Wheels Up Raises More Equity as Fleet Grows
Wheels Up has raised an additional $10 million in equity capital in response to what founder and CEO Kenny Dichter describes as strong demand from investors wanting a stake in the new private aviation membership program. Initially, the New York-based company had aimed to raise around $55 million by the end of last year.
As of mid-January, Wheels Up had taken delivery of the first batch of nine Beechcraft King Air 350is from a contract calling for up to 105 of the twin turboprops. Dichter told AIN he expects 18 more 350is to be operational–with Wheels Up operating partner Gama Aviation–by year-end.
On January 13, Wheels Up announced the appointment of FBO chain Skyservice as its exclusive sales agent in Canada. The company, which has bases in Toronto, Montreal and Calgary, will market memberships to Canadian clients wanting to fly to and from Canada and within the U.S.
In another new initiative, Wheels Up has launched a partnership with Young Presidents Organization (YPO), which consists of almost 21,000 business leaders worldwide aged under 45. Through a three-year agreement, Wheels Up has become an official partner of YPO and will provide transportation to support a number of the group’s events.
With 150 members signed up by mid-December, Wheels Up is targeting a membership base of between 350 to 400 by the end of the first quarter. Dichter projects that the year-end total should reach between 1,200 and 1,400 members. Initial membership is priced at $15,750, followed by an annual renewal rate of $7,250. Wheels Up anticipates that members each will spend an average of between $100,000 and $125,000 per year in flight-hour costs.
Over the first few months since operations began in November, the average length of a Wheels Up flight has been between one and two hours and new members have been a mix of individuals and companies. The company’s Wheels Down program, which provides special membership privileges, was preparing to support members coming to New York City for the Super Bowl game on February 2. It block-booked the 114 rooms at The James hotel and was set to host a party at The General restaurant on February 1.