Startup Avelo Airlines announces new funding round as it plans to double in size
Less than a year after commencing operations, Avelo Airlines announced a new funding round on Thursday and is looking to the future.
The Houston-headquartered ultra-low-cost carrier raised $42 million in Series B funding, led by Morgan Stanley's North Haven Tactical Value Fund. With its $30 million investment in the Series B round, which follows its participation in Avelo's January 2020 Series A round in which the group invested about $125 million. With the latest investment, North Haven Tactical Value Fund is now the airline's largest shareholder.
"The incremental capital we've raised is a significant vote of confidence in Avelo's initial momentum and the enormous opportunity ahead of us," Avelo CEO Andrew Levy said in a statement. "This additional capital significantly bolsters our already strong balance sheet and enables the acceleration of Avelo's growth trajectory in 2022 and beyond."
Avelo now has a capital base of over $160 million.
The airline also announced on Thursday that plans to add nine more aircraft to its existing fleet of six 737-700s and 737-800s by the end of the year. It also plans to double its network, from 19 destinations to at least 40, and expects to hire 450 more crew members.
Avelo launched in April 2021 with a base at the Hollywood Burbank Airport (BUR) in Southern California. In November, the startup added Connecticut's Tweed-New Haven Airport (HVN) as its second base. Since its launch, Avelo has flown more than 345,000 passengers on over 3,000 flights. Only seven flights have had to be canceled since the launch date, the airline said, and most of those cancelations have been due to weather.
More: 'It's surreal': What it was like on Avelo Airlines' inaugural East Coast flight
Avelo was one of three U.S. airlines to launch in 2021, along with Breeze and Aha!, which is operated by former United Express carrier ExpressJet.
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