How Loveholidays tripled revenue without owning a single plane

"It's your baby," says Donat Rétif, chief executive of Loveholidays, on what it's like for a founder to hand over control. "You have put all your heart and soul into your business. So it's very important, I think, that when you give your baby away, you give it to somebody that you really trust."

He took over from one of the company's two co-founders in December 2019, three months before the pandemic shut down travel altogether. It's a turbulent time to run an online travel agent, with turmoil in the Middle East and volatile oil prices testing demand all over again. But Loveholidays has kept growing regardless.

Speaking to Sir Richard Harpin on the Business Leader podcast, Rétif explained how the business has tripled to over £350 million in revenue since he joined, expanded into eight countries and become the fastest-growing online travel agency for package holidays in the UK, with an IPO rumoured to value it at up to a billion pounds.

In our interview, Rétif shares:

• Why Loveholidays deliberately entered Germany first
• How he agreed a one-page written contract with the founder before taking the job
• How AI chatbots now handle 60 per cent of customer queries, with higher satisfaction scores than humans
• His "rule of three" for keeping a fast-growing business from losing focus

Taking over from a founder, in writing

Rétif's route to Loveholidays came via a headhunter and, by his own account, some persuading. A telecoms and private equity veteran with nine exits behind him, he wasn't instinctively drawn to a small, UK-only, consumer travel business until he met the founder. "We really connected," he says. "As a founder, you have been one so you know, it's your baby."

What he insisted on early was clarity, writing a one-page agreement setting out how he and the founder would work together before it went to the board.

"You can't leave it blurry, because if it's blurry, your employees are going to be confused," he says. The founder still sits on the board and meets Rétif six times a year, but is otherwise "completely remote from the business now".

Why Germany came first

Loveholidays operates as a marketplace rather than an airline or hotel owner. "We're completely asset light," Rétif says, sidestepping a rule limiting some rivals: airlines operating in Europe need over half their shareholding to be European-based. Staff numbers have grown from roughly 100 to more than 400, all in Hammersmith, with 900 more in India and South Africa in the call centre.

Rather than an easy market, the business launched internationally in Germany, one of the toughest for digital bookings, where only around 20 per cent of holidaymakers booked online against more than 80 per cent in the UK. "We wanted to prove that if we can do it in Germany, the rest will be easier," Rétif says.

The team assumed younger German customers would pay by card, and found they wouldn't. As a result, for the Netherlands and Scandinavia, the business brought in payment specialists ahead of launch.

Sir Richard Harpin with Donat Rétif

Technology reaches well beyond the booking engine. When refund requests spiked 30-fold during Covid, the company built a chatbot rather than scaling up a call centre it couldn't staff fast enough, a system since evolved into generative AI. Today, 60 per cent of customer chats are handled entirely by the machine, "with a customer satisfaction which is higher than when it's handled by people," Rétif says.

Keep a North Star, don't cut costs on reflex

Rétif has led businesses through three crises, including 2008. His central lesson from Covid was resisting the instinct to slash spending. "We doubled down on our technology," he says, "while most travel companies will have to cut costs, let's take lots of market share." That bet is a large part of why the business has tripled since. His other rule is refusing to favour one stakeholder over the others: "You need to answer to your shareholders, your customers, and your employees, all three of them."

Loveholidays didn't have anyone responsible for people when Rétif joined, so hiring a chief HR officer was one of his first moves. Net Promoter Score has risen from the low 30s to the 60s since, a level he says only Jet2 matches, with staff turnover in single digits despite constant poaching from Google and Meta.

To keep focus as the business grows, he applies a "rule of three": three objectives, three product lines, three customer segments. "If it becomes four or five, I start forgetting," he says.

What's next?

Loveholidays is targeting 20 to 30 countries by 2028 to 2029, expanding into long-haul and city breaks, and building partnerships with retailers, airlines and banks, including a hard-won deal with Ryanair. An IPO on the London Stock Exchange remains the goal, delayed rather than abandoned by recent geopolitical disruption.

"A window will open. And whenever it opens again, we'll be ready," Rétif says.

At 55, and nearly seven years into the role, he's already thinking about succession. "I think I'm better at scaling businesses," he says. "Once they get to this phase of less growth, it's going to be time for me to give the baton to somebody else who'd be better suited."

Donat Rétif spoke to Sir Richard Harpin on the Business Leader podcast. Listen to the full episode for more.