Upgrade pack told investors on the Seedrs investment platform that it’s closing up shop, after more than £10m in investment resulted in zero beta apps, zero airline or hotel partners and at least 3 global offices, with plans for a fourth, and luxury travel in between.
The startup, which purported a solution to simplify travel upgrades has been mired in controversy over reports of gross mismanagement and allegations of fraud, which will only continue amid new insider statements and whistleblower accounts.
Upgrade Pack To Close Shop
Few travel startups “make it” in the end, but most at least make an app to prove, or disprove concept first. Even if it never reaches the public, a private beta is customary, and was promised to early Upgrade Pack investors in early 2019.
This, and insinuations made by the company in newsletters to backers is precisely the reason investors are now looking more closely into Upgrade Pack, after more than £10 million investment was lost.
Over £500,000 in seed money raised by individual investors on Seedrs has also been lost, with many in the frequent flyer community taking a total loss. Failure has been blamed on covid-19.
Upgrade Pack claimed to be engaged with 69 airline and hotel partners worldwide in more than 30 global markets. Company insiders tell GSTP that as of November 2nd, 2020, the day the company folded, not a single airline or hotel partner had actually been signed, and the company was creatively using the word “engaged” to convince potential airlines and hotels to sign on.
Even then, it did not work.
With zero airlines or hotels signed onto the platform, no beta apps, launch apps or upgrades sold, that didn’t stop the company from opening and planning a variety global offices in London, Edinburgh, Toronto and Singapore.
What was Upgrade Pack trying to do?
Upgrade Pack could have potentially been attractive to airlines and hotels in a different time, based on the no fee or commission structure offered to each. The travel app was to simply serve as a closed marketplace for airlines to dump premium cabin inventory without any commission or fees charged to the business.
It also absolutely could have been attractive to consumers, who would receive the app for free via credit card of company perks, with potential savings on upgrades, though special airline and hotel offers via their own apps would typically be significantly less.
To make money and acquire users, Upgrade Pack planned to sell its service to banking platforms, particularly in the luxury credit card market as a “perk”. This would be used to create a user base of affluent travelers. Whether affluent travelers regularly need or will pay for upgrades, or the entire fare difference to achieve one is another matter.
The concept was flawed but with partnered acquired, it could’ve seen some success. There was just one problem: it never could have worked, according to employees.
Many companies have strict corporate travel policies prohibiting certain cabins from being booked, and at the right price, it could have given travelers an “easy” solution to click a button and move into a better cabin, without breaking policy by paying for the better cabin themselves.
We say could have, because no app was ever launched, even to private testers, so no one will ever know. Company insiders say that’s simply because the “technology never worked”. Responding to the technology claim from another employee, a separate UP whistleblower offered the following…
This is true and if the co-founders would have done any research at all prior to setting up the company / launching it, they would have very quickly discovered that it’s not technically possible for a third party to move a customer between cabins without that 3rd party becoming the agent for the ticket.
Just imagine if you booked a ticket through your American Express Travel Agent and then used Upgrade Pack to upgrade your seat, Upgrade Pack would then become the agent for the ticket. If you wanted to make another change and called AMEX, they wouldn’t have a record anymore. That’s why airlines never signed up. It’s basic research any founder should do prior to hiring 30 people and then telling the tech team to “figure it out”. If you have contacts at Amadeus or Farelogix, they can verify this.
A Year Of Murky Questions Not Related To Covid-19
In marketing materials designed to bring in airline, hotel and banking partners, the app still makes a claim so dubious, one must laugh. Despite no app, not even a private beta app, or selling a singular upgrade of any kind at any point even to themselves, Upgrade Pack claims the following on its website.
“An unrivalled source of ancillary revenue, we’re on track for almost $5bn of ancillary sales by the end of 2020.”Upgrade Pack
Perhaps they meant the entire airline industry?
Like many elements of this questionable app, claims of banking partners signed on to the app proved to be nothing more than hot air, with nothing more than standard NDA agreements to mark conversations, rather than signings. Two years: no app, no clients and no private beta, despite 2 years of promises.
GSTP originally looked into claims of potential fraud at Upgrade Pack after numerous launch delays and failed promises dating back to times before covid-19 was a word anyone had heard.
Upon reviewing original statements made by Mr. Unsworth in a 2018 pitch for media coverage, the app claimed to have multiple airlines and banks already with signed agreements. All have since been proven false. When pushed for confirmation of these partners, the app became hostile and put out a press release attempting to discredit GSTP.
Upgrade Pack did not make a singular sale at any point in time. No upgrade was ever purchased through the app. No airlines or hotels ever signed on.
Whistleblowers inside the company first alerted GSTP to allegations of fraud and gross mismanagement in February of 2020, following public frustrations raised by GSTP in regards to promises to our readers not being delivered.
Company insiders say this negative coverage lead to the creation of a dubious new holding company potentially designed to siphon away remaining funds for personal gain, called ‘Board Advise Trading Ltd’, opened immediately after the story broke. The new company is owned by Craig Unsworth, the founder of Upgrade Pack, and an exact relationship between the new venture and old venture is unclear.
It’s not all bad news for Upgrade Pack though. CEO Craig Unsworth bought himself a luxury townhouse in Edinburgh with cash during the year, in between first class flights billed to the company. The townhouse is said to be a primary reason for setting up a second UK office in Edinburgh, despite 2020 being a year of “work from home” around the globe.
Our thoughts go out to the employees of the company who worked their hardest to create a success, despite questionable information from leadership, all of whom must now find work once again.
Four offices, zero apps, zero upgrades and £10m of investor money lost. That’s the end of the Upgrade Pack story, for now. To get in touch with the author: email@example.com