Recently, there has been a spate of investments in Indian companies that provide online travel services. This is probably one of the earliest forays by VC's into an an entire Internet sector in India.

Kleiner Perkins in Cleartrip
WestBrige in Travel Guru
Reliance, Norwest and TV18 in Yaatra Online
SAIF in MakeMyTrip

These investments make perfect sense. India's burgeoning middle class is keen to spend on travel. Moreover, tourists worldwide are also keen on spending their annual vacations at Indian locales. Both these groups are keen to study varied aspects of India' cultural heritage - Temples, Minars, the Taj Mahal, forts, rivers etc; as well as experience its economic might - thriving software industries, bustling cities with a splurging middle-class, pubs, mouth-watering delicacies and so on.

Often, planning a trip involves dealing with various intermediaries and agents, and that too over a non-electronic medium. A good online travel service will remove many of the frustrations inherent in planning trips to India. It will also leverage aspects of electronic communication --timeliness, transparency and better organization.

I will not be surprised if a good percentage of these firms go public by 2010. But competition in this sector is fierce and relentless; players will have to innovate continuously to survive.

May the journey begin!

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