SKY Leasing and JetBlue announced today that SKY has acquired JetBlue Ventures, JetBlue’s venture capital subsidiary. (Was I the only one that didn’t know JetBlue had a venture capital subsidiary?)
JetBlue Sells Venture Capital Subsidiary
According to the press release, the transaction will usher in the next era of growth for JetBlue Ventures, with expanded opportunities to support founders and scale game-changing technologies by leveraging SKY’s deep industry relationships, global reach, and access to capital. JetBlue is expected to continue to serve as a strategic partner to JetBlue ventures and its portfolio companies.
Since it was founded back in 2016, JetBlue Ventures has invested in 55 early-stage startups and made over 40 follow-on investments. This has resulted in eight exits via acquisitions and public offerings.
Matthew Crawford, Co-Chief Investment Officer at SKY Leasing, had this to say about the purchase:
“We are thrilled to welcome JetBlue Ventures into the SKY family. Through our aviation partnerships around the world, we are witnessing firsthand the rapid advancements and innovations in the travel industry, and as a long-term partner to JetBlue, we have consistently admired JetBlue Ventures’ track record of nurturing these groundbreaking technologies. This transaction is a natural evolution of our partnership and will provide us, our investors, and our global aviation partners with direct access to the cutting-edge innovations and technologies shaping the future of travel.”
Joanna Geraghty, JetBlue’s Chief Executive Officer, added this regarding the sale:
“We founded JetBlue Ventures to invest in, incubate, and partner with early-stage startups that would shape the future of travel, and by all measures it’s been an incredible success. As we look at the needs of our airline today, we are fully focused on our JetForward strategy to get JetBlue back to profitability and set us up for long-term success as we compete against the legacy carriers. This transaction enables us to focus on our core airline operations, while maintaining our access to the innovations and opportunities of current and future portfolio companies through our ongoing strategic partnership with JetBlue Ventures.”
This Sale Makes Sense for JetBlue
When I first saw this announcement, my initial thought was one of surprise that JetBlue even had a venture capital subsidiary. While it appears to have been doing well, JetBlue is struggling to return to profitability and a laser-focus on the airline operation needs to be where the organization is spending its time.
The airline appears to be trending in the right direction, going so far as to develop a partnership with United Airlines. Details of that partnership have not yet been finalize but some expect that it may ultimately lead to a merger, as JetBlue holds highly coveted spots at John F. Kennedy International Airport (JFK) and United wants back in.
While JetBlue Ventures has been sold to SKY Leasing, JetBlue will continue to hold positions in all existing portfolio companies. JetBlue Ventures will manage all current and future investments and the JetBlue Ventures name will be retained as part of a brand licensing agreement with the carrier. The terms of the transaction were not disclosed but this likely provides JetBlue with a much-needed influx of cash as part of the sale.
Summary
JetBlue has sold its venture capital arm to SKY Leasing as it looks to focus on returning its core business to profitability. JetBlue will continue to hold positions in all existing portfolio companies but the day to day management and future investments will be handled by SKY Leasing. Terms of the sale were not disclosed.