Charlie Birkett, Co-Founder and CEO of Y.CO gives his thoughts on summer season 2019 and the future of chartering
CEO and Co-founder Charlie Birkett (left) and Chairman and Co-founder Gary Wright
We met with Charlie Birkett at the Y.CO offices in Monaco to discuss the current status of the superyacht industry and what the future may bring.
Why Monaco?
We established Y.CO in Monaco and started here. For us this is home. When we chose Monaco over say London, we chose it because it was close to the Mediterranean. It’s close to the yachts.
We manage over one hundred yachts out of this office, so having the team able to access those yachts along the coast from Genoa to St Tropez or further down to Toulon and Marseille is logistically very easy.
Is it prestigious? Yes, we consider Monaco to be one of the world’s leading yachting hubs. There are other big marinas around the Mediterranean that are also considered to be great bases like Barcelona and Antibes, but Monaco is a good central spot. This is home for us.
You have an extremely strong brand with the use of the yellow and how your website works. Do you actively try to separate yourself from competitors?
Let me give an example from the world of business – we are more of an Apple/Google than a conventional investment bank. A lot of our competitors are quite traditional in their thinking, we are certainly thought of as a disruptive brand. We are doing things differently but also doing things better.
The complications of this industry and the regulatory issues with which we have to comply and abide by have become increasingly stringent in recent years. There are over one hundred people in the team; we’re managing vessels of up 130/140-metres-long with operational budgets of over 20 million euros at that level. On the surface the company may look yellow, cool and fun but behind the scenes it’s a serious business
Does fractional ownership work? How do you see the future market changing?
Historically, sharing yachts has never worked that well. Of course, there are operations and vessels that have an ownership structure where they do have more than one owner. I would say, though, that more often or not it’s a family or very close friends – its very rarely that you have this fractional ownership otherwise. It’s been tried and kind of failed.
In the next five years we are certainly expecting to see 60/70-metre, 36-passenger, 18-cabin superyachts that are able to let their cabins out on a per-night/per-cabin basis. That’s something we definitely have our eye on. There’s an interesting gap between a superyacht and a cruise ship. That market has not yet been developed
Do owners need to think “outside the box” to make money?
It’s very difficult to make money from a superyacht using the typical seasons from December to April in the Caribbean, and July and August in the Mediterranean.
You need to look at typical cruise-line operators which aim at ensuring there are bookings all the time whether that be reduced discounted rates or whatever. But they know they must have maximum occupancy – that’s how you make it a proper commercial operation.
What is your perception of the current market?
The market is changing almost every quarter, we are seeing a big shift. We currently have four or five really exciting projects on the drawing board. 65m-plus yachts that are being designed by young, forward-thinking, entrepreneurial people, yachts which I think will remould the way we look at yachting. Built for purpose rather than look or style. ‘Functionality’ is the big buzz word.
Charter-wise we have most recently launched ‘LYNK’ which is an innovative online platform that allows us to curate and share tailored yacht collections and itineraries with our Charter Clients, demystifying the Charter booking experience
Is the explorer market a genuine, sustainable growth area?
Yes, very much so.
We have just purchased LEGEND on behalf of one of our clients, which is a very busy explorer yacht out to charter in Antarctica, in the Northwest Passage, around Greenland. It is available as a single-use charter or you can also book ‘per cabin’ charters. We will be running and operating that for the new owner, but it’s just one of many operations we are running.
We are running yachts that are off the beaten track, that are doing their own type of exploring in places such as the South Pacific. Very dynamic operations sometimes specifically used by their owner to do things such as advance water sports or research. That’s something we are very tuned into and, as a company, we are probably one of the leaders in that market as nobody else has really tapped into doing it.
So there is an appetite for explorer yachts?
There is a very big appetite for it. This is where we see the ‘new generation’ of superyacht owner or yacht charterer.
Perhaps they have done the Mediterranean two or three times and enjoy it but are now looking to do something a little more extreme — whether that’s heliskiing off a yacht or cruising around Alaska or Norway. There are many adventures that aren’t just in the Mediterranean or Caribbean, and I think this next generation of charterers is very focused on that.
I think the market has expanded and there are more yachts available in different locations around the world, so I think that’s opened up something different. And that’s opened owners’ eyes to what they can do and where they can go.
Ten or fifteen years ago the yachts were just in the Caribbean and Mediterranean, whereas now there are yachts in locations like the South Pacific and Asia. The standards of the crews are very, very high – so people know they can get the same level of service on a yacht that is in an alternative location.
Final thoughts for the summer season ahead?
We are seeing an increase which is always good as a business. We are looking at a busy July and August. In terms of boat-show season we have lots of good, interesting sales that are pending, but we are also listing some interesting yachts for the charter in Barcelona and Monaco.
Generally I would say the landscape looks optimistic. Cautiously optimistic.
