Travel Tech Startups: Due Diligence Checklist for Investors Ahead of Megatrends 2026

Hook: Why every travel-tech deal needs a 2026-ready checklist

Investors are getting pitched more travel-tech startups than ever — but budgets are tighter and expectations higher. At Skift Travel Megatrends 2026, investors and operators converged on a common frustration: noisy claims about AI, growth, and “network effects” without repeatable evidence. If you’re a VC or angel evaluating travel-tech founders today, you need a focused due diligence and term-sheet playbook that speaks to the realities of late 2025–2026: stricter data rules, accelerating AI retailing, supplier consolidation, and new corporate travel demands like carbon accounting.

Top-line takeaways from Megatrends 2026 (executive summary)

• Data is the moat: First-party travel data and clean integrations now beat scraping and noisy third-party feeds.
• AI is production, not promise: Investors reward teams that ship models with measurable ROI (rev uplift, conversion, retention), not just research papers. See approaches to putting partner-facing AI into production.
• Distribution is king: Partnerships with OTAs, TMCs, airlines and hotel chains determine scale — owning a supply channel reduces CAC dramatically. For a practical comparison, read Direct Booking vs OTAs.
• Regulation matters: Privacy, AI oversight, and sustainability reporting changed contracts and product roadmaps in 2025; due diligence must verify readiness. See the broader economic and regulatory outlook for 2026 when stress-testing models.

How to use this article

This piece turns Skift’s conference takeaways into a practical, step-by-step due diligence checklist and a term-sheet checklist tuned to travel tech deals in 2026. Use it as your meeting checklist, diligence memo template, or negotiation crib sheet.

Due Diligence Checklist — Quick view

Start here on the first call. These items separate the credible founders from the pitch-deck optimists.

• Market fit & TAM segmentation: clear beachhead (corporate travel, short-term rentals, airline retailing).
• Supply relationships: signed MOU/contract or live API integrations with at least one major supplier.
• Growth metrics: 6–12 month cohort retention, CAC, LTV, take rate if marketplace.
• Unit economics: contribution margin per booking and payback period.
• Data sources & consent flows: provenance and consent logs for first-party data.
• AI models in production: metric-driven impact (A/B test results, delta in conversion/revenue).
• Regulatory readiness: GDPR, CCPA/CPRA (US state laws), EU AI Act implications.
• Team & ops checklist: founder travel industry experience and senior hires in product, data, and ops.

Deep Dive: Operational and market diligence

1. Market, segmentation and defensibility

Ask for a micro-TAM that reflects where the startup will win in 24 months. For travel-tech, generic TAMs are often inflated. Break TAM into:

• Category (consumer leisure, corporate travel, regional flights, short-term rental management)
• Channels (direct, OTA, TMCs, GDS)
• Monetizable actions (bookings, managed accounts, SaaS seats, fee-on-top)

Evaluate defensibility in three dimensions: data (first-party flows), distribution (exclusive partnerships, API access), and unit economics (low CAC through supplier referrals or embedded billing).

2. Growth metrics investors must see

Ask for raw cohort tables and be suspicious of one-off spikes. Key travel-tech metrics in 2026:

• Gross Booking Value (GBV) and month-over-month growth — but normalize for seasonality.
• Take Rate / Fees — track both average and by product channel.
• Customer Acquisition Cost (CAC) and CAC payback in bookings or SaaS revenue.
• Lifetime Value (LTV) — incorporate repeat-booking frequency and upsell (ancillary revenue, insurance, seat upgrades).
• Net Revenue Retention (NRR) — especially for B2B/TMC SaaS deals; >100% NRR is a green flag.
• Churn by cohort and season — travel demand cycles can hide retention problems.

Benchmark rules of thumb in 2026:

• Seed-stage travel marketplaces: aim for 10–25% month-over-month GBV growth and CAC payback < 12 months.
• Series A SaaS/TMCs: NRR > 110% and gross margins > 70%.
• Consumer-facing platforms: repeat-booking rate > 20% for first-year users is a positive signal.

3. Unit economics and risk modeling

Travel startups face high refunds, chargebacks, and variable supplier fees. Validate unit economics under stress scenarios:

• Model a 20–40% refund/chargeback surge (e.g., winter storm, airline strike) and check cash runway. Use forecasting and cash-flow tools to stress these scenarios (toolkit).
• Test FX and cross-border margin impacts; many suppliers invoice in local currencies.
• Confirm insurance and catastrophic risk clauses (vendor failure, supplier insolvency).

4. Supply-side diligence

Supplier risk is unique in travel. Look for:

• Contracted supply versus aggregator reliance. A signed contract with a hotel chain or regional carrier is worth months of marketing spend.
• Dependency concentration — >30% of GBV from a single supplier is a red flag unless there’s a long-term contract.
• API reliability SLAs and historical uptime data.
• Capex requirements to maintain integrations (who pays for GDS certification, connectivity?).

5. Technology, data, and AI evaluation

By late 2025, travel tech moved from prototype AI claims to production ML systems that materially improve retailing. Your checklist:

• Is there a productized ML pipeline (data ingestion, feature store, model training, deployment, monitoring)? Consider how they instrument and guard those pipelines (instrumentation).
• Evidence of model performance: A/B tests showing conversion uplift, revenue per session, or cancellation reduction.
• Data provenance: are user consent logs, PII mapping, and retention policies documented?
• Explainability: for AI-driven price or personalization decisions, can the team provide model explainability for partners and regulators? Tie this requirement into partner audit rights and contract clauses (see clause examples below).
• Disaster recovery and drift detection: how quickly can models be rolled back or re-trained after seasonal shifts?

6. Legal, compliance and privacy

Travel tech touches sensitive personal data and payments. Confirm:

• Privacy controls and a mapped data inventory (PCI, PII, travel itinerary data).
• Contracts that allocate breach liability; indemnities and cyber insurance with appropriate limits.
• Regulatory watch: EU AI Act readiness, CCPA/CPRA compliance, and country-specific travel compliance (entry/visa data handling).
• Consumer protections in terms of service (refund policy, cancellations, latent taxes/fees disclosure).

7. Commercial diligence — customers and partnerships

Customers and partners validate demand. Ask for:

• Signed pilots, referenceable customers, and churn reasons.
• Sales cycle length and close rates by channel.
• Partner economics and exclusivity terms (are partners allowed to white-label or compete?).
• Route-to-market evidence: inbound demand, paid acquisition CAC, and partner-sourced bookings. Directory and local listing momentum can be useful evidence (distribution playbook).

8. Team & founder assessment

Founders often make or break travel startups. Evaluate these capabilities:

• Operator pedigree: proven experience in airlines, hotel distribution, or payments.
• Sales & partnership chops: ability to close supply contracts and enterprise T&Cs.
• Data & product leadership: senior hires in ML and product with travel domain knowledge. Hiring and ops benchmarks can be cross-checked with platform reviews like the ATS & aggregator landscape.
• Resilience and runway mindset: pragmatism around seasonality and cash management.

Red flags: founders who are heavy on vision but light on supplier contacts, or who cannot produce cohort tables and raw data for verification.

Quantitative Diligence: Templates and KPIs to request

Require the raw data exports behind key metrics. Ask for CSVs of:

• User cohorts (by acquisition source, product, geography)
• Bookings ledger with timestamps, supplier fees, cancellations
• Revenue ledger (gross, net, refunds, chargebacks)
• Model performance logs (A/B test results, p-values, lift percentages)

Run standard checks: duplicate booking detection, outlier cancellations, and sample API call logs to measure latency and error rates. Use lightweight tooling and templates (for example, a micro-app template pack) to standardize ingestion and checks.

Deal structuring & term-sheet checklist for travel-tech investments

Travel startups have cash volatility and supplier risk — structure the deal to align incentives and protect downside.

Standard investor protections (must-haves)

• Liquidation preference: 1x non-participating is standard for Seed/Series A; consider participating prefs only for high downside risk deals.
• Anti-dilution: Standard weighted-average; full ratchet only in distressed situations.
• Pro-rata rights: Ensure the ability to maintain ownership in future rounds, particularly where supply or distribution is scarce.
• Board / observer rights: One board seat or observer for lead investor at Series A; for seed, a strong information covenant may suffice.
• Information rights: Monthly finance KPIs, weekly growth snapshots during ramp, and immediate notice for material supplier loss.

Travel-specific term protections

• Revenue holdbacks for refunds / chargebacks: Retain 5–10% of net bookings for a rolling 60–90 day period until historical refund rates are validated.
• Supplier concentration covenant: Limit single-supplier exposure to a negotiated threshold (e.g., no more than 25–30% of GBV without board approval).
• Milestone tranches tied to commercial integrations: Release tranche upon completion of a signed supplier contract or certification (GDS/OTA integration).
• Data escrow / portability clause: Ensure that customer and supplier data can be exported in a standard format on termination or acquisition. Consider precedents in cloud and platform exits (news and IPO playbooks).
• Regulatory indemnity: Founder indemnity for historical non-compliance and representation that data consent flows are in place.
• Insurance covenant: Maintain cyber liability and PCI insurance with minimum limits (e.g., $2–5M depending on exposure).

Performance and board-level milestones

Travel tech performance is event-driven. Term sheets should set clear, measurable milestones for tranche releases:

• Integration milestone: production API integration with at least one Tier-1 supplier and an SLA of 99% uptime.
• Commercial milestone: signed annual contract(s) representing X% of projected ARR or a minimum GBV target for marketplaces.
• Product milestone: demonstrated model lift with statistically significant A/B results across randomization arms.

Equity and founder incentives

Standardize vesting with an investor-friendly but fair schedule:

• 4-year vesting with a 12-month cliff.
• Option pool size pre-money clearly defined; avoid post-money surprises.
• Founder clawback only for fraud or gross negligence, not for execution failure.

Practical negotiation examples — clauses to insist on

Below are concise clause examples to include or adapt in term sheets and SPA drafts.

• Supplier Concentration Covenant: "The Company shall not have more than 30% of aggregate Gross Booking Value attributable to a single supplier without Investor consent." (See benchmarking against Direct vs OTA exposure models.)
• Data Portability and Escrow: "Upon Investor request or in the event of insolvency, the Company will deposit a current export of customer, transaction, and supplier data into an agreed escrow location."
• Revenue Holdback: "5% of monthly net booking receipts will be retained as a reserve for refunds and chargebacks for a rolling 60-day period, subject to reduction upon mutual agreement if historical refund rates fall below 2%."
• AI Explainability & Audit Right: "The Company will provide the Investor and key partners with model explainability documentation and grant audit access to production model logs upon 30 days' notice." (Tie to partner onboarding and AI production practices in partner AI playbooks.)

Case studies and examples (realistic, anonymized)

Example 1 — Marketplace that failed to validate supply:

A European short-term rental marketplace raised a Seed round on strong unit economics but had no signed hotel contracts. After a major OTA delisted several high-value partners in late 2024, GBV fell 40% and CAC tripled. Investors lost runway because there was no supplier covenant in the term sheet.

Lesson: demand-side traction means little without supplier certainty.

Example 2 — SaaS TMC with AI-first claim that delivered measurable ROI:

A corporate travel SaaS that embedded a dynamic retailing model in late 2025 produced a 12% increase in ancillary revenue and a 6% reduction in average trip cost for clients during an A/B test. Investors tied the Series A tranche to NRR > 115% and verified model ownership and audit logs — a smooth close in 2026.

Lesson: productionized AI with documented lift unlocks premium terms.

Red flags that should halt a deal

• No raw data or refusal to share cohort exports. Use simple ingestion templates (e.g., a micro-app template pack) to standardize requests.
• Vague supplier claims without signed contracts or production API keys.
• High refund/chargeback rates with no mitigation strategy or reserve.
• Unquantified or untested AI claims — no A/B test or experimental results.
• Founder team lacking travel operator experience where supplier negotiation is core to success.

Advanced strategies for competitive deals in 2026

If you’re competing to lead a deal, use structure to win while limiting downside:

• Milestone-priced closings: Offer a lower initial valuation with priced ratchets unlocking on supplier integrations and commercial revenue milestones. Tie milestones to measurable GBV or integration SLAs and model metrics.
• Revenue-based tranches: Tie follow-on funding to GBV or ARR thresholds rather than calendar dates.
• Strategic partnership structures: Co-invest with a TMC or OTA that can supply distribution; include distribution commitment language (see partnership strategies in platform partnership playbooks).
• Non-dilutive bridge: Provide revenue-based advances linked to bookings to bridge seasonality without immediate dilution.

Checklist: What to include in your diligence memo

1. Executive summary and deal thesis tied to 2026 megatrends (AI retailing, data moats, sustainability).
2. Key KPIs and raw data evidence (cohort tables, GBV, refunds).
3. Supply contracts and API keys evidence.
4. Legal & compliance redlines (privacy, AI, insurance).
5. Term-sheet recommended protections and tranche milestones.
6. Founder assessment and org chart.
7. Exit pathways and comparative comps (M&A, strategic buyers like OTAs/TMCs).

Final takeaways — what to prioritize in 2026

Travel-tech investing in 2026 rewards discipline. Prioritize teams with proven supplier relationships, measurable AI impact, solid first-party data, and clear commercial traction. Be skeptical of inflated TAMs and press-release partnerships without production evidence. Use term sheets to protect against supplier concentration and refund volatility, and require data portability and audit rights for AI models.

Call to action

If you want a downloadable, printable diligence matrix and a sample travel-tech term-sheet appendix tailored for Seed and Series A rounds, subscribe to our Deals & Marketplace Brief. We also offer an investor workshop that converts Skift Megatrends learnings into a one-day diligence sprint your LPs will love. Contact us to schedule a demo and get the template pack used by our investment partners.

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