Former Priceline chief scientist and LIFE Rewards founder Eddie Ibañez explains his vision for the start-up that is developing its model using blockchain and NFTs that will empower users to 'flex' and benefit directly from their travel purchases
Company Profile: LIFE Rewards aims to be the Web 3.0 secondary market for travel
The proliferation of TikTok videos about websites ‘that feel illegal to know’ because of their ‘insane capabilities’ indicates we’re in the midst of a period of rapid digital change.
Fuelled by Artificial Intelligence, blockchain and NFTs, the early buds of the Web 3.0 revolution are becoming discernible in what looks like a real-time sandbox of innovation.
The scramble to be one of the early winners is on, and LIFE Rewards is out of the starting blocks aiming to establish a StubHub or ebay secondary market for travel products.
Founded by former Priceline chief scientist Eddie Ibañez, the site offers hotels having integrated multiple suppliers and is working on flights for launch later this year before moving on to events tickets.
“We're using technology to give people a re-sellable market,” says Ibañez. “look at the evolution of tickets for events or sports, they had a primary issuance from the creator.
“Then they went to having marketing help with sites like Ticketmaster driving consolidation, and then they evolved into a secondary market with the likes of Stubhub.
“So, following that same track with travel is what we believe the evolution is. We're creating a secondary market for travel, starting with hotels.”
What LIFE is essentially doing is taking a static, illiquid asset – a hotel stay – and breathing life back into it after purchase, making it liquid for the purchaser.
But is there really the potential for a flourishing secondary market for travel? Will people buy hotel stays or trips speculatively before deciding whether they really want to travel?
Ibañez said the focus for LIFE is on higher-end four- and five-star properties which have much greater price elasticity than downmarket alternatives.
Rates can rise three to four times if, for some reason like a major event, demand soars so holders of room nights will be able to enjoy the financial reward of that spike in demand.
“When a hotel is sold out it's sold out. So you could arbitrage this, make money off of it, by giving someone the opportunity to pay a premium to stay there,” says Ibañez.
What makes this possible is trading hotel stays on LIFE’s own blockchain as Non-Fungible Tokens (NFTs) which gives any asset an immutable digital identity and verified value.
After COVID, LIFE saw the opportunity to apply this to the hotel night providing customers with greater flexibility and control and suppliers with guaranteed revenue opportunities.
A verified digital travel wallet for generation flex
There’s a clear opportunity for using NFTs and blockchain to drive loyalty, and LIFE started out in the early development phase as an interoperable coin rewarding network loyalty.
Verified digital ownership also lays the foundation to exploit gameification and ‘flexing’ in the Web 3.0 era as well as the establishment of a viable secondary marketplace in travel.
“When we were ideating, I was thinking about social media and why people post on Instagram. They’re flexing. They’re saying look where I ate, look where I went, it’s perfect.
“What's cool about blockchain is it's verified. You can say, look, I really went there, here are my old memories, I got a reward for doing that. And then you can flex.
“People will say that's a five star wallet, you must really care about travel. The idea that you can flex and show off a wallet is cool and what we’re doing plays along with that.”
Ultimately, Ibañez says he wants the LIFE NFT to become the most desired and iconic token for travel in any metaverse, effectively the default currency for travel in the Web 3.0 era.
“With every booking you are going to get an NFT artefact you will keep in your wallet. So it’s important that we make that look cool.
“The most fun and the most difficult thing is coming up with unique art for what you get. We're starting out taking what the hotel provides and jazzing it up using technology.
“I don't want to be the metaverse, but I’d like us to be what everybody uses for travel in the metaverse so people know the only way you can get that cool artefact is to earn it on LIFE.”
Incentivising and rewarding with Da Vinci Code-esque travel quests
Collectable LIFE NFT artefacts will be used to reward and incentivise people as they travel with discounted tokens offered based on being physically present in certain places.
There are also plans to create “Da Vinci Code-esque quests” with clues left in the real world for people to discover. “That's the fun part,” said Ibañez, “but that stuff’s tough.
“Do I think that's going to be game changing or a big business line? No, but I think it's fun. I would use it.
“I know it's a bit of a cliche nowadays, but when I travel I like to find out what the locals are doing?
“I’d love for a local kid, someone who knows Sri Lanka the best and where to get the best spices, to create a quest for people to go there.
“And then he gets a piece of every booking because in the blockchain you can tie that up in a smart contract. This isn’t on our roadmap yet, but it is part of my vision.”
Ibañez says LIFE has intentionally developed a user experience that is familiar to users who may be put off by concerns about the trustworthiness of emerging tech like blockchain.
“People’s concerns only hurts if you're relying on crypto and NFTs part as part of your marketing. Where we're at is that's our underlying technology and it's good,” he says.
“If you look at our booking flow it's just normal, but we run it on the blockchain. When you use a company, you don't ask are you using Amazon Web Services or Oracle.
“Booking.com’s phenomenal success comes down to UI [User Interface]. Does it work? How fast can I get to checkout?
“That's why we've kept our UI just like a normal bookings so a user doesn't even know they're using the blockchain.
“And then it comes down to having the right inventory for the right person at the right price.”
AI is primed for mass adoption like the internet was in 1996
Although there are fears about a dystopian future with AI bots like OpenAI’s ChatGPT taking over, Ibañez sees parallels with the dawning of the internet age ahead of mass adoption.
“No one’s that scared of AI because they all think it will revolutionise all the other sectors except their own. Everyone thinks it's going to change the world, but not their jobs.
“As for Web 3.0, it kind of feels like what the internet was like in 1996. There's some stuff we’ve got to deal with, like dial up back them, but we’re still getting benefit from it.
“We're closer to that end of the spectrum today as far as this technology goes. AI’s been around for a while, but Microsoft wanted this PR push and to take a stab at Google.”
LIFE expects the bulk of its revenues to be driven by primary bookings in the near term but the secondary market will take over as it matures and people become accustomed to it.
“Down the line I’d love to be the technology you book with in order to be interoperable and tradable. You to book from anywhere and you can still resell it with our technology.
“Right now, hotels and airlines don't have a revenue line item for secondary markets, so they don't care about it yet but the second they start caring we’ve already created it.”
Growth and disrupting the industry giants
LIFE aims to grow organically and having built its technology is eyeing a Series A investment round.
Ibañez says he expects the investor community to come onboard as understanding grow about the opportunities of blockchain and Web 3.0 business models.
“I believe that, but I haven't necessarily seen it yet. We've been very fortunate to have great investors. So we're great.
“We're also very fortunate in that we didn't have to dilly dally because everyone who is part of LIFE has domain experience so we didn't need to do much research and development.
“We’re trading profitable, but our costs are quite low. I want to fine tune things, get it right and once we do turn it up. We're still in testing mode as far as marketing is concerned.
“I look at it more like a flywheel. I'd rather reinvest profits for growth right now.”
The complexity of travel has helped keep the likes of Amazon at bay, but Ibañez does not expect travel’s incumbent giants to sit back and be disrupted if new models gain traction.
“Those companies are very smart. They're big for a reason and they're highly focussed on their current initiatives.
“But they have the luxury of having a lot of money so that if something like this works, they wait and see and then they can purchase it.
“To challenge them and remain independent you’ve got to have a great idea and it’s got to be marketed perfectly because they're phenomenal marketers.
“The two things are that we have going for us as we have a great product and a great idea and we're ahead of the game.”