Alaska Airlines is on a mission to solve some of the most pressing challenges in the aviation industry. To accomplish this, the airline has partnered with UP.Labs, a venture lab that recently launched to support startups. The collaboration aims to create a next-generation aviation venture lab that will focus on developing startups to address various aviation travel issues.
Key Takeaway
Alaska Airlines has partnered with UP.Labs to create an aviation venture lab that will develop startups to tackle various challenges in aviation travel. These startups will operate independently and serve the wider aviation industry, with a focus on providing transformative solutions. The collaboration builds on Alaska Airlines’ history of innovation and its commitment to being at the forefront of aviation advancements.
Creating Innovative Solutions for Aviation Travel
Alaska Airlines and UP.Labs announced their agreement to form an aviation venture lab at the recent UP Summit event in Dallas. The lab will foster the creation of startups that tackle key areas in aviation, including guest experiences, operational efficiency, aircraft maintenance, routing, and revenue management. It is expected that the first startup resulting from this collaboration will be unveiled in 2024.
These startups will not be exclusive to Alaska Airlines and are not proof-of-concept programs. Instead, they are intended to be independent commercial enterprises that generate revenue by offering their products and services to the aviation industry at large.
Building on a Legacy of Innovation
Alaska Airlines CEO Ben Minicucci emphasized the airline’s history of innovation, highlighting its past achievements as the first commercial airline to utilize satellite navigation, sell tickets online, and implement machine learning for more efficient flight paths. The partnership with UP.Labs builds upon this culture of innovation and positions Alaska Airlines to continue leading the industry in solving complex aviation problems.
Minicucci expressed confidence that these startups will have the potential to serve a wider market, including competitors, as the focus is on transformative solutions that benefit the entire industry. “We’ve always tried to be the first movers,” he stated. “But you never can keep something transformational to yourself.”
A New Approach to Venture Lab
UP.Labs is not a conventional incubator or corporate accelerator. It operates as a venture lab with a unique financial investment structure, separate from its partner firm, UP.Partners. Major corporations, such as Porsche and Alaska Airlines, are strategically aligned with UP.Labs to establish startups with innovative business models aimed at solving industry challenges.
UP.Labs ensures that corporate partners do not invest more than their pro rata in financing rounds to maintain a healthy ecosystem conducive to attracting top talent and future investors. After a three-year period, corporate partners have the option to acquire the remaining shares of the startup, with the fair market value determined by a third-party valuation firm.
With its successful collaboration with Porsche already underway, UP.Labs plans to establish six companies over a three-year timeframe. These startups are developed to address specific industry needs, with recent examples including Pull Systems, a startup focused on software to manage and automate EV performance, and Sensigo, an AI platform enabling quick diagnosis of issues in software-defined vehicles.
