To say that the travel industry has been hit hard by the pandemic is an understatement. But Ariel Cohen, the cofounder and CEO of travel and expense software provider TripActions, says his business is already starting to trickle back. His Palo Alto, Calif.-based company took a nosedive last March, with bookings and usage dropping about 90% as travel restrictions were put into place across the globe. That led to the layoff of nearly 300 employees and a difficult reality check for the whole company, which had been in growth mode since its inception, in 2015.
Now, TripActions is trying to jumpstart business with new features that let companies check on virus numbers in specific regions, directly within their travel management system. Last week, Cohen also launched an enterprise-grade edition of his software that is tailored for bigger corporate customers (the company got its start catering to small and medium-sized businesses). This latest version, aptly called Enterprise Edition, is built to accommodate larger employee bases and to be compliant with regulations that some sectors, like healthcare, must adhere to. TripActions says it has added nearly 500 new corporate customers since March, a surprising achievement at a time when most employees are still not traveling freely.
To find out more about how his company is navigating through current challenges and what the future holds for business travel, Fortune recently caught up with Cohen—several weeks after the CEO made his first work trip in months.
Fortune: It’s hard to make sense of the various economic indicators these days. What does your data tell you about where we’re at and where we’re heading?
Cohen: Corporate travel has some dynamics that are different from consumer travel. On one side, since March we have kept adding more customers. Interestingly, a lot of them are large enterprises. On the other side, in March everyone who booked a trip cancelled it.
Then we started to see a slow growth of travel in different areas of the economy. We’re not seeing a lot of tech companies traveling, but some in construction and food companies have to travel, and have been pretty much since late April. In recent weeks, every day has been growing compared to the previous day. But these are still very small numbers. From a usage percentage we are still about 80% down since mid-February.
You recently took your first work trip yourself. What was it like?
I flew to Utah with two colleagues a few weeks ago. Everybody is friendlier, from the TSA agent to the flight attendant. And there was a lot of attention to safety. The airline kept mentioning the process used to clean the airplane. They kept giving us Kleenex to wipe down everything all the time. Seriously, they gave me so many Kleenex. I may fly to New York soon too for a business deal.
A lot of airlines recently announced they were doing away with change fees. Does that move the needle for corporate travel at all?
I love it. When came into the market we wanted to make everything more transparent. I love seeing the industry go in this direction. With corporate travel you can cancel change fees but sometimes you still won’t get the full refund on the ticket. It can be messy. You are dealing with fairly old systems in this industry. I hope [the no change fees] will stay and not just be a COVID thing.
Everyone wants to know what the new normal will be like for everything. What do you think it will be for business travel?
Meeting face to face is super important. I am managing a company and I can see how hard it is via videoconferencing. How do you give somebody feedback over Zoom? These things are hard to do effectively. I do believe people will get back face-to-face meeting. But I think we’ve learned that we don’t need to travel for some things.
You had to make some tough decisions including layoffs earlier in the pandemic. What has the crisis taught you as a leader?
It’s tough. When you’re building a company, the last thing you expect is the need to scale down and to lay off employees. We still think about ourselves as a startup, and when you think about yourself as a startup it’s really hard to lay off employees. The other thing that’s very unique to COVID is that you look at your employees and you know that they are struggling. It’s not easy working from home with kids, or being alone in your apartment. And then there are the race issues in the U.S. We are trying to take a stand from a diversity perspective, and seeing where we can make an impact. [Earlier this summer, TripActions hired writer and activist Shaka Senghor as its head of diversity, equality, and inclusion.]
You’re launching a new product aimed at enterprise customers. Why now?
Two years ago, we started to see more and more big companies starting to use us. We got pulled into the enterprise market. We asked them why they wanted to use us, and how their needs are unique. The “why” was that today, with business travel, you need to stitch different systems together, like booking and travel management and expensing. So you are really stitching together a lot of different solutions. There’s a lot of complexity in the infrastructure and integration of these enterprise systems. We brought all of this together. And we noticed that since March, more of the traditional buyers started to pick us up.
So reading between the lines, are these big companies trying to save costs now by buying your product?
I actually think it’s something else. In March, companies realized that if they’re not using a cloud-based system to manage their processes, whatever their processes are, it is very hard for them to quickly understand what’s going on. There was an immediate need to know where their employees are. Remember that one day when the U.S. cancelled all flights from Europe?
You had one day to adjust and that’s it. If you have employees, you need to know where they are really fast. If you didn’t use a fairly new solution based on cloud technology, you didn’t know what was going on.
