How many people in the world can afford to own a private jet? You might be surprised by the answer: not that many. Owning a private jet is a lot of work. Maintenance is expensive, jet fuel is expensive, the crew is expensive – and then there’s the paperwork. For most, chartering a private jet or even flying first class on a commercial flight satisfies their needs.
But Thomas Flohr isn’t like most people – he owns 72 private jets. Flohr was already labelled a disruptor in 2004 when he wanted to offer people an alternative to flying private. Disillusioned by the favoured model of fractional ownership at the time, he commissioned a financial analysis of the industry, pinpointing all the flaws in the system. Many private jets for hire were in fact owner-operated and available for hire only when the owners didn’t need to use them, which meant customers didn’t always get the private jet when (or where) they wanted it. The quality was also greatly inconsistent; many airplanes in service were more than 20 years old.
It was Flohr’s greatest peeve. “Imagine you’re staying in the nicest hotel in Hong Kong, say at The Peninsula’s Presidential Suite for US$15,000 per night,” says Flohr. “You have it for 24 hours. It’s a big purchase decision. And here you are, spending US$15,000 per hour on a flight and you don’t know what you’re getting. It’s a joke! But we’ve resolved that.”
His solution? VistaJet, built on a very simple premise – although the logistics behind it is another story – a flight-hour subscription model across an entire fleet of jets that can fly customers anywhere, at any time, guaranteed. “It’s such an easy value-proposition,” insists Flohr. “Here’s a contract for 300 hours – use them wherever you want, around the world. It’s such an incredible value. And you always know exactly what kind of product you’ll get.”
From a small start-up company based in Switzerland with just three aircrafts, VistaJet rapidly transformed itself into a leading global aviation company with more than 70 mid- and ultra-long-range jets that fly to destinations in 90 per cent of the world. Indeed, it’s an extraordinary feat. Flohr completely broke the industry’s established system.
He thinks it was inevitable, though. “I’d make this example: IBM had 94 per cent market share in the computer industry in 1993 – and that was pre-Google, pre-Dell, pre-Apple, pre-everything. In 20 years, how the world has changed! Every industry at some point in time is going through a massive shift – and I think we have caused this massive shift. We said to forget full ownership, forget fractional ownership; there must be an opportunity to offer you a consistent global experience anywhere, anytime.”
Mindful of his own words, Flohr never stopped elevating his company to new heights. He focused on expanding his company’s infrastructure. In 2012, VistaJet placed its largest order – for 142 Bombardier Global 5000, 6000, 7000 and 8000 aircrafts, 20 Challenger 350 jets plus options – in a US$7.8 billion deal. It was Flohr’s first step towards taking his company global. VistaJet became the first (and remains the only) private aviation company to have succeeded. And the news keeps getting better. In August this year, it was announced that private equity company Rhone Capital was investing US$200 million into VistaJet, valuing the company at more than US$2.5 billion.
“There were a few attempts to try and copy us, but they failed,” says Flohr. “Look, unless you have a global infrastructure worth US$2.6 billion, you cannot try to be everywhere around the globe with 10 or 20 airplanes. It just doesn’t make sense, because you’ll always be in the wrong spot, flying a lot of empty legs, and you won’t have a solid customer base. If you don’t have the size, you lose money – and you can only lose money for so long.”
VistaJet currently has 72 Bombardier Global and Challenger jets spread around the world, and the company employs more than 900 people – including 200 software developers, who work day in and day out to ensure the system runs properly so that clients get their planes when and where they want them.
We were sitting in one of VistaJet’s aircraft, flying between Nha Trang and Hong Kong aboard a Bombardier Global 6000. Just a day earlier, we had flown on the Bombardier Challenger 650 to Nha Trang, spending a blissful and insightful night at the newly opened Amanoi resort. The Aman Resorts are among Flohr’s favourites whenever he’s able to take time for a holiday.
It was a small taste of what it feels like to be a big-shot CEO, travelling on short notice to hard-to-reach locales and holding meetings aboard the jet – although our little getaway was nothing compared to what Flohr goes through every single day. “This is one of the crazy ones,” he says, when I ask him to describe one of his more intense flight schedules. “I was in St Moritz yesterday afternoon until about 6pm and then I took a helicopter down to Milan. I boarded this airplane to Vietnam and now I’m on my way to Hong Kong.”
The majority of VistaJet’s clients fly for business purposes, holding numerous meetings in multiple cities in the course of a day. Flohr, who still looks fresh despite the number of hours he’s been on the plane, calls VistaJet a miraculous invention. “These are time machines. You need to look at these as time machines. And the most successful and the smartest people are using it. What’s the scarcest thing they have? Time.”
Flohr spends an average of one to two nights on the jet, but it’s like a second home for him. Each model is fitted out the same way, with neutral palettes and only the best brands for everything, from its crystalware and cutlery to its bed linens and silk pyjamas. Like every VistaJet member, Flohr gets sole use of the jet, as well as a cabin hostess trained by the British Butler Institute and bespoke in-flight dining from restaurants at the most notable hotels, including Hong Kong’s Amber (from The Landmark Mandarin Oriental) and Nobu. Each time he flies, Flohr wakes up at his destination, refreshed and raring to go.
The tech industry is booming worldwide. Forbes reported last year that there were 698 billionaires in China, much of whom are part of the new wealth in China – rising from tech giants including Tencent, Alibaba and Huawei and more. More young people were also signing up for VistaJet; up to 7 per cent of the company’s sign-ups this year were millennials.
With this in mind, the company saw it as an opportune moment for the company to digitise its platform. At the end of August this year, Flohr’s company launched VistaJet Direct, an app with a yearly membership that will set you back US$10,000, but makes flying private even easier than before.
“We cannot deny there’s a huge digitalisation going around the world – and of course, the app is right in the sweet spot of that digitalisation,” says Flohr. Whereas many companies in the industry push empty-leg flights to their clients – which may not necessarily take them where they want to go – VistaJet Direct makes it easy for clients to look for both empty-leg flights and one-way flights through the same app at preferential rates. All told, it took 18 months to develop the app.
“There’s a lot of market research that my team has done in understanding what clients really want,” explains Flohr. “At first, we were all about the empty leg, like the whole industry was. But we didn’t listen to the industry; we listened to the clients. And the clients were saying: ‘Thomas, I want to know when you have a plane in town; let me fly wherever I want to fly to.’ That’s what VistaJet Direct does. From A to Z, you can get everything approved there. And why can we do that? Because we own the infrastructure.”
Indeed, the app seems to be getting the response Flohr was hoping for. He pulls out his phone to show me the latest statistics. Three weeks into the app’s launch, it already has about 20 active users. Flohr once said that every ten years, a disruptor will come into a market and change things up. He certainly did this some 13 years ago, when he shifted interest in the fractional ownership model to VistaJet’s unique offering.
Has he disrupted himself, I ask, with the launch of the VistaJet app? “That’s a very strategic question – I think our move from a regional player to a global player in 2013 was definitely disruptive in the industry,” he says. “Now that we’re a global player, we must take the leadership in the digital world – and I think we’ve ticked that box with VistaJet Direct. You’ll see us continue to innovate. There’s no sacred ground in the company that can’t be questioned. If companies become fat and happy, it’s usually the beginning of the end. We want to stay lean and smart – and at the forefront of our times.”
This feature originally appeared in the November 2017 print issue of #legend