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 At the forefront

Posted Date: 01/03/2008Issue: Executive & VIP Aviation International March 2008Publication: Executive & VIP Aviation International

 “We are standing at the forefront of a revolution, ” insists Peter Leiman, ManagingDirector and co-founder of Blink. He and his co-founder – Cameron Ogden – usewords like “pioneering” and “innovative” as they enthuse about their impendinglaunch as a Mustang charter operator.

 “Our core value proposition is that you blink and you’re there,” commentsLeiman, explaining the branding. They rejected names that included words like

 “jet”, “executive” or “bird” because they wanted their name to explain theexperience of private jet travel by VLJ rather than describe the process. Essentially, Leiman and Ogden have takeneverything about the low cost carrier market that they perceive to be effective and applied this to their bl ank sheet of paper for the private jet market – which is, they say, highly fragmented and lacking in consistency of service,product or assets employed.

Leiman and O gden are hardly veterans of the air transport bu siness and yet they have put themselves squarely in amarket that is entrenched in traditional values and co mfortable methods of execution; a market that is not alwaysreceptive to change. They are Harvard Business School graduates with investment banker backgrounds whoundertook a private travel proof of concept study for a Fortune 500 company and, so convinced were they by thisresearch, that they decided to plug the gaps in the European executive air travel market themselves. Perhaps theircorporate rather than aviation backgrounds allow them to see clearly what is l acking in terms of corporate air travel

services. Time will tell.For the last 18 months, they have operated under the radar, during which tim e they successfully completed a $30million round of equity funding with European investors. Unlike some US players in the air taxi field, Blink has notspent time and money on building elaborate IT systems or seeking an air operator’s certificate (AOC); the $30million is to accommodate the firm orders for 30 Mustangs that will come on stream at a rate of about one a monthfrom May.

Blink’s imperative

With so many aircraft arriving over a two and a half year period, anyone else might be fazed by the path ahead, butLeiman and Ogden are confident their business plan is unshakeable. Perhaps key to their confidence is theirpartnership with charter and services company TAG Aviation (UK). TAG will operate the Mustangs on its own AOCthroughout the 800 airport destination network the business plan will ultimately support.And the IT systems willcome – Ogden assures us – but with one aircraft arriving each month, it is going to take time to build up anoperation with enough scale to warrant elaborate systems and, when the scale is there, the IT requirements willspeak for themselves and will be accommodated accordingly. A fter all, this is a “per plane” charter plan and not “perseat”, reinforces Ogden; this reduces much complexity from the operation.

Leiman insists this is what corporate Europe is waiting for. He says Blink will save on corporate travel budgets, savetime, make travelling time productive and also accommod ate a lower level of employee when it comes to private –as opposed to commercial – corpor ate travel. But why Europ e? With private jet travel so mature and so accepted inthe US, why launch Blink’s blueprint in Europe and n ot the US? Leiman points to the popul ation densities of Europe,the range of the aircraft, the negative airport experience in Europe and Leiman’s and Ogden’s desire to be continentalrather than regional players. Launching in Europe was a no brainer. “This is a tool,” reinforces Leiman. He says Blink will be quality of life improving and will increase productivity; and all this without having to pay more. Pricing will be

half what a corporate would expect to pay today for a private flight; in fact the four seat travel opportunity will bepriced comparably with four business class fares. For Blink, the race is on to be first to market and May cannot comesoon enough.

Fleet selection

 Anyone considering launching an air taxi operation in today’s environment has – comp ared with a low cost carrier –significant asset choice available to him and yet, for Ogden, the Mustang was the obvious pick o f the bunch. “We aretalking 80 years of proven technology,” he states. This is where established reputations and longevity can clinch adeal in today’s market. O gden points to Cessna’s ability to stay afloat and the serviceability of the aircraft itmanufactures. There are 12 Cessna service centres available to Blink as the aircraft require maintenance and thisaffords huge comfort to Blink as it embarks on its first forays as a charter operator.

 Also, the operating economics of the Mustangs meet Leiman and Ogden’s approval and the short landing distance of the aircraft means it has access to a large number of European airports. This is important as Blink’s plan is todevelop a primary and secondary hub system within identified European regions. So, for example, the first base willbe Farnborough Airport – as you would expect with TAG as a partner – which will support secondary hubs withinthe region over time. The model will be replicated around Europe and perhaps beyond if the demand is there. Giventhat it will take time to build this fleet of Mustangs, Leiman is aware that although the brand should be heraldedloudly, the management of the fleet as it is built requires a firm hand. “We need to introduce constraint into thisnetwork,” he says emphatically. After all, too m uch ambition in terms of locations too early on and the businesscould spiral to Blink’s future disadvantage.

Leiman and Ogden are clear they are going to have to manage demand. “We want to ensure we can deliver,” is their

 joint message. Blink is very much about providing a customised solution to corporate customers – in effect, they willoperate, especially in the early days, as an outsourced corporate flight department. So with Blink the proud achieverof $30 million in equity and holder of 30 firm orders for Mustangs, is the company any more than an assetmanager? The impl ication in this question is swiftly batted away. Leiman stresses that not only does Blink own theequity and the aircraft, it also has control of the customers. The partnership with TAG is very much like that between

 Air Foyle and easyJet in the early days of this low cost carrier’s operation, but the business is most definitely Blink’s.

Horizons

 Anyone m oving into the air taxi market is entering uncharted waters and yet the business imperatives are compellingand the mood buoyant. T he challenges lie perhaps in the hangaring of so many assets, the training of so m any pilotsin an already scarce market and the dependence on the corporate world continuing to deliver shareholder valuethrough enhancing private as opposed to commercial air travel.Lieman and Ogden are up for the challenge.

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 At the forefront

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