LONDON – Northern Pacific Airways has announced its Crowdfunding campaign via Wefunder. Anyone is able to invest in Northern Pacific.
You do not have to be an accredited investor.
The airline is seeking to invest $5m. At the time of writing, it has secured over $1.6m.
The news follows Northern Pacific’s operational update. The airline has been cleared by the US Department of Transportation to operate eight aircraft. However, the airline currently only has four 757-200s, which are being re-certified.
Interview with Rob McKinney
AviationSource had the opportunity to sit down with Rob McKinney, Northern Pacific’s CEO last night to discuss the crowdfunding launch and get an update on how their development is going.
TS: The target for crowdfunding is $5m. Where does the airline aim to use this money?
RM: It’s all part of the, startup that we’re working towards, for the launch of Northern Pacific Airways, particularly through the Boeing 757 operation connecting Asia and the continental US through Anchorage.
TS: At the time of the interview, you have raised over $1.6m up to now? What is the confidence level of achieving the full $5m?
RM: We are. So I haven’t checked it yet today. The 1.6 was yesterday and, that was with two emails, and the webinar that Josh and I held. So, yeah, there seems to be lots of interest and, you know, we’re very, very pleased with the response.
TS: What is the mantra behind crowdfunding instead of seeking investment privately? Is NP going for more of a people-based approach when it comes to such investment?
RM: We’re pursuing the private investment track as well, but for all of us here at Ravn and Northern Pacific Airways, it’s important to us that our success is an Alaskan success.
So over the past two weeks, that’s really been, our goal is to get the word out and make this opportunity is available not just for the accredited investors, not for the wealthiest among us, but for everyday people who want to join in and, and own part of their hometown airline.
TS: How do high fuel prices increase Northern Pacific’s cost advantage?
RM: Everyone in the marketplace is facing the same challenge. So that same cost input is the same for us as it is for Delta or the JAL or anybody else. The other thing that we have going for us is because we are doing just like the big freight companies do by stopping here at Anchorage.
We’re not carrying enough fuel to cross all the way across the Pacific. So when you do that, you have to burn fuel to carry that fuel. And, by splitting up the trip, we actually will have a little bit of an advantage in the few areas we intend to serve.
TS: NP is also wanting to push the “Meet in the Middle” concept, similar to what Icelandair and others do at present. The thrust behind this is around encouraging business people to hold their meetings in Alaska. What level of forecasting does NP have regarding this segment of the market?
RM: We do have the numbers and it certainly seems like they’re there. You know, we have the models of Copa and Icelandair that have been very successful with that kind of model. And until we actually open up and start selling tickets, then that will be the test to see how much traction we get with that model.
TS: The airline’s fleet plan for the next four years ahead is pretty aggressive. Does the airline believe such a level of aggression is needed to tap into the Transpacific market?
RM: Well, I mean, who knows? You have to set a target. You have to have a plan and go down that path. And there are all kinds of things that might be bumps in the roads or, or things that make us have to pivot, but that’s one thing that we’re really good at is that when we see that we need to go a different direction, we do.
So that’s the plan as it is right now, that’s, it is an aggressive plan, but we think that gets us to scale. That gets us to a point where, you know, we could look at some kind of possible extra strategies, but that’s the plan as we have it right now.
TS: There is also some emphasis behind Northern Pacific & Ravn being a power couple. Can you go into more detail about what connectivity will be like between the two airlines?
RM: Well, it’s, it’s the same company. It’s the same airline, it’s the same reservation system. It’s just two different brands for the two different things that we’re doing. So, they are completely intertwined entities.
TS: Are local companies working with you to enable customers to book experiences in Alaska?
RM: Absolutely. We’re getting more and more partners that both wanna work with us as far as the activities and experiences, but also to partner with us on our loyalty product, where people can earn points at local hotels, restaurants, and activities, and then be able to also redeem their points, here in Alaska.
TS: When you announced your loyalty product in January, you said it was cryptocurrency-based. With the recent crash in cryptocurrency, does that really affect anything or is it still continuing as planned?
RM: It really doesn’t as ours was never meant to be a security and we’ve gone to great links to make sure that, we stay well inside the four corners of what the SEC expects for the product to be a utility token. And the utility’s always gonna be there to be able to use it for flights, to be able to use it for, goods and services that are still there. So, that really hasn’t changed anything.
The beauty of why to do cryptocurrency is that it’s permanent and it belongs now to the customer. And so instead of, a loyalty point being, a liability on the books, this now can turn into an asset for us and for anybody else who uses it.
TS: The carrier is projecting revenues of $1.3bn by 2026. Expand on how the airline aims to get there, and what routes could provide the most lucrative revenue sources.
RM: That’s definitely just based on the airline model and the load factors that we’re projecting with the amount of capacity that we’re gonna have. That doesn’t include any profits on any ancillary sales at all.
TS: Why should people invest in Northern Pacific?
RM: We, are going off a proven business model that works great at other places in the world that we have. It’s a great opportunity. We already have this infrastructure set up here in Alaska. So we’re perfectly positioned to make this. The amount of traffic is there. Finally, the hurdle for success in a startup airline could never be higher with our business model.
TS: Is there anything else you’d like to add for our readers?
RM: I’m just super appreciative of the great response that we’ve had. We’re deeply grateful for everyone that has shown the faith that they have in us to invest their hard-earned money. And, we’re gonna do them proud.
TS: Rob, thank you for taking the time to speak with us.
Overall…
What remains clear is that McKinney is very hopeful and optimistic ahead of the airline’s launch day plans.
Looking ahead, it’s going to be interesting to see how much of a lucrative market this will be for Northern Pacific Airways as well as the sort of figures surrounding passenger numbers and load factors will be.
But, for now, it remains clear that Northern Pacific is a carrier to look out for, as the potential for success is huge.
