Private equity firm Novacap has invested in merchandizing platform provider Plusgrade to scale its ancillary revenue solutions.
Although terms of the deal were not disclosed, Novacap says in a release that it acquired a “substantial equity interest” in the Montreal-based company.
Plusgrade, founded in 2009, helps airlines, cruise lines and rail operators manage and optimize revenue generated from seat upgrades and other premium services.
Plusgrade’s products are fully white labeled and integrate into existing reservation systems. It counts more than 70 partners across the air, cruise and rail sectors, and the company claims it has been responsible for generating billions of dollars of new revenue opportunity for travel suppliers in more than 50 countries.
Amid the pandemic, Plusgrade launched a Dynamic Seat Blocker tool for airlines, designed to capture incremental revenue for carriers and meet the requirements of passengers flying in a COVID-19 environment.
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"Plusgrade is a unique income generator that creates significant incremental revenue from missed opportunities, making it an ideal solution for a wide range of businesses, especially in today's transformed post COVID-19 market,'' says David Lewin, senior partner at Novacap.
"[Plusgrade CEO Ken Harris’] leadership in creating and growing a new billion-dollar category positions Plusgrade as an incredible solution for its customers, able to meet demand on a global scale and assert the company's leadership in a niche industry with inherent long-term growth.”
Says Harris: "Our partnership with Novacap brings together their experience and industry insights with our hunger to strengthen our core and create new categories that drive meaningful ancillary revenue through incredible customer experiences. We look forward to Novacap joining our board as we expand into exciting new products and verticals in the next year."
Following the transaction, Caisse de dépôt et placement du Québec (CPDQ), which took equity in Plusgrade in November 2018, will remain a major investor in the company.