Luxury travel club Inspirato entered a definitive investment agreement with One Planet Group LLC for USD 10 million equity financing in exchange for ~USD 2.9 million Class A common stock and an equivalent number of warrants.

The f unds were earmarked to strengthen Inspirato’s liquidity and improve its capital structure. The agreement will proceed in two tranches: the first closing on August 13th for ~USD 4.6 million and the second in September for ~USD 5.4 million (pending shareholder approval). Following this, One Planet Group has the option to contribute an additional USD 2.5 million under the same conditions.

Other conditions for the deal included 1) Payam Zamani’s appointment as CEO and Chairman of the company, 2) a 15% workforce reduction, and 3) the termination of certain impaired leases. Inspirato expects the cost-cutting measures to reduce annual costs by ~USD 25 million.

Analyst QuickTake: The restructuring follows Inspirato’s 2023 revenue falling by 18% YoY to USD 329 million, contributing to its net losses rising to USD 93.9 million from USD 51.1 million in 2022. Additionally, the company raised USD 25 million in August 2023 , with funds earmarked to provide operational flexibility for enhancing its luxury travel experience for its members.