Coffee, Tea or Affordable Travel?
There’s a one year old tech start-up that wants to get you traveling. It’s called Airfordable, and it lets users pay for airline tickets through installments. But first you need to take a screenshot of your itinerary and upload it to the site. Then the company sends you a payment plan. If you want to make it yours, you need to shell out a third of the price for the initial deposit. But once your ticket is paid off, Airfordable will present you with an e-ticket and you’re well on your way. Co-founder and CEO Ama Marfa came upon the idea whilst in college and unable to afford the $2,000 airfare to fly home and see her family in Ghana. And she wasn’t the only one as several students, both domestic and international encountered similar challenges. So how does Airfordable make a buck? By simply adding a service fee of between 10% – 20% spread evenly across the payments. If a user defaults or needs to change plans, all the money that was paid, minus the initial deposit, gets put back into their Airfordable account, where users have up to a year to use the money towards a different flight. As with any ambitious start-up, the company plans to branch out into vacation packages and hotels. Airfordable already has 27,000 users and scored a seed round of funding from Y Combinator. Not bad for a company that came into existence after America’s abysmal choices in the presidential primaries.
What are you going to do with all that free time?
The drama continues at embattled Wells Fargo but at least John Stumpf has finally threw in the executive retirement towel yesterday. At first denying and then blaming 5,300 terminated low-level employees, Stumpf managed to incur the wrath of investors, lawmakers and consumers. Oh my! His abysmal handling of the scandal that involved the opening of countless fraudulent accounts gained extra special attention from Senator Elizabeth Warren. And if for some inexplicable reason you feel sympathy for Mr. Stumpf, then don’t. He’s walking away with over $133 million – and that’s after a $41 million clawback in unvested options courtesy of Congress. That $130 million figure is not a typo. In case you’re wondering how on earth he will be walking away with more money than those 5,300 terminated employees probably made in the last ten years combined, he’s entitled to 2.4 million shares, $4.4 million from deferred compensation plus another $20 million from his pension account. But take heart that he received no severance. Isn’t that reassuring? But that’s not his only source of income. For now anyways. While Stumpf has been CEO at Wells Fargo since 2007, he also still sits on the boards of Target and Chevron and collects…wait for it…about $650,000 frrm those positions. Both Target and Chevron have yet to take an official position on whether Mr. Stumpf will continue his roles at those organizations. But judging by how events have been unfolding, he might just end up with a lot more free than he anticipated.
Delta Airlines took a profit hit for the third quarter. The airline lost $150 million from its massive tech outage that saw the cancellation of 2,300 flights over the course of three days back in August. Even though analysts expected that, Delta still earned $1.3 billion, a 4% drop over last year at this time, but still adding up to $1.70 added per share. The company took in $10.5 billion in revenue, which is not as impressive as one might think considering that it was a 5.6% decrease and a $724 million drop from the same time last year. And yes, about $100 million of that was from the outage. In any case, analysts wanted to see revenues of $10.55 billion. So no matter how you crunch those numbers, they disappoint. Part of the problem was that the airline had too many seats – a fact that was not lost on the number crunchers. Delta will scale back its seat offerings next year in an effort to boost prices. Something to look forward to. Because fuel prices are still a relative bargain, Delta got away with spending just $1.4 billion, 22% less than it did during the same time last year. But experts don’t expect that to happen again. Shares for the airline are down 23% for the year, which only adds to the weirdness surrounding the sudden departure of executive chairman Richard Anderson just two days ago.