🗺️ Journey: Building Star Alliance for Independent Hotels

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Read time: 4 mins 18 seconds

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Happy belated Thanksgiving to those who celebrate :)

Feeling extra thankful for all of you for being part of this amazing community. 

Because of you beautiful people, I have been able to meet and interview some of the best founders in the world.

One of the most impressive founders I have met lately is John Sutton. 

He built Red Ventures into a $10B+ business as the Chief Digital Officer. Retired at 40. Played professional beach volleyball for two years and then un-retired himself last year to build Journey with $15M in seed funding. He is going after Marriott Bonvoy and Hilton Honors by creating a loyalty program for the independent hotels. 

Oh yes… he also has the best hair of the 500+ founders I have interviewed for this newsletter.

Excited to share John’s story today.

John has been in the marketing game for many decades, with his most prominent role as the President & Chief Digital Officer at Red Ventures, the quiet giant behind brands like CNET, Healthline, and The Points Guy. 

His core insight from over a decade of building that business was that whoever can win the conversion game can win the marketing game.

At Red Ventures, this meant a maniacal focus on personalization. They owned over 2 million unique phone numbers. When you clicked on an ad for DirecTV, you'd see a unique number. When you called, the system instantly knew what ad you came from and what you wanted. Instead of asking "How can I help you?", the agent could say: "Hi! I see you're interested in NFL Sunday Ticket..."

Those little personalization touches made a massive difference in conversion rates. If you can double conversion, you cut your CAC in half. 

This obsession with customer experience helped turn Red Ventures into a $10 billion+ powerhouse that never took primary capital and threw off hundreds of millions in EBITDA every year.

In 2021, John retired at age 40 and started pursuing his dream of playing professional beach volleyball. He spent two years on the circuit, playing with a gold medalist.

And of course… the itch to build never left.

While traveling, he noticed something broken about the hospitality industry: 

1/ Big hotel chains like Marriott and Hilton sit on a huge amount of guest data, everything from spending patterns to preferred room temperature. Yet, very little of it is used to personalize the stay. Guests still end up with a generic, copy-and-paste experience.

2/ Traditional loyalty programs have become too transactional, and constant point devaluations have eroded trust. As a result, consumers don’t feel loyal to the hotels anymore. They just follow where the points are, which often means their credit cards, not the hotel brands.

His first idea was a loyalty program for high-end Airbnbs.

The Airbnb experience can feel disjointed, with no real curation standard beyond a few scattered reviews. He saw an opportunity to build a curated network of premium homes and reward guests every time they stayed in-network.

To get some feedback on the idea, John called Brian Kelly, the founder of The Points Guy, whom he'd gotten to know when Red Ventures acquired the company in 2017.

Brian told him to think bigger. The same issues — reliance on OTAs like Expedia, lack of guest data, weak loyalty — were even more painful for the world's best independent hotels and resorts.

That was the lightbulb moment.

John's vision shifted to building the "Star Alliance for independent hotels," a network that helps unique properties compete with the giants by offering a more personalized, elevated experience.

For guests, it offers a new way to earn and redeem rewards across independent properties. For operators, it delivers AI-powered tools to personalize the guest experience, boost direct bookings, and cut reliance on OTAs, which can take up to 30% in fees.

John knew he had to solve the classic cold-start problem in this two-sided marketplace: you need hotels to attract guests, but you need guests to attract hotels.

He decided to focus on the supply side first. High-quality independent hotels already have strong built-in demand, so winning them over would create the foundation for everything else.

1/ Start with a Figma pitch

John started with a Figma prototype to pitch his vision of launching a loyalty program for independent hotels.

He reached out to his network and asked: "Does anyone know somebody who owns a hotel?" Brian Kelly introduced him to Chris Burch, the billionaire founder who owns Nihi Sumba, the number 10 resort in the world. Through other connections, he also got in touch with the CMOs and COOs of top luxury resort groups like Auberge and Rosewood.

However, he faced rejection right away.

They told him their wealthy guests don't care about loyalty and that loyalty programs cheapen the brand. One CMO flat-out called it a "terrible idea."

John was confused. He was their customer, an Amex Black card holder who stayed at their hotels. And he cared about value.

He realized the problem wasn't the product; it was the pitch.

2/ Reframe the Pitch

John stopped talking about points and discounts. Instead, he started pitching Journey as an elevated brand that was about access, status, and value just like American Express.

He also backed it up with stats:

Suddenly, the hotels started listening.

3/ Find the right outbound motion
John knew cold emails wouldn't work in a relationship-driven industry, so he got creative.

He would book a room at a target hotel, paying the regular rate.

When he arrived, he'd simply ask, "Can I meet the GM?"

Most of the time, someone at the front desk would check, and the GM would come out for a quick chat since he was a customer.

John would grab a coffee or a drink with them and pitch Journey. He signed a surprising number of hotels this way.

4/ Buy distribution
To speed up his network-driven strategy, John made a smart move.

He found Zach Busekrus, who ran a well-regarded hospitality podcast called Behind the Stays. Zach interviewed founders and hotel CEOs, and the show had built real trust in the space. 

Instead of doing a partnership, John acquired the podcast and hired Zach, instantly giving Journey direct access to thousands of hotel decision-makers and a platform to reach them.

They have now partnered with over 75 of the top high-touch hospitality brands across the World, as the official loyalty program for over 1,900+ properties.

John and his team have acquired over 1 million guests without spending a single dollar on marketing.

They were able to achieve this by turning the supply into their distribution channel, a strategy inspired by Bilt, which turns rent payments into rewards.

When a guest checks into a Journey partner hotel, they're invited to join the program. 1 in 3 guests joins today.

The Journey platform officially went live a few months ago, with 75 brand partners and 1,900+ properties onboarded. There are now over 1 million guests in the system and growing fast. 

The company has secured $15 million in seed funding, co-led by Headline and First Mark with participation from Lerer Hippeau and Slow Ventures, plus individual investors including, The Points Guy founder Brian Kelly, Bulletpitch, Tory Burch co-founder Chris Burch, and entrepreneur Kim Perrell. 

1/ Reframing the pitch might be all you need. You don't always need to change your product. Sometimes, you just need to change your words. Journey went from a "terrible idea" to a must-have by changing the pitch from "points" to "relationships."

2/ Find the right GTM motion for your industry. Don't just default to cold emails. Understand your industry. For hospitality, a high-touch, in-person approach was far more effective and built a stronger foundation. John's "stay at the hotel and ask for the GM" tactic was perfect for his target market.

3/ You can buy a network. For a small initial investment, Journey bought a podcast and instantly acquired a priceless network of hotel CEOs. Think creatively about how to jumpstart distribution and access. 

4/ Find your zero CAC growth loop. The holy grail of startups. Journey solved the cold start problem by turning its supply (hotels) into its biggest and cheapest customer acquisition channel. 

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See you next Tuesday,

Leo

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