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The top airlines startups use in the U.S.

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Flying across the country probably isn’t considered a fun part of the experience of running a company. You end up stuck in security lines, dealing with flight delays, and all the other pains of trying to get from point A to point B by way of a typically not-so-comfortable flying aluminum science machine.

But travel remains a critical part of running any startup. You might start in your home city, but find yourself bringing on talent outside of your city — or abroad. You might have to sign partnerships on the other side of the country, work with agencies in different major metro areas, and eventually end up with teams distributed all around the country. All these conversations are usually better done in person, as we all know.

In the United States, several airline brands vie to be the top choice for companies across the U.S. Each have their own rewards programs, offer unique benefits, and have their own reputation depending on who you’re talking to at the moment. Still, it generally pays off to be loyal to one airline — with the financial and lifestyle advantages compensating for warts. So startups must choose their airline carefully when they’re getting started.

To get a better look at what’s happening, we dug into Brex data to see where startups are deploying their capital to fly from city to city. Brex customers are primarily early- to mid-stage startups, though we have an increasingly broad set of ecommerce and life sciences companies following our recent product launches. 

The results we found were a little bit of a mixed bag: some of what you’d expect, and some that you might not.

Hub airlines win in the major U.S. cities

It probably won’t come as a surprise that Brex customers opt to go with airlines that have a hub in their major city. No one likes to fly on a segment with a stop (or worse, multiple stops), and hubs serve as a good way to ensure that you’re flying direct to your location. There are sometimes multiple “hubs” in major cities. We can see an interesting diversity of airlines at the top depending on where you’re flying — and no clear and distinct leader.

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We can see that Delta, American Airlines, and United all frequently account for the highest spend across major cities. But Alaska Airlines and Southwest are also popular options among Brex customers. JetBlue, too, has captured a fair bit of momentum on the east coast (which we’ll see in a little bit more detail below). 

Digging into airline usage in San Francisco and New York

San Francisco represents Brex’s largest market, while New York is our second-largest market. When we dig into the San Francisco market, we can see that United is a definite leader when it comes to startup spend on airlines. San Francisco sits in a unique spot as both a gateway to the rest of North America and eastern Asia. You might have spotted a round-trip flight to Beijing in the $500s, or other cities in the region. That’s going to be an important factor for any startup that has any operations in Asia when it comes to their airline choice. After United, we can see that Delta and American Airlines come up next.

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While Southwest makes an appearance in the top for San Francisco, JetBlue takes the fourth-place spot in New York. When it comes to New York, the home of three airports, United ended up in third — probably because it is, indeed, a pain in the (noun) to get from the city over to Newark International. (To be fair, the Queens-Midtown express and Grand Central Parkway these days aren’t much better.) The top three in New York are slightly more evenly distributed compared to San Francisco, with hub airlines Delta and American Airlines taking the top spot.

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Both of these cities represent regions where startups are thriving, and also demonstrate that there seems to be considerable competition among the top airlines to capture spending from Brex customers. These are the kinds of companies that the airlines will likely hope to win early and hold as they grow into larger companies — and as their travel needs inevitably expand.

Ready for takeoff

While startups may want to find an airline they prefer, as companies start to get larger, employees may increasingly have a say in their preferred airlines. If you’ve ever worked at a larger company, you’ve probably put your information into Concur and picked your favorite airline (likely to capture the miles). That’s where another factor for companies comes in: rewards for points.

Many corporate cards (including Brex) offer companies rewards for their card usage. Those points can then go toward travel, which gives startups a little bit more flexibility in their airline selection when they need to travel. Getting status is still probably a good idea as the perks are often helpful for frequent travelers. That flexibility can also be beneficial for startups that are trying to save money as they are getting off the ground.

Ecommerce companies today likely have to deal with a complex network of suppliers around the globe, while startups may find themselves working with talent abroad. Getting a great deal on travel has never been more critical for companies as problems become increasingly global.

About Brex

Brex is transforming B2B payments by creating corporate cards, rewards, and travel programs that are tailored to specific industries, like startups, ecommerce, and life sciences. In 2018 Brex launched the first corporate card and rewards program specifically designed for startups. By rebuilding the credit card tech stack from the ground up, Brex is able to reimagine every aspect of corporate cards, including underwriting, transparency, and approvals, to create a radically better experience for customers. Brex is backed by Y Combinator Continuity, Peter Thiel, Max Levchin, and more, and has raised $315M in equity and $100M in debt capital. The company’s headquarters are in San Francisco.

We've also partnered with Ascenda, the leading global innovator in loyalty technology and services, to enhance our rewards program so customers can redeem their Brex rewards points for airline miles

We’re still early, and we welcome as much feedback as we can get. Also, we are hiring like crazy. Check out any openings we have!

Methodology

Brex examined customer spend for airline expenses to get a better sense of airline usage among Brex customers. Share of spend is defined as the total spend in Q1 and Q2 combined on a specific airline over the total spend for all airline expenses. Airline expenses are defined as transactions categorized to an airline, which may include additional expenses beyond plane tickets. We do sincerely hope that checked bag fees have not become so high that they account for the majority of spend, and that our customers are making responsible purchases while in the air.

As part of its underwriting process, Brex maintains visibility into the spending of companies that use its products. Companies who asked that their data not to be shared were not used, and any company that does not wish to share its data for future aggregated analysis may request to exclude it from being shared in the aggregate.

Photo credit: Eduardo Velazco Guart on Unsplash

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