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Smart Destinations Gets $4.25M Series A To Expand Its Tourist Smart Cards

source: Dow Jones VentureWire

by Marine Cole

May 4, 2005

Smart Destinations, which offers tourists unlimited admission passes to attractions in various cities, said it has raised $4.25 million in a Series A round of financing.

New investor North Hill Ventures, the investment arm of Capital One Bank, led the round with $2.6 million, while new investor Zon Capital Partners provided the remaining amount.

Proceeds from the round will be used to offer passes to more destinations. Smart Destinations' Go Card USA is currently available in Boston - the first city it launched, in July 2003 - San Francisco and Seattle. It will be launched in Chicago on May 20, in Orlando on May 31, and in San Diego on June 10. Three more cities will be added later in 2005 but they haven't been disclosed yet. Smart Destinations will also use the financing to expand its sales channels in each market.

Kevin McLaughlin, co-founder and chief executive of Smart Destinations, said the round closed last November but the company waited to announce it as "we were really focusing on getting our cities up and running and we wanted to work in a quiet mode."

Tourists can purchase Go Cards through more than 1,000 distribution partners and affiliates including Virgin Holidays, part of the Virgin Group; American Airlines Vacations, part of AMR Corp.; Southwest Vacations, part of Southwest Airlines Co.; The Mark Travel Corp.; National Leisure Group Inc. and tour operators such as Expedia Inc., Travelocity, part of Sabre Holdings Corp.; and Orbitz, owned by Cendant Corp.

Adult prices range between $39 for one day and $139 for seven days, which include admission to 20 to 60 attractions - museums, historic sites and excursions - in a single market. While no value is actually stored on a card, Smart Destinations offers discounts at selected stores and restaurants if tourists present the card. The card is also provided with a guide book on the specific city.

For the venue partners, the Go Card brings additional visitors, while for the distribution partners, the sale of the Go Card brings a new revenue stream that they previously couldn't get.

Smart Destinations' closest competitor is CityPass, a ticket booklet containing an admission ticket to top attractions in New York, Boston, Philadelphia, Chicago, Seattle, Hollywood Walk of Fame, San Francisco, Southern California and Toronto. "We sit alongside," McLaughlin said. "But they're not geared for visitors. They go after the local market." CityPass, which first launched in 1997, offers a choice of six museums valid for a minimum of nine days.

Founded in 2003, Boston-based Smart Destinations currently has 25 employees and plans to add 25 to 30 employees by the end of the year.

McLaughlin said the company doesn't have specific plans concerning a Series B round at this point. "We don't have to raise more," he said, "unless we decide to grow to more cities faster."

As a result of the round, Brett Rome, general partner of North Hill Ventures; and Michael Forgash, managing partner at Zon Capital Partners; have joined the board of Smart Destinations, which also includes McLaughlin; Steve Boulanger, chief financial officer at Engim Inc.; and Melissa Snape, vice president at Collette Vacations.

___
On the Net:
Go Card: http://www.smartdestinations.com
OmniTicket: http://www.omniticket.com
Travel Industry Association of America: http://www.tia.org.

For more information, see www.gocardusa.com.

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