Photo Credit: From left, Gilad Berenstein (Founder, Brook Bay Capital), Cara Whitehill (Vice President, Thayer Investment Partners), Max Niederhofer (Partner, Heartcore Capital), and Skift Editor-in-Chief Sarah Kopit speaking at Skift Data+AI Summit in New York City in June 2025. Skift
The allure of Artificial Intelligence (AI) is undeniable, promising to revolutionize every industry. For travel startups, the potential for AI-driven personalization, operational efficiency, and enhanced customer experiences is particularly exciting. However, three prominent venture capitalists, speaking at the Skift Global Forum, cautioned founders against succumbing to the AI hype without a clear, foundational business strategy. Their advice? Focus on solving real problems first, and let AI be a tool, not the sole objective.
The overarching sentiment from these investors is a call for grounded innovation. While AI can be a powerful enabler, it’s crucial for startups to identify genuine customer pain points and build solutions that address them effectively. Simply slapping an AI label onto a product or service without a demonstrable benefit is a surefire way to alienate investors and, more importantly, customers.
One key takeaway is the importance of building a robust underlying business model before integrating AI. Investors emphasized that AI cannot compensate for a flawed product or a lack of market demand. Founders need to have a clear understanding of their target audience, their unique value proposition, and a viable path to revenue generation. AI should then be strategically applied to enhance these core elements, not to create them from scratch.
Another significant point raised was the need for demonstrable AI ROI. Simply claiming to use AI isn’t enough. Startups need to articulate how their AI implementation leads to tangible improvements, whether it’s increased conversion rates, reduced operational costs, or a more personalized customer journey. This requires clear metrics and a data-driven approach to proving the value of AI investments.
Furthermore, the investors highlighted the potential pitfalls of over-reliance on AI. While AI can automate tasks and provide insights, human expertise and empathy remain critical, especially in the service-oriented travel industry. Finding the right balance between AI-powered automation and human interaction is key to delivering exceptional customer experiences. Founders should consider how AI can augment, rather than replace, human capabilities.
The discussion also touched upon the evolving landscape of AI technology. What is cutting-edge today might be commonplace tomorrow. Startups that are solely focused on adopting the latest AI trends risk investing in solutions that quickly become obsolete. Instead, a focus on developing adaptable AI capabilities that can evolve with the market is a more sustainable approach.
Ultimately, the message from these experienced investors is a pragmatic one: AI is a powerful tool, but it’s not a magic bullet. Successful travel startups will be those that leverage AI strategically to solve real problems, build strong business fundamentals, and deliver measurable value to their customers. A measured, problem-led approach, rather than an AI-led one, is the path to sustainable growth and investor confidence in the current market.
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