For Wheels Up CEO Kenny Dichter, Things Are Always Looking Up
Ever wondered why private aviation was the super-expensive plaything of the super-rich?
Serial entrepreneur and networking legend Kenny Dichter wondered the same thing.
He created Wheels Up, which allows members to book flights on an exclusive fleet of luxury private aircraft via smartphone app—at a much lower price point than the cost of owning a private plane.
Dichter, one of the best connected entrepreneurs alive (friends and business partners include Warren Buffett, Tim Armstrong, Serena Williams, Mark Teixeira, and Russell Wilson, to name a few).
He’s also one of happiest business people on the planet – he loves people, he loves jets, and he spends his time with both.
He spoke with HuffPost about how he launched the Uber of the private skies and why he’s such a positive person.
Michael: What’s it like to walk somebody onto a private jet for his or her first flight?
Kenny: I’ll borrow from one of my mentors and partners, Warren Buffett. He said, "Once you fly private, going back to commercial is like going back to holding hands."
Michael: What makes Wheels Up different from other companies in your space?
Kenny: Fractional ownership of jets was revolutionary in its time, but it’s a timeshare model. Everybody wants the same holiday weekends, whether it’s a timeshare in Puerto Rico or to fly somewhere. So I thought, “What if we just bought a fleet of aircraft and you joined us as a member, and you could order up any one of our airplanes at any time?”
I like to say that “We're more Netflix then NetJets.” We're a membership model. We're more like Costco, Amazon Prime, or Netflix. With us, you join for an initial membership fee and then pay a nominal annual fee to stay current.
That gives you the right to book the King Air 350i, which is a fantastic private airplane, anytime with as little as 24 hours notice, to take you anywhere you want to go. The price you pay is radically less than you would if you just booked a private jet on your own.
Michael: How big is your addressable market?
Kenny: We believe 1.5 million people and businesses can interface with our membership model today. Now, when Uber entered the taxi and limousine space in 2009,mthat was an $11 billion market. Now it's about a $55-$60 billion market.
Our market is roughly the same size -- $12 billion -- as taxi and limo was in 2009. So our job as the leading innovator in this space is to grow that opportunity. I think Wheels Up is in position to make our business a much bigger addressable market.
Michael: Do you do that by marketing and attracting more people with the current rates, or do you have ways to reduce the costs?
Kenny: Well, it's both. We quickly recognized that there’s only one airplane, the King Air 350i, that could serve as a flying SUV. Eighty percent of private flights in America are less than two hours in length. The King Air 350i allows us to cut the pricing of a one-hour flight inhalf. That’s because no one ever imagined that this airplane could be used in fleet format, and sold the way we're selling it, with a time and membership format.
Michael: So you're taking an asset that no one thought of deploying in this manner and creating experiences for people that they otherwise either couldn't afford, or they'd have to pay considerably more for, is that correct?
Kenny: That’s right.
Michael: Aren't there only so many landing spots at private airfields, and aren't there only so many pilots?
Kenny: The magic of private aviation is that 90 percent of commercial aviation is done at roughly 100 airports. The private system in America has 5,000 airstrips that we could fly into. So think about the convenience of being able to fly into the city or town that you want to fly into, versus switching airplanes or having a long drive after you land.
Michael: No one else can fly the King Air 350i in this manner except you, is that correct?
Kenny: That’s right. When we made our initial order to start this business, we dropped a $1.4 billion order for King Air 350i aircraft. We worked into that deal exclusivity for North American and Western Europe.
Michael: So you own the planes, you own the market, and you've eliminated the opportunity for real competition.
Kenny: Correct. We still have to be incredible at executing. We have to deliver service, hospitality, connectivity, and convenience, as anybody else would have to do in our space. But we don't have to look over our shoulder, and in essence we own private aviation's opening price point.
Michael: People say that you’re one of the happiest people in the business world.
Kenny: I'm a serial optimist. When I look at the glass I don't look at it half full, I look at it three quarters full. I'm just as happy driving with 1/16 tank of gas in my car, I don't need it to be full to feel full.
Michael: What's your secret? Because if you could bottle that, that's your next business.
Kenny: You have a choice as a human and as a business person -- you can wake up with whatever perspective or lens you want. I just choose to wake up every day and try to figure out what I can do that’s positive. I don't think about the negative. Gravity hasn't figured me out, and I haven't figured out gravity yet. I just like to operate in weightlessness.