This article is part of our HHQ members spotlight! Click here to read more
In 2017, China overtook New Zealand as Australia’s largest source of overseas visitors. However, with cultural and technological gaps disrupting bookings, entrepreneurs Ping Wu and Rinat Sadykov saw the need for an efficient solution. Together they founded Cozitrip, a tech and A.I.-powered B2B hotel booking platform that connects Australian and New Zealand hotels with Chinese travel agents.
- China’s booming tourist market
- Cozitrip’s niche: From B2C to B2B
- Bridging the gap between China and Australia
- Finding the right people
- Ups and downs of starting a business from scratch
It’s no secret that Chinese tourists love Australia (Read more in L.E.K report The China Tourism Economy: Reaching Australia’s Potential). Whether it’s the melting pot of cultures, lavender scented teddy bears, or simply the unique sights Australia has to offer, China’s love affair with Australia is a lucrative billion dollar market.
Across a stretch of Pacific ocean, New Zealand has also been experiencing a similar boom and China is poised to become the country’s largest tourist market in a few short years.
But what is that makes Australia and New Zealand so attractive to Chinese tourists?
“There are a lot of reasons,” explains Rinat Sadykov. “I think it’s because Australia is quite a unique travel destination. Korea, Japan, and Southeast Asia are common destinations for Chinese tourists but Australia’s something different, something new, and Australia’s government has been successful in promoting that in China.”
While this is true, Australia’s scenic wonders and New Zealand’s sweeping countryside aren’t the only reasons causing the phenomenon. In fact, the world’s second-biggest economy is currently experiencing an explosion of wealth in their middle class.
“There’s a lot more money in China these days. The Chinese middle class is growing, so more people can afford to travel.”
By 2030, it’s expected that more than a third of China’s population will reach middle class status. As consumers’ income rises, so too does the demand for unique travel experiences.
A graduate of University of Auckland, entrepreneurship has always been a passion for Rinat Sadykov, one half of Cozitrip’s founding pair and Chief Technology Officer.
“All throughout university I had many startup ideas. It was always something I wanted to do. One of the reasons I even started programming was because I liked creating my own things.”
During his free time at university, Rinat and his friends experimented with startups. Although he admits nothing ever took off, a New Zealand e-sports company founded by a friend achieved relative success and Rinat had spent a summer between semesters gaining insights into the startup world.
Shortly after arriving in Australia, Rinat attended a meetup for startups and it was there that he would meet his future business partner Ping Wu.
“He had a few interesting ideas. We started catching up for coffees and after talking more and more we eventually realised that we got along quite well and that we’re like-minded in many ways.
“Ping had had the idea for years. It was quite different, and we both got along on the vision and what we wanted to do and achieve. So we decided, ‘Yeah let’s do a startup!’”
The idea was an ecosystem for Chinese travellers and Australian travel suppliers that could bridge the gap between the two spaces and eliminate inefficiencies.
“In China you’ve got thousand of companies wanting to send their clients to Australia. China’s a booming market, more and more people want to go so more and more companies are popping up. But they’re finding it very hard working with suppliers overseas.”
The pair initially established Cozitrip to support Chinese consumers in booking hotels in Australia and New Zealand, but very soon they realised there was a bigger opportunity in connecting Chinese travel agents to hotels abroad.
“When we travelled to China we noticed there was a high demand for a solution that helped travel agents book hotels abroad, ” Rinat recalls. “We realised that this was a growing market and there was clearly a need to fill that market gap.”
What started off as a B2C A.I. travel booking platform turned into a solution to help eliminate many of the problems Chinese travel agents face when booking hotels abroad.
“We had a big pivot when we moved from a B2C to a B2B business model. The vision was always the same: to offer people a better travel experience through the use of technology. Initially, we thought that a B2C solution was the best way moving forward, but when we looked deeper into it we realised we could have a bigger impact by serving businesses that sell to consumers. It’s just a different path to reach the same goal. “
When it comes to arranging travel, Chinese visitors tend to favour personal interaction when evaluating or making bookings. This means that personalised service travel agents are usually preferred over technology or app-based services.
Unfortunately, many Chinese travel agents are held back by language and cultural barriers when dealing with hotels abroad. To secure an Australian booking, agents often have to go through a maze of services or resort to the time-consuming task of calling up each hotel individually in order to check availability.
Despite its exponential expansion, the Chinese market remains quite traditional and communication is generally limited to phone calls, emails, and WeChat. Furthermore, subtle differences in workplace culture have resulted in inefficiencies in the booking process on both sides.
“Let’s say it’s 9pm in China and there are travel agents still providing quotes which is quite common. In Australia it’ll be midnight and no one will pick up the phone. They need something there, especially when you have language barriers and when they’re trying to pay with Alipay instead of Visa or Mastercard. Contract terms and payment settlements are also going to be different.”
Years of inefficiencies have made it difficult for Chinese agencies to market Australia as a destination and service their clients.
“We’re helping Chinese people come here, but we’re also connecting Australian hotels to a large and growing market. We’ve also found that this is a problem in other countries—so Cozitrip will soon be expanding internationally.”
With any new innovative idea, assembling an entrepreneurial A-team is as challenging as it is essential.
“Everybody’s going to say this but it’s true. It’s crucial to find people who have the right skills and language capabilities, who are domain experts and can offer deep industry insights—it’s all about building the right team.”
One of the larger startup teams at Haymarket HQ, today Cozitrip has offices in Beijing and Shanghai and a diverse team that is working day in and day out to ensure the smooth running of the company.
“I think having a diverse team is good because everyone has different insights. When you think you know something, someone else will come along and show you a different and even better way of doing things. It’s times like this that I think, ‘I’m glad this person came along.’”
In the same vein, Rinat explains that finding the right guidance is just as crucial in the startup journey as it is finding the right people to work with.
“Always find the right mentors and people to learn from. Because regardless of what you’re doing or where you’re at, you’re always going to have something new to learn. You’ll always need to find someone to teach you what the next stage is.
“I do think that in the world of entrepreneurship, and this is my personal take, the value of getting hands-on industry experience before starting up your own business is a bit underrated.”
In a day and age when startups can come and go so quickly, many bright ideas are extinguished due a loss of motivation or plans that become too convoluted before they’re even put in motion.
As they say in China: the journey of a thousand miles begins with a single step.
“Don’t overcomplicate things,” Rinat advises. “Don’t worry about creating a perfect solution—just get something out there. I think a lot of entrepreneurs, especially those coming from a corporate environment, invest a lot of effort into creating the right processes and systems. Whereas, in reality, your goal should be to win your first customer. Do whatever you can to reach that goal—hack it together, put it together with sellotape— just don’t spend all your time aiming for perfection. That would be my biggest piece of advice.”
Recalling from personal experience, Rinat explains how Cozitrip’s managed to navigate the volatile waters of being a startup.
“We started planning everything out but then we would just change things. In the end we said, ‘let’s just do something’ and if it fails then, well, it fails. I’d rather fail quickly and learn from it than than waste valuable resources perfecting something that no one wants.”
There’s a lot to learn when creating a business from scratch. Mistakes or setbacks can be costly but are equally good opportunities to learn. A strong dedication to a vision and a willingness to learn are invaluable qualities.
“The most interesting thing about being an entrepreneur is realising all the ways you can be better. You start off with all the confidence in the world and you think that things will be quite easy. It’s when you get into it that you start realising all of the challenges. But that’s good because it encourage you to keep learning.
“It’s hard to learn out of a book and you can read all the Zero to Ones you want but until you do it yourself you don’t realise how you should actually think. With that, we’re always looking for mentors and investors that can teach us something new.
“You also realise there’s no right or wrong way to do things. There’s a billion ways—I’ve met entrepreneurs from dozens of different backgrounds, each one had a different story, a different way of running a business, a different way of running a team.”
Learning from others and always seeking opportunities to grow keeps Rinat and his team motivated. In the end, it’s important not to lose sight of the goal.
While creating a startup from scratch and watching it grow into a thriving business on its own is the ultimate reward, there are plenty of other inspirations that come with the journey.
“It’s having the vision there and trying to achieve something a bit bigger than yourself. Having a great environment, friends, partners, and even business colleagues, like Ping who is very driven, and our investors who are very motivational, like Joseph Chou (Ironfish)—he’ll inspire you to run to the moon even if you are feeling down!”
Latest posts by Isabelle Lee (see all)
- Bridestowe: on Teddy Bears, branding and winning the hearts of Chinese consumers - April 10, 2018
- Cozitrip: Connecting ANZ hotels to the billion dollar Chinese tourism industry - February 16, 2018
- The Best Coworking Spaces in Sydney - January 19, 2018