In March this year, Reiwa Travel founder Takaya Shinozuka spoke to WiT about his plans to take his new travel packaging startup global and that he was in the midst of raising a new round of funds to power the expansion.
Earlier this week, his company announced it has raised a total of approximately $34 million with SMBC-GB Growth No. 1 Investment Limited Partnership as the lead investor and existing and new investors as underwriters. It has raised approximately $15 million to date, and this latest round of funding brings the total amount raised to approximately $49 million.
The funding is a shot in the arm for the Japanese outbound travel market which has been sluggish given the weak yen, as well as for Japanese travel startups which have not had it easy raising funds in a capital-challenged environment.
Shinozuka’s vision is to build a global platform under his Newt Smart Travel Plan to package “smart hotel, smart flight, smart tour, smart group,” to go beyond its current package (hotel plus air) business aimed at the Japanese outbound traveler.
In a release, the company said the latest funding would enable it to "make bolder investments in technology, accelerate our challenge to fundamentally change the way people travel by utilizing cutting-edge technology, achieving the highest usability optimized for devices, providing information tailored to individuals, etc. Furthermore, we plan to expand our business portfolio by adding domestic travel business, flight reservation functions, and global expansion.”
It added: “We are launching “NEW TML Labs” to accelerate investment in the travel x AI field in order to realize a completely new travel booking experience, such as a travel search experience using generative AI, an AI travel concierge, and dynamic pricing. As one example, we have signed a capital and business alliance agreement with PKSHA Technology, and plan to start a joint project in October.”
PKSHA Technology, a prominent local AI startup in Japan, also invested in this round and Kei Shibata, CEO of Travel.jp and Trip101, a key watcher of Japanese travel startup trends, observed that “this highlights a significant opportunity to transform Japan’s travel industry through AI innovation.”
PKSHA’s representative director Katsuya Uenoyama, said: “We are truly pleased to invest in and collaborate with Reiwa Travel, a comprehensive travel agency with strengths in digital services. With the advancement of generative AI at our back, Reiwa Travel will further strengthen its “digital travel agency” capabilities and support the creation of new travel experiences. We aim to achieve the best communication with our customers by utilizing PKSHA’s dialogue AI technology/algorithm modules.”
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While its focus remains on outbound travel from Japan for now, it has set sights on expansion in other Asian markets.
“In just under two years, we have booked 45,000 tours and expanded the number of areas we handle to 67. To further reassure our customers and accelerate the global expansion of our services, we plan to open overseas bases in Korea, Singapore, Thailand, and other countries.”
Reiwa Travel, which Shinozuka launched to “make it easy for Japanese people to buy packages”, was launched in April 2021, in the midst of the pandemic. Since its founding and through the challenges of surviving the pandemic, it has “confronted issues that need to be resolved in the travel experience, such as the hassle of booking, the complexity of preparation and anxiety during travel," he said.
It launched the overseas travel booking app “NEWT” in 2022.
“As a result of our pursuit of providing a travel experience that is easier and more rewarding, app satisfaction has exceeded 4.6*, total booking volume has broken record highs for eight consecutive quarters since the service was launched, and we have achieved significant growth of 308% when comparing FY2024 1Q with FY2025 1Q.”
In the interview with WiT, Shinozuka said NEWT’s first and main product is its NEWT tour, air + hotel. It offers access to 700,000 hotels through a partnership with Expedia and it has direct connect with hotels in Hawaii.
It plans to expand to flights and group travel including the MICE segment and eventually it wants to expand to the Japanese domestic market to sell domestic hotels and ryokans. “Eventually, I’d like someone like you in Singapore to book a NEWT tour to go to Holland and France,” he explained.
Reiwa is now on a recruitment drive for “team members who will help us grow together during this major turning point for Reiwa Travel."
“We have always strived to design systems that allow employees to work in a flexible manner based on the concept of freedom and responsibility. We will continue to support the further expansion of our organization, strengthen the culture that we value, and update our personnel system so that each member can design their own way of life and work.”
Among its investors is The Creative Fund whose representative partner Takahiro Miura said: “I am happy to be working with Reiwa Travel, which has been extremely helpful to me as a user. Together we will create a way of traveling abroad that is appropriate for the Reiwa era. We will support you as much as possible with our creative power. No matter how difficult the road may be, let’s walk it with a smile.”
*This article originally appeared on WebinTravel.