Founder Profile: The New Standard In Cruise Lines

I’m very active, and even while on vacation I will always find something that fits into my lifestyle like hiking, cycling, rowing or other watersports. In addition, my wife and I like to eat well. She is in the cruise industry, and as a result, I have now been on over 60 different ships. 

It’s difficult to  criticize the top cruise brands because they are all very successful within their own business models. However, many companies are now considering their ships as the destination, and in doing so controlling the cruise experience to the highest degree ever. As a result, many past cruise passengers are taking the ‘been there done that’ position and are in search of smaller and more intimate cruise offerings. 

I have been in the sports/fitness/spa industry for over 30 years, and know the market we are targeting very well. There are 40M people just in the US alone who are considered ‘conscious consumers’. (Add another 50M+ in Europe). This market is not currently well served by today’s cruise industry. 

Essentially what we are doing is combining two of today’s hottest vacation trends; cruising and wellness travel. 

I can only speak now to our founders group because many of our C-level team are currently working with top cruise lines. 

My partner and Co-Founder Fredy Dellis was the former CEO of The World at ResidenSea, the only cruise ship ever to offer residences at sea. Prior to that he was President of Hertz Car Rental in Europe and President of Burger King International. He’s the brains of the outfit!

Our Creative Director, Brian O’Neil, has used his talents to bring Blue World to life. Brian is an ad industry leader (former Mad Man) who has won too many CLEO and Cannes Lion awards to count. 

Our Wellness Director, Di Trieste has over 20 years in the spa industry, most of them with the top rated US spa Canyon Ranch. Di will tie our wellness, sports, nutrition, education and excursion programs all together to provide a comprehensive product. She will not be getting much rest!

On our advisory board, and very special to me, is my wife Joyce Landry. Joyce’s company, Landry & Kling is the largest cruise ship charterer in the US. Joyce and her partner were two of the first women inducted into the Cruise Industry’s Hall of Fame for using cruise ships for group and corporate charters, now a billion dollar segment of the industry. 

As mentioned, our C-Level team is equally talented. We have been approached by some of the top people in the industry who love our concept and want to be involved. Unfortunately we can’t name names at this point but will be making some very big announcements soon.

A year from now, we will be very, very busy. We will have a full team in our office in MIami, we will be open for reservations, and hopefully about 60% sold for our initial sailing season. We should also have, at minimum, 10 full-ship charters planned for our Mediterranian region, and possibly others for our winter season. 

Our itineraries will be designed with port agents and shore providers selected. 

We will will also have a team in place working hard on our refit. In one year we will be just a few months away from the ship’s delivery to our selected shipyard. Our purchasing department, along with our contractors, will be making sure that all necessary materials and equipment will be set for delivery as needed.  

Our marketing and sales department will be working hard to build awareness of our brand and to continue a steady stream of bookings. 

In one year’s time, I also expect that our residences will be sold out and we will have 50% of these deposits now in escrow. 

So, as mentioned above, we will be very, very, busy!!

The simple answer is this – on every sailing we will have all like-minded passengers, people who are already fit and healthy and  others who are looking to become more fit and healthy. You will not find this synergy on any other cruise ship. There is a very strong, almost tribal mentality amongst those who opt to live healthy lives. It becomes a common denominator that leads to a very friendly and supportive environment. This will set us apart from other cruise offerings. (Plus a secret goal of mine is to set a new industry record in terms of passenger repeat rate) 

Also, SIZE MATTERS …….the larger the ship, the larger the fitness and spa facilities. However these amenities are shared by thousands of passengers with very little specific programming either on-board or on-shore, as sports/wellness is not a primary concern. Plus, the sheer number of passengers prohibits quality personal services in this field. 

On smaller (typically 5-star) ships you will always find smaller fitness/spa facilities. Here again, sports/wellness is not a primary concern, and if it were, the ships facilities are now too small to provide any meaningful programming.

We stand alone in offering a ship that is specifically designed to provide a 5-star ‘casual’ sports & wellness experience at sea, and we will have the amenities, programs and staff both on-board and on-shore to ensure a great product.

While nothing is completely recession-proof, I do think we have two elements in our favor should an economic downturn occur:

1. Our (passenger) price point caters to folks who have some accumulated wealth. Most people who have money certainly feel the effects of a downturn but they still take their vacations which they rightly justify as well-earned. A Blue World sailing can also provide an element of stress-relief which becomes more and more necessary during harder times. 
2. I have experienced two recessions over my 30-plus years in the health/fitness industry. During each I have witnessed that in a downturn, people tend to internalize. What becomes most important is family and health. I believe that as compared to other cruise products and vacation options, we will be well positioned in the event of a downturn.

Also, as a result of using an existing ship vs. a newbuild, we have a per-berth cost of approximately ⅓ of our competitors. This offers us the flexibility to adjust our ticket price as needed to meet our revenue targets. 

We have space on our ship for approximately 40 one and two-bedroom residences. Our one- bedroom units will be a single-deck layout of 850 +/- square feet. These units will sell for $2,350,000. Our two-bedroom residences will be split-level; living space on one deck and bedrooms above with a total of 1,200 +/- square feet. 

These units will sell for $3,350,000. All units will feature large outdoor balconies, living and dining areas, butler’s pantry, beautiful bathrooms and walk-in closets. All units will also include an owners private storage area to secure personal belongings when not sailing with us. All units will come fully furnished and buyers will have a choice of two designers, Tomas Tillberg (traditional) and Juan Poggi Designs (Modern).

We are very happy to report that as of today, we have 273 interested buyers for just 40 residences. Of course, some are more serious than others, and we are now qualifying each interested party. From our initial contacts with the first 60 on our list, we believe that we have well over 20 very serious buyers. We expect to grow this potential buyer list to 400 within the next few months. Within two weeks we will start to get early deposits into escrow which will offer top priority to our first 270+ interested parties. 

After all expenses related to the sale of these units; marketing costs, legal, design, and sales commissions, when successful in selling all 40 units, we will net approximately $107M. However, all of these funds will remain in escrow until our refit is completed and the ship delivered. 

One very attractive feature of this business model is that we plan to repeat this hybrid-ship model (passengers/owners) on second and third vessels, as such,  it will become a trademark of our brand. The sale of these units when combined with traditional (bank) financing once we are in operation, will provide significant growth capital to add additional ships and increase our fleet. Having internal access to this growth capital provides a very attractive proposition to early stage investors. 

First, of course, we need to complete our Series A round. We have a highly experienced New York Maritime investment bank leading this effort, and hope to fund this round within the next six to eight weeks. During this time, we need to keep our fingers crossed that Wall Street remains steady with no surprises. 

We have three target vessels, all at different price points, and all with different advantages and disadvantages. We have recently hired an experienced engineering team to help us select the right vessel for our project. However, there is no guarantee that another buyer will not get to a certain ship before we do. And for this reason, it’s good that we have a few ship choices. 

Another challenge will be value-engineering. As do most companies, we will have a ‘need to have’ and ‘want to have’ list. It’s important that we remain flexible about the overall design of the ship to ensure that we stay within our budget. 

The final key challenge will be to put the right team in place right from the start. Experience will help us to minimize costly mistakes. 

Many of our excursions will be included into our ticket price. We are doing this intentionally so that we can provide for a more stress-free vacation experience. We don’t want to be that cruise line that nickle and dimes their passengers at every turn.  However, when there is a higher associated cost to provide an excursion (take golf for example) we will try to pass along the cost to our passengers with a minimal mark-up. What’s most important to us is the overall experience, and we prefer to build a lot of these costs into our up-front fees. 

Our passenger profile is 35-65 yrs., with average income of $70K+. If I had a crystal ball, I would say that 65% of our passengers will be from the US with 35% other (mostly Europe).  

As we are now in the design stages of our company, having a VIP club of 500 future clients gives us a built-in passenger advisory board. We have already started, and will continue, to survey our Founders Club Members asking about equipment and excursion choices, preferred itineraries, dining options, timing issues, and many other questions that will help us to design and deliver their perfect wellness vacation. 

Our hope is that after our Founders Club Members sail with us for a first time, they will become our brand ambassadors. In return, we will offer them travel discounts, cabin upgrades when available, discounts on on-board spending, priority booking and boarding privileges, and many other items. 

Yes, this Founders Club is very important to us, and anyone can join but must invest at minimum $500. Anyone interested will also need to invest soon and we are only accepting 500 members into this VIP founders Club. To date we have less than 300 spaces remaining.