Latest / The Founder's Journey with Fexingo: First-Time Entrepreneurs, Failures, and Lessons Learned / How a Rejected Airline Deal Built a 50M Travel Tech Company
Transcript
- Lucas: You know that moment when you pitch a giant company, and they say no — and it feels like the end of the road? Today's founder had that exact moment, except the no turned out to be the best thing that ever happened to her business. Luna: I'm already hooked. Who are we talking about? Lucas: Anna Chen. In 2017, she had a prototype for a Bluetooth-enabled luggage tag — essentially a little tracker you slip inside your suitcase. She thought the obvious customer was an airline. So she pitched Delta. Luna: And Delta said no. Lucas: They said no. But here's the thing — if today's story moves your thinking forward in some small way, the reason we can keep doing these deep dives ad-free is listener support. You can find us at buy me a coffee dot com slash fexingo. No pressure, just a quiet nod to the people who make this sustainable. Luna: Yeah, it really does keep the lights on. Back to Anna — Delta's rejection. What was their reasoning? Lucas: Delta told her that their mishandled bag rate was already below one percent, so they didn't see a business case for tracking devices. Essentially, they said 'our problem isn't big enough for your solution.' That's a brutal thing to hear when you've spent eighteen months on a prototype. Luna: Right — you've built something for a customer who says they don't need it. So what did she do? Did she just give up? Lucas: No. She and her co-founder, Mike Tran, took a weekend to vent, then they asked a different question: who else loses luggage? The answer was travelers themselves. So they pivoted to selling directly to consumers through Amazon and their own website. Luna: That seems obvious in hindsight, but at the time it was a huge bet. They had no D2C experience. Lucas: Exactly. They had to learn everything from scratch — packaging, ads, returns. But by the end of year one, they'd done about two million in revenue. That was enough to convince them they were onto something. Luna: So the airline rejection forced them to find the real customer. How did that play out over the next few years? Lucas: They kept iterating. The first tag had a one-month battery. By version three, they'd gotten it to six months. And they started selling through airport retail shops. That actually became their biggest channel — travelers seeing the product at a kiosk while waiting for their bags. Luna: There's a nice symmetry there — rejected by the airline, then selling inside the airport. Lucas: Right. By 2022, LostNoMore — that's their company name — hit fifty million in annual revenue. And last year they launched a corporate version for airlines, ironically. Delta actually came back and asked about it. Luna: Wait, Delta came back? That's incredible. So the rejection came full circle. Lucas: It did. But Anna says that if Delta had said yes in 2017, the company would have been built entirely around one customer's needs — and probably wouldn't have the product variety they have today. Luna: That's the hidden gift of rejection, I think — it forces you to build for a broader market. Lucas: Exactly. She told me that the biggest lesson was: 'A no from one giant doesn't mean no from everyone. Sometimes it just means you're pitching the wrong person.' Luna: That's a keeper. So what's the one concrete takeaway for a first-time entrepreneur listening right now? Lucas: I'd say this: when a big customer rejects you, don't immediately assume your product is broken. Instead, ask who else has the problem you're solving. Maybe the best customer isn't the most obvious one. Luna: And maybe that rejection saves you from becoming a one-client shop. Lucas: Exactly. Anna Chen built a fifty-million-dollar company because Delta said no. Sometimes the best 'yes' starts with a 'no.'