Well, one thing is for certain. David Neeleman's successes have earned enough confidence and goodwill in the airline industry to secure funding, even though his new venture is struggling.
Breeze Airways secured $200 million in Series B funding on Wednesday, a positive sign from the investment community in the carrier's business model, according to the aviation blog The Points Guy.
Neeleman, who founded the ultra-successful JetBlue Airways 20 years ago, is now running the low-budget startup. Breeze began flying in May but by late July was struggling.
Breeze had to pare back its schedule in several cities, including San Antonio; Huntsville, Ala.; Norfolk, Va.; and Charleston, S.C.
Ostensibly, Breeze's business model was to fly in and out of secondary and/or underserved markets, but two months into its venture the airline had to cut frequencies on 33 percent of its routes and has also temporarily suspended five routes.
Neeleman told TPG in an interview Wednesday that those cuts were not a sign of a problem with the business model. Instead, they were part of normal startup growing pains.
"Really it was just that we bit off a little bit more than we could chew," he said. "I wanted more spare coverage in the system and wanted to be able to run the operation better. It caused a little bit of discomfort, but we compensated our passengers really well. I just want to run a perfect operation.
Nonetheless, Neeleman received the ultimate show of confidence from investors with this latest round of funding, particularly as other airlines are admitting that the new delta variant of the COVID-19 virus is impacting future bookings.
Breeze launched service on May 27 with 30 routes in 16 U.S. cities.
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