud addressable): $200B annually (theoretical: if Hopper Cloud fintech powered all OTAs, price-comparison, TMCs, supplier sites)
• No SAM or SOM breakdowns presented. No CAGR figures stated.

• Booking commissions / net revenue on air, hotel, car transactions (agent model; take-rate on GDS/NDC/direct-contract)
• Fintech ancillary attach revenue: Price Freeze (~$60 avg per transaction per slide 17, or $5 min deposit shown in mockup), CFAR (5–20% of trip cost), Disruption Protection (~$20/traveler shown), sold at time of booking checkout. All underwritten in-house; Hopper retains 100% of premium net of claims.
• Hopper Cloud (B2B API): partners pay to embed fintech products; Hopper earns upfront commissions on ancillary sales through partner channels.
• Fintech mix: >50% of total Hopper revenue derived from fintech ancillary products.
• Hotel direct-contract margin improvement: in 2021 built 20+ person hotel direct-sales team; expected to improve hotel category margin by 50% by contracting top hotels directly.
• Car direct-contract: already 40%+ of car volume contracted directly.

• Downloads: 60M+ lifetime installs
• New installs: 2M+ per month
• Organic install rate: 60% of installs are organic
• Annual GTV / GMV: $1.5B in travel and travel-related financial services per year
• App store ranking: #4 free app in North America travel category (behind Uber #1, Lyft #2, Yelp #3; ahead of Airbnb #5, United, Southwest, American, Delta, Booking, Expedia)
• COVID recovery: revenue as of July 2021 is +180% above the pre-pandemic high point (Q1 2020); monthly revenue chart shows clear V-shape recovery Jan 2019 – July 2021, with Jul-21 the highest bar in the series
• 2020 revenue growth: +112% YoY (2020 vs 2019), the only positive performer among major OTA peers (eDreams -80%, Trivago -79%, TripAdvisor -65%, Expedia -57%, Booking -55%, Ctrip -49%, Airbnb -30%)
• Air market share: Hopper North America MIDT air bookings at 150–151% of 2019 levels as of Jun-Jul 2021, vs. OTA comp set at ~50–58% of 2019 levels
• Customer demographics: 70% of booking customers under 35; 25% under 25; skews female in 18-24 and 25-34 buckets
• Fintech revenue share: >50% of total revenue from fintech ancillaries
• Cohort revenue retention: 2020-or-earlier cohorts will contribute 100% more revenue in 2021 than in 2020
• Booking retention: net negative revenue churn; all cohorts (2016–2019) show booking retention above 50% by Year 5, most above Airbnb's S-1 benchmark (~45% by Year 2); 2018 cohort reached ~160% by Year 3; 2019 cohort reached ~165% by Year 2
• Cancel/Change product: 110,000+ travelers purchased CFAR in 2021 YTD
• Cars: grown to ~15% of travel bookings since late-2020 launch
• Funding raised: ~$600M USD private capital; backers include CDPQ, Goldman Sachs, Capital One, OMERS Ventures

• Fintech ancillary margin: described as "high margin" vs. travel commission revenue; no gross margin % stated explicitly.
• Price Freeze avg. revenue: ~$60 per transaction (customer pays; redeemable if they book, so net revenue depends on conversion).
• CFAR pricing: 5–20% of trip cost per transaction.
• Disruption Protection: ~$20/traveler per booking.
• Hotel margin uplift: direct-contract strategy expected to improve hotel category margin by 50%.
• Cars: 40%+ directly contracted, improving margin vs. multi-sourced.

• Direct comps: Booking.com, Expedia, TripAdvisor, Airbnb (lodging), Google Flights (meta-search), OTA incumbents.
• Moat claims:

1. Proprietary price-prediction ML (95% accuracy, built on large historical pricing data set since 2015).
2. Mobile-native distribution - 60% organic installs, low blended CAC vs. SEO/SEM-dependent rivals.
3. In-house fintech underwriting - CFAR and Disruption Protection are risk products Hopper underwrites itself (dynamically priced, no third-party insurer margin leakage).
4. Net negative revenue churn / cohort expansion - booking retention exceeds Airbnb S-1 benchmark; growing cohort revenue contribution.
5. Hopper Cloud B2B moat: once integrated, switching cost for partners is high (API-embedded fintech underwriting + white-label portals).

• No discussion of regulatory/IP protection or exclusive supplier agreements beyond direct-contract programs.

• Key executives: Frederic Lalonde (CEO, Co-Founder), Dakota Smith (CSO), Daniel Calderon (CFO), Ella Schreiber (GM Fintech), Brian Carroll (General Counsel).
• Board: Patrick Pichette (ex-Google CFO, Nova), Laurence Tosi (ex-Airbnb CFO, Blackstone), Damien Steel (OMERS Ventures), Sophie Forest (Brightspark), Jeff Fagnan (Accomplice), Stephen Crawford (Capital One).
• Funding raised to date: ~$600M USD.

• Archetype + why: Hybrid marketplace GMV model with fintech ancillary attach layer, plus a nascent B2B SaaS/API revenue line (Hopper Cloud). The business has two distinct P&L profiles - (1) thin-margin travel transaction revenue (OTA take-rate on GMV) and (2) high-margin fintech ancillary underwriting revenue. These must be modelled separately; blending them obscures the economics. A 3-statement operating model is appropriate given scale ($1.5B GTV). Hopper Cloud adds a third segment modelled as API/license revenue with commission pass-through. No M&A or SPAC structure - standard operating forecast.

• Forecast horizon & granularity: Monthly for Year 1 (2022), quarterly for Years 2–3 (2023–2024). A 3-year view is appropriate given rapid growth rate and uncertainty in Hopper Cloud ramp.

• Key drivers & assumptions:

*Volume / top-line*

• GTV (Gross Travel Value): $1.5B as of deck date; grow at ~80% in 2022 (recovery continuation + car/hotel mix shift), then ~40% in 2023, ~30% in 2024 - tapering as base grows. Flex heavily in scenarios.
• Travel revenue take-rate on GTV: ~8–12% blended (air ~10%, hotel ~15%, car ~12%); industry comps suggest this range. Deck does not disclose.
• Monthly installs: 2M+/month; retention curve built off cohort data - existing cohorts growing 100% YoY in revenue contribution.
• App installs cumulative: 60M; organic mix 60%.

*Fintech ancillary*

• Fintech revenue as % of total revenue: >50%; model at 52% in Year 1, growing to 60% by Year 3 as Hopper Cloud scales attach.
• Price Freeze avg. transaction: $60; attach rate ~15% of air bookings.
• CFAR pricing: 5–20% of trip cost; model at 10% avg. attach; attach rate ~12% of air bookings.
• Disruption Protection: $20/traveler; attach rate ~10% of air bookings.
• Claims / loss ratio on fintech products: ~25–35% (insurance/fintech product typical range; deck does not disclose loss ratios).

*Hopper Cloud*

• Hopper Cloud launched 2021; contributes ~5% of total revenue in Year 1 growing to ~15% by Year 3 as partners integrate.
• API commission rate: ~15–25% of ancillary revenue generated through partners (partner gets balance).

*Costs*

• Hotel direct-contract margin improvement: +50% on hotel category margin modelled as phased in over 2022 as sales team scales.
• Car direct-contract: 40% volume already direct; grows to 70% by end of Year 1.
• CAC: blended $8–15/install (low vs. comps given 60% organic); model CAC on paid installs only (40% of new installs).
• S&M: ~15–20% of revenue (well below Booking/Expedia at 30–40%, reflecting organic advantage).
• R&D / Engineering: ~20–25% of revenue (ML + pricing infrastructure is core).
• G&A: ~10% of revenue.
• Fintech claims & reserves: modelled as COGS against fintech revenue line.

*Retention / cohort*

• Existing cohorts (pre-2021): contribute 2x 2020 revenue in 2021; reversion to ~120% in 2022 as COVID-recovery effect normalises.
• Booking retention Year 2+: modelled at ~65–70% of Year-1 bookings per cohort per year (mid-point of slide 23 range, better than Airbnb).

• Scenarios (Base / Bull / Bear - which variables flex):
• Base: GTV grows 80%/40%/30% YoY; fintech attach rates as above; Hopper Cloud at 10% of revenue by Year 3; claims ratio 30%.
• Bull: GTV grows 100%/60%/50%; fintech mix reaches 65% of revenue; Cloud reaches 20%; claims ratio 25%; hotel/car direct-contract margin uplift fully realised.
• Bear: GTV grows 50%/25%/15% (macro travel softness, competition); fintech attach rates 30% lower; Cloud slow ramp (5% by Year 3); claims ratio spikes to 45% in a disruption event.

• Required sheets / outputs:

1. Assumptions dashboard (all drivers in one place, colour-coded)
2. Monthly GTV build (by category: air, hotel, car, homes)
3. Revenue bridge (travel take-rate revenue vs. fintech ancillary revenue vs. Hopper Cloud revenue)
4. Fintech P&L (premium written, claims, net fintech margin by product)
5. Cohort model (existing vs. new cohort contribution to annual GTV/revenue)
6. P&L (3-statement; IS, BS light, CF)
7. CAC / payback / LTV waterfall
8. Scenario toggle (Base / Bull / Bear) with KPI summary
9. Hopper Cloud segment model (partners, ACV per partner, attach revenue)