Why BlackJet Failed

The Uber for Jet Charters: Why BlackJet Failed

Flex Air Charters Business

BlackJet was a startup company founded in 2012 who had anticipated being the “Uber for jets” by offering clients the ability to reserve on-demand services instantly by accepting annual membership fees for flights to specific destinations in the US. Based out of West Palm Beach, Florida, the company was supported by celebrities such as Ashton Kutcher, Will Smith and Roc Nation founded by recording artist Jay-Z. Burning through roughly, $24 million dollars in funding including the annual memberships of several clients up until its closing in 2016, the company still could not continue operations despite a promising future. In this article, Flex Air discusses why BlackJet failed in 2016 and how others in the private jet charter industry have made up for a lack in instant access to private jet rentals.

What did they set out to do?

BlackJet offered clients the ability to charter private jets by way of requiring its clients to pay an annual fee. This, giving customers the access they needed to a network of jets and individual seats on predetermined routes. While this may seem like the typical idea for most charter companies, the major difference was that clients would only have to pay the one fee and be limited to the flight paths that were available for their reservations. These flight paths predominantly being between NYC and the West Coast, South Florida, and Las Vegas.

Why BlackJet Failed

BlackJet Marketing Campaign

How did they fail?

BlackJet CEO Dean Rotchin blamed investment issues for the closure in an interview with Fortune: “We probably did more with less than anyone but it’s a critical mass business,” Rotchin said. “There’s a reason why ‘critical’ is part of ‘critical mass’.” Along with poor investment choices, Rotchin also noted that a premature announcement of the company’s closing in an article from TechCrunch may also have lead to the acceleration of the final cut. TechCrunch later updated the story with a correction.

However, for many in the industry, this could have been seen, long before the announcement, in the company’s business plan. For starters, the company did not have the access to the aircraft it needed to carry out the charters it claimed it could. The limited amount of routes was also an issue as they called for a specific type of traveler in need of last minute travel only to and from those areas. Lastly, by offering the annual fee at a cost not conducive with what is needed for every aircraft out there, it ran itself out of money too fast. In essence BlackJet was unaware that they weren’t just offering tickets for small aircraft, they were offering tickets for all aircraft.

Why BlackJet Failed

A Now Closed BlackJet Hangar

For other companies in the industry, this is a lesson.

Most charter companies offer other means similar to those proposed by BlackJet to pay ahead and gain the same access to a varied fleet of aircraft. Flex Air is one of those companies. While we offer a pay-as-you-go charter option, we also offer our membership card programs that give our clients the ability to pay first and then use their credit to fly at their leisure. The difference in this and what BlackJet intended to do is that our network is guaranteed, meaning we will always have an available aircraft, we do not limit our clients to the routes they take in their travels and we only work with those Part 135 charter operators that are proven to be dependable and safe.

While we offer options for those flyers who travel more than 50 hours per year such as fractional ownership or leasing, our jet card program is the best option for clients needing last-minute flights throughout the year. Unlike BlackJet and the few other companies that sought to offer on-demand services by cutting price, we charge based on the aircraft and time of year clients are traveling, so they never pay for anything that they have not requested. For air charters done right, turn to the experienced and trusted account managers at Flex Air.

Flex Air provides on demand jet charters and helicopter transfers to clients around the world, if you want an on demand jet charter done right, give us a call at 1-888-722-0776 today.