Last December, Michael Arnold, founder of the Tynan Travel Co. in Dallas, was at the International Luxury Travel Market (ILTM) conference in France with Keith Waldon, the founder and director of Arnold's host agency, Departure Lounge.
Arnold had launched his agency in September 2018 but was just selling part-time; just before his trip to ILTM, he made the decision to move to full-time.
He said he asked Waldon, "'Keith, what are the biggest agents doing? What does it take? Is there a level?' Because I always need some sort of target, otherwise I'm just going blind at this."
Waldon ballparked a figure: The biggest individual agents were likely reaching $4 million to $5 million in annual sales.
Arnold adopted that as his goal, and despite a global pandemic that has severely curtailed travel, he's on track to eclipse $5 million in sales in 2020. In October alone, he racked up $1 million.
"I should've gone higher," Waldon laughed. "I should've said $10 [million]."
Five million dollars in sales would be notable in any year but is nothing short of astounding in 2020. An ASTA survey this summer found that 93% of travel agencies' income was down at least 75% compared with 2019, with 78% of respondents reporting a plunge of 90% or more.
Prior to starting his agency, Arnold worked in private equity, a role he held on to as he worked part-time while getting Tynan Travel off the ground.
His family had used various Virtuoso agencies for their personal travel over the years, Arnold said. So when he started researching his "passion project" -- starting a travel agency -- he came across an article in the Wall Street Journal describing Departure Lounge's innovative nature and noted it was affiliated with Virtuoso.
He connected with Waldon and was up and running 24 hours later, booking travel for ultrahigh net worth clients.
The day after he launched, he "booked the most expensive commercial aviation ticket available in the world, on Etihad," Arnold said.
Right from the start, Arnold rose up through the ranks of Departure Lounge's top producers, and he has stayed there. Waldon credited him, at least in part, for Departure Lounge being down only 37% this year.
The private side of the equation has gained during the past nine months. Early in the pandemic, Departure Lounge's advisors pivoted to focus on private homes. They studied what options were available and shared that information with the entire team.
Arnold is fascinated with aviation, and quickly established expertise in booking private flights. Before Covid-19, the average Tynan client would fly privately about half of the time, typically for domestic trips of around three hours in the air. They usually flew commercially for transcontinental flights.
The combination of private accommodations and private aviation resulted in a number of large bookings, Waldon said.
Arnold requires clients to adhere to a minimum annual spend level. While that amount depends on the client -- initially, the bar was set too high to attract younger clients coming into an ultrahigh net worth lifestyle, Arnold said -- all are at the Virtuoso Reserve level. (Virtuoso Reserve is for clients who rank in the top 3% of luxury travel spend.)
Arnold has two assistants who work with him, and he recently brought on an independent contractor.
His goal for 2022 is to hit $10 million in annual sales. His $1 million October bodes well for reaching that goal, he believes, using it to forecast that he and his team have the ability to potentially do even $12 million in annual sales.
That month was the best month any Departure Lounge advisor has had in the host's seven-year history, Waldon said.
Tynan has worked with a core group of clients since it opened and has maintained a wait list of potential clients, Arnold said. He has started bringing on some from the wait list but is doing so at a cautious pace to ensure service standards don't fall. He wants his business to be sustainable.
Waldon said Arnold's $5 million in sales would have been at least 40% higher if the pandemic hadn't happened.
Arnold said he is also in discussions with Waldon about increasing Tynan's partnership with Departure Lounge to open its network of the ultrahigh net worth segment to other independent contractors.
Waldon, too, has his eyes set on the future. He used some of the pandemic downtime to develop host agency operations in Europe, which launched this month. He is also putting together a new preferred program, an invitation-only group of hotels around the world.
Waldon feels the willingness of hotels to join the program and Arnold's decision to affiliate with Departure Lounge positions the host agency on solid ground when the pandemic ends. "We've been very fortunate," he said.