My guest on this episode is Glenn Gonzales. Glenn is the founder and CEO of Jet It, a fractional share private jet business with a unique model serving customers across the country and in Europe. Prior to founding Jet It, Glenn was an F-15 pilot in the Air Force and sold private jets on behalf of Gulfstream and Honda.
This episode is a deep dive into all options available for business owners who want to fly private. If you want to explore private travel options, fly private more frequently, or even buy an aircraft directly to make your business and personal travel more efficient, this episode is for you. We talk about high level benefits to flying private and what factors to consider when evaluating your options. We walk through each of the four core private travel models – charter, jet cards, fractional ownership, direct ownership – along with their pros and cons and what kind of person or business each is meant for.
After diving into each model, we talk about how Glenn’s company Jet It fits into the private travel ecosystem and where that ecosystem is headed in the future. Finally, I ask him what it is like flying an F-15. I hope you enjoy this episode and find it useful for deciding how you and your business can utilize private travel in the near future.
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(5:04) – Glenn’s background in aviation and military career
(6:41) – Do you have any favorite memories from your days in aviation sales?
(8:27) – What are the different breakdowns of customers who would buy a place directly?
(10:22) – Where does someone get started in exploring private aviation?
(12:54) – What are the broad pros and cons of flying private?
(18:25) – Glenn’s rule of them for business owners considering flying private
(20:29) – Private aviation models: Chartering & Jet Cards
(24:26) – The state of Jet Cards as an industry
(25:41) – Costs within Chartering and Jet Card
(27:07) – Private aviation models: Factional Ownership
(29:32) – Pricing within Factional Ownership
(33:48) – Yearly income needed before considering direct ownership of a plane
(35:12) – How does JetIt fit into the ecosystem of private aviation?
(39:05) – Does JetIt help arrange transportation after landing?
(40:31) – Have you faced any near-death experiences in building your business?
(42:17) – How do you hire and recruit folks?
(43:46) – What do you think the private aviation landscape will look like in 10 years?
(46:03) – How can private aviation become more affordable?
(48:05) – How much does an electric plane drop the cost of a flight?
(51:01) – What college class would you teach if it could be anything?
(51:37) – What strongly held belief have you changed your mind on?
(53:32) – What’s the best business you’ve ever seen?
(54:10) – Who are some aviation entrepreneurs that you admire?
(58:26) – What are some differences between flying a Honda Jet and the F-15?
Alex Bridgeman: Thanks, Glenn, for coming on the podcast. This is an episode I’ve really excited about because I’m an aviation geek, and before recording, I was telling you about the planes I have on my shelf. So, this is the perfect blend of aviation and then business as flying private as a business owner. So, I’m really excited to chat through that. I figured a good outline would be hearing all about your background, flying F-15s, working for Gulfstream and Honda before Jet It, and then describing a little bit kind of like high level pros and cons of flying private, diving into each of the options of flying private, and then how Jet It fits into all of that. But let’s start with your background. It sounds like you have the quite the exciting background that I’ve love learning about.
Glenn Gonzales: Yeah. Thank you for having me on Think Like An Owner, Alex. I’m really excited to share with you all. And I’ve been really fortunate and extremely blessed to have had an amazing career in aviation. Like you mentioned, I flew fighters in the Air Force, but actually, although the airplane was amazing and incredibly uplifting and fulfilling, it really wasn’t my favorite job in the Air Force. My favorite job in the Air Force was flying as an instructor pilot and taking those students that were going on to fly fighters and bombers and just molding them from brand new pilots into steely eyed soon to be fighter pilot or bomber pilot. That was cool. And it was so rewarding because you’re coaching and teaching them how to become great aviators, not just pilots. After the Air Force, I did go to Gulfstream. I loved every bit of that. I mean, I was traveling the world, visited every continent, visited some of the most austere airports in the world, in the Marshall Islands, [inaudible [RD1] 6:10], Palau, visited all of the major cities around the world. It was incredible, but my passion was the dynamic nature of people and sales. I miss that dynamic energy from flying fighters and found myself at Honda Aircraft Company where I was both flying and selling, which I was extremely happy with that. But as the world turns, you climb one mountain, you look out on the horizon, you see another great mountain to climb. And that next mountain for me was Jet It.
Alex Bridgeman: That’s fantastic. I would love to hear, do you have any favorite memories or stories of customers that you sold a Gulfstream or a Honda jet to where you went to maybe the middle of nowhere or some huge office or house or something like that? What are some of the memories that stick out to you?
Glenn Gonzales: You never forget your first sale, and I’ll never forget I was on the road on my very first trip at Honda, and I’m sitting down with a customer and had been listening to him talk for about an hour and a half to two hours. And he says, “Well, who do I make the check out to?” I’m like, well, gosh, one, I didn’t expect that. This is my first time out and about selling. I spent a couple of days with my VP of sales at the time. And then he went back home and I’m meeting with this guy who was in the database, and he says, “Well, who do I make the check out to?” And I’m kind of like, “Well, you can’t make out a check. I can’t accept a check from you. You’re going to have to wire the funds.” And that was the wrong answer. So, I got back, I went back to Honda. I was like, “Guys, this guy wanted to write me a check. What kind of guy does that?” They were like, “What do you mean you didn’t take the check?” So I went back, I was with him the next week. I did accept his check. I did eventually deliver the airplane to him. So that was one of those unique experiences that I’ll never forget. Not quite exotic, but hilarious to me.
Alex Bridgeman: Yeah, that’s funny. That seems like the most stressful flight back home with the check in your briefcase, making sure it doesn’t get dirty or anything, that nothing happens to it.
Glenn Gonzales: Yeah, it was an uncomfortable experience, but I’m glad it worked out. He and I are still great friends today. He’s a phenomenal mentor. He’s been great counsel for the business as well.
Alex Bridgeman: That’s fantastic. One more question before diving into kind of the high level of flying private, what are kind of the different breakdowns of customers that would buy a plane directly through Gulfstream or Honda Jet?
Glenn Gonzales: There are several different marketplaces within aviation. There are the customers who just fly sporadically, kind of like your hotel. I just need it on an occasional basis, once or twice a year, maybe once a quarter, those are your charter users. But if you know that you’re going to frequent an area time and again, maybe you buy a second home or you buy a timeshare in that area. And that’s where companies like Jet It exist, where it’s fractional and you’re buying a piece of the airplane, it’s titled to you. There’re some amazing tax benefits associated with it. But if you need to visit the place all of the time, instead of renting in your hometown, you’re going to buy the home because you know you’re going to be there. So, you buy that home of residence because you’re going to be there 350 days out of the year. In aviation, if you’re going to use the airplane more than say 150 hours annually, then you probably should give some thought to buying the airplane. So, those are kind of the three markets – charter/membership, fractional, and then whole aircraft ownership. And the type of airplane that you’re buying into, the program that you’re buying into, is really mostly dependent on how you’re going to use the service. So, there’s the timing that I mentioned, but there’s also the type of aircraft. If I know I need to fly from south Florida to Seattle, I need a big airplane to cross the country, but if I’m only flying from Southern Cal to Las Vegas, and I’m doing that several times a week, it makes sense to buy into a Honda Jet or a program like Jet It.
Alex Bridgeman: Gotcha. That makes sense. And then diving into flying private, so let’s do like explain like I’m five. So, I’ve flown for 20 years in my career. I have a ton of air miles, perhaps. I’m the expert at getting through security and flying with minimal packaging and all this other stuff, done it my whole career. Never flown private before, I have no idea how to get started. Where does someone in that position get started in terms of exploring the idea of flying private?
Glenn Gonzales: There are all kinds of consultants and brokers and individuals that you could reach out to, but really you can educate yourself online. Flying private decisions. Go to gojetit.com. We’ll guide you and coach you through a consultation process to make sure that you make the right decision. But I think the first thing to do is to just have an internal evaluation: Where do I need to fly to, and where do I need to get consistently? How frequently am I going to do it, and who needs to go with me? The who needs to go with me and the locations are going to determine what type of airplane. If I need to take eight people with me, and I’m only going a short distance, maybe I don’t need the Gulfstream, maybe I only need a PC12. If I’m going a medium distance and crossing multiple states, it might benefit me to have a jet, especially if I’m only going two to three people. So, those are the kind of the first places to give some thought to, to evaluate where am I going and who’s going with me and how frequently am I doing it? That’ll help you determine the program and the type of aircraft. Once you have that information, then you can figure out, well, how often am I doing it? How many hours a year will I need this service? And that’ll help you determine. Now most people will say, if I’m doing less than 50 hours, then I should be in a charter or a membership program. But if I’m doing 50 to 150, 50 to 200 hours a year, in that particular case, I probably need to be in some kind of fractional program. And if I’m doing more than 200 hours a year, I definitely need to own my own airplane and have my own crew. Obviously, there are different price points associated with each of those, and that’s really where Jet It brings a ton of value. We can provide you with the cost similar to a charter or a jet card, but you get all of the benefits and the aircraft availability like whole aircraft ownership.
Alex Bridgeman: Gotcha. That makes sense. So then let’s go into broad pros and cons of flying private. So of course, there’s obvious pros. Like you can fly directly to the city you need to go to, there’s no security, that sort of thing, but there’s probably some other more subtle pros and even cons to flying private that I’d love to hear about. So, what’s the pros and cons of flying private, and what does that look like?
Glenn Gonzales: Yeah. I liken it to how we treat our cars versus, say, riding the bus to and from some place or public transport. I use my car because I can leave when I want at the time and hour with the number of people that I want. I have full and total autonomy to head to wherever I want to go when I want to go. In addition to that, though, I have the amazing efficiency of there are no stops. I just go directly to where I want to go. So, on a high level, the value of private aviation is autonomy and efficiency. But there are these little nuances like the previous administration did a great thing by introducing a hundred percent write off in Section 179 – I’m not a CPA, but I’m happy to speak to it – if you’re using the asset as a business tool, you can write off a hundred percent of that acquisition from your earnings. That requires some work with your accountant, that requires some work on our part to provide you with an analysis of what you’ve been doing on an annual basis. But man, what an amazing tool to inject capital into an industry. And so, it’s been a great thing for those who are aware of it in our industry. The other things that private aviation provides for you in today’s environment, look, it seems like COVID is wearing off, but then a new variant comes about. So, if I’m only flying with vaccinated crews, and I’m only flying with the people that I asked to be on the airplane, it’s a comfort level and a peace of mind that comes with being able to have the autonomy and efficiency that we all want and seek after.
Alex Bridgeman: Yeah, that part makes a lot of sense too. You can avoid getting ill by flying private on your own. That part makes a lot of sense.
Glenn Gonzales: At the end of the day, Alex, it’s about time. It’s about the time to do more business. It’s about the time to spend more time with our families. It’s about time to experience more in life. And on the very highest level, that’s what we do. And oftentimes, I think we miss that in the opulence and what seems to be extravagant, and you see the celebrities using private aviation, but 98% of our customers are not celebrities. They are business owners that want to get home to that dance recital, they want to get home to that soccer match, or they want to go spend more time with the supplier that needs the help so that they can further grow their business, so they can further support the employees that work in their company. And that’s how we approach it. Now, every decision that we make is focused on how do we better support our customers? How do we better support our employees? And in turn the business will grow.
Alex Bridgeman: Yeah, that was one amazing stat that I was reading within the Harvard case study that Jet It had done. There was that 2018 study that said that 57% of all businesses that use private aviation had less than 500 employees. Which was amazing to me because I figured private jets and private flying was mainly a public company type of activity versus what it sounds like is reality, which is a lot of small companies use private flying as well. That was pretty surprising to me.
Glenn Gonzales: Yeah, everyone always thinks that it’s just the major players that are going around the world to- the big three flying into DC to meet with the legislators. But the reality, like you said, it’s the small companies, less than 500 employees that are using these tools to expand their reach. Maybe you have a one-state radius, but in aviation, operating an airplane in the US, the airplane takes off and lands just the same in any other country around the world. So, to be able to expand your aviation business geographically or to expand your paper business or your sales organization, your consulting firm, to be able to reach more people. If you could expand it by a turboprop or a Jet It share or owning your own airplane and touch more states, there’s a return on that effort for your business. It’s no different from buying more vehicles if you’re in a trucking company. Having more vehicles, it creates an opportunity for you to bring in more business. Well, just the same, if you have an aircraft and you can get out there, yeah, there’s an expense to it, but if I know I can meet with more customers, I can deal with my suppliers and get more efficiency and get more product in hand to sell to my customers, man, the return is unmatched. We had one customer who’s in commercial real estate, I love to tell this story because he spent less than four hours of flight time, touched five cities in one day, and it was less than $8,000. In commercial real estate, an $8,000 travel expense is just, gosh, what’s your return if that’s all you spent in one day to touch five cities and view properties in each of those environments? It’s an amazing return on investment.
Alex Bridgeman: Yeah, no kidding. Especially with something like Wi-Fi on board where you can keep on email the whole time on the whole travel. So, I want to dive into the different options available for flying private, but just before doing that, there was a rule of thumb that we had talked about before recording where I was trying to think of how do I put each of these models into context for a business owner? So, if a business owner makes $2 million a year in net income versus 10, what are the different options available? There was an interesting rule of thumb that you had come up with based on your experience working with lots of different customer types that put this in better context. So, can you walk through kind of the rule of thumb for what makes sense in spending for private travel when you own a business?
Glenn Gonzales: When you own a company, if you’re thinking about your personal net worth, if you are somewhere around $2 million in take home pay, in most cases, people are going to spend 10% of their annual take home pay on their private travel. So, in this particular case, $2 million, $200,000 applied towards private travel. In the case of Jet It, that’s just under a hundred hours of flight time in a year, plus your monthly expenses, $200-250,000. And that’s easy when you think about the value and time that you have when you still have another 1.8 or so for your annual take home. Now it’s a little bit different when it comes to companies because companies have more expenses, they have more to be concerned with. So that percentage goes down as far as the percentage of net income in the case of a business. But the return on investment is higher. Those companies do have more expenses. They have more things to be concerned about with their employees. They have to manage their assets and get a return on those assets, but this aircraft then becomes an asset. And so that percentage becomes somewhere between 5 to 7% of your annual net income if you’re looking at spending $200 to $500,000 on an annualized basis.
Alex Bridgeman: Gotcha. That makes sense. That’s a good backdrop for breaking down the different models. So, let’s get into the models. There’re four rough models that each of these different options tend to fall into, which is chartering, so just calling someone up and chartering a plane from here to there, there’s jet cards, and there’s fractional ownership where now you’re starting to own the plane as an option, and then direct ownership where this plane is a hundred percent belonging to you and your company. Let’s start with charter and work our way up to full ownership. So within the charter model, what are rough pros and cons of that, flexibility costs, what does that model look like for someone, and who does that fit?
Glenn Gonzales: The charter model, and both charter and jet cards are one and the same, the jet card is just kind of a contractual charter arrangement. But your basic charter customer, it’s a spot market. What’s available? When is it available? Does it meet my needs? What does it cost? And the market will determine what that cost is. The customer has no control over it. You can negotiate it, but at the end of the day, whatever the market’s charging, you can either take it or you can leave it. In today’s environment where demand is so high, charter prices are just, they’re at an all-time high right now, which is very good for those operators. And not every operator is the same. So that’s something to be aware of if you are a charter customer. You want to check their safety rating, you want to check their crew ratings and their crew status and experience. Those are things that you can ask any broker or any company that’s offering their services to you. So, the advantage to the charter is, again, it’s kind of like this is I’m showing up in a town and I’m only going to be here one night, I need a place to lay my head, or in this case, I’m only going to travel to go meet with this person or I’m going on a quick flight with my family, or maybe I want to show off to some friends or I just have to be there and commercial’s not going to make it happen for me, I’ve got to get there to visit family, charter is the perfect solution for that when it’s just a spot market, I need a one-time expense to make this happen right now. When it comes to the jet cards, jet cards are about the same price point, maybe a little less expensive than the spot market. It’s almost like futures. I’m paying for a value today, so I can have access to this aircraft. And so, you’ll buy 50 hours, 25 hours, rarely do you see jet cards over a 50 hour dollar value. And there’s a cost per hour for that service. Still very expensive because there’s no long-term contractual arrangement. And oftentimes it helps companies in aviation float their business by accepting the cash up front and then providing the service later. That said, the people who need that, or I know I’m going to have some quarterly travel for my business, we’re going to do a road show here soon and need some private travel or some additional lift to support our needs, or maybe I just need to go to some austere environments and I need to get there and get back. And that’s where then those jet cards become a great value. What’s interesting is because the demand in the industry has been so high, a lot of companies have shut down the jet cards. They are limited by these contractual arrangements that they’re guaranteeing that they’re going to provide uplift and transportation for people, and with the market being so busy in an entirely new space, a lot of those commitments are hard to hang on to. So, they’ve stopped selling jet cards until a later date. So hard to find jet cards these days. And I think people are wising up to the fact that there’s was a company out west that ended up struggling financially and going out of business. And the customers that had jet cards with them were left holding the bag.
Alex Bridgeman: Yeah. Can we spend just another minute or two on the state of jet cards as an industry today? It sounds like that option might be becoming harder and harder to get ahold of. Is that the case? Or what are some other dynamics going on with jet cards today?
Glenn Gonzales: Yeah, I think it’s really just a contractual requirement on the part of the operator to provide lift. In the case of the fractional providers, a lot of the fractional providers, NetJets and Flexjet, in the past have provided jet card services. But the same goes for the other charter companies that are in the marketplace. And because they have so much demand from their fractional owners, they’ve stopped selling jet cards because they’ve got to make sure they support their primary customer. In our case at Jet It as a fractional, we don’t exist without our share owners. And so, operating safely is kind of inherent, but the second piece of that is making sure that we keep our customers happy and making sure the airplanes show up on time, service and support them to meet their needs. That’s all very critical to our success as an organization. We started out without any kind of jet cards and really don’t have any intention to move into a jet card environment.
Alex Bridgeman: And before we move on to the next model, I want to break down cost a little bit. So, within the charter jet card model, just to keep a standard kind of comparable flight for each of these, if you’re flying from New York Teterboro to Miami, what does that route cost for something like charter or jet card? What is the typical cost for that flight?
Glenn Gonzales: The cost and price point is going to be very similar for those two. In the case of the spot market, the charter customer, depending on the type of aircraft, and so a Honda jet type airplane, it’s going to be a three hour flight and it’s going to run you somewhere around $15 to 20,000. If you are then going up in size, it could run all the way up, if you’re in a Gulfstream, it could be $30 to 40,000. At the end of the day, it’s physics – the bigger the aircraft, the more it’s going to cost to fly that airplane, the more fuel that it’s going to burn, because it takes more energy to move more weight. So, if you’ve got more weight that you’re moving from north to south in this case, Teterboro to south Florida, or maybe you’re taking more people, it’s just going to cost you more. No different from if I take a hundred-pound box to FedEx or a letter to the post office, it’s more expensive to move it, and the faster I want it there, the more it’s going to cost.
Alex Bridgeman: Perfect, excellent. That’s a great segue into fractional ownership then. So, this is the model of Jet It and NetJets owned by Berkshire Hathaway, which funny story, Berkshire Hathaway’s office is three blocks from my apartment here. We can see it while washing dishes. It’s very motivational. What does that model of fractional ownership look like, pros and cons, who is that a fit for? And then afterwards, we’ll break down cost as well, but first starting with just pros and cons, then who’s that a fit for?
Glenn Gonzales: So, the pros and cons of the fractional model, it really is necessary if you’re going to fly consistently. I have a consistent need, in our case, I know that I want to do this trip once a month. Well, with 25 days available to me, I can do the around trip once a month. If I’ve got multiple legs that I’d like to do in the same day, I can, again, do that with our days-based model. And that’s just one day of utilization. Most companies are different from Jet It in that they use hours. Our thought process is the hours is a construct of aviation. The airplane costs X dollars an hour to operate, therefore I’m going to charge the customer an hour. We still have an hourly rate, but it’s your airplane for the day. That’s how you’d use it if you owned the whole airplane. So, we think the advantages there. The cons to a fractional program, more times than not, it’s acquisition, the cost to get into the program. You’re buying a piece of the airplane, which is a fraction of the total cost of the airplane, which more times than not, is not inexpensive. These are expensive aircraft. Our Honda jets start at $6 million and that’s the way that we auction them. So, they’re expensive aircraft. So, if you’re buying a tenth of the airplane, you’re in excess of $600,000 per. The benefit to that is, like I mentioned earlier, you’ve got great tax incentives to do so. It’s your asset for a period of time, whether it be five or ten years, and the advantage to that is, it’s like any other fixed costs, the more I can use it, the lower my overall costs to operating that aircraft is. So those are a number of the benefits. I don’t really know if there are any cons other than you have to buy into the program, especially the way that our program is set up with our low cost of entry, the aircraft availability, and our low hourly rate of only $1,800 an hour.
Alex Bridgeman: Gotcha. And so, I want to spend a moment on the different pricing. So, Jet It has a day model versus an hourly model. What’s the hourly model look like across several of Jet It’s competitors? And I just want to hear a little bit more about the pricing model. Like how does it actually work? And if I’m flying that same New York to south Florida route, what does that cost start to look like?
Glenn Gonzales: So, in most cases, Jet It is going to be four to five times less expensive than other programs. Our hourly rate is $1,800 an hour. Most companies are somewhere around $76-7700 an hour all in. That’s significant when you are flying as frequently as a lot of small and medium sized business owners need to travel. Going back to your comment, who’s flying and your question who’s flying and choosing to buy into the fractional programs, it’s those individuals, typically your small and medium sized businesses, that have a consistent travel need, whether it’s defined or undefined. If you’re a private equity firm just getting going, and you know you need to do a road show to support one of your new clients or to sell and take a company public, we’re a great fit for that because it’s a high concentration of utilization, and at $1,800 an hour, you know the return on your investment is going to be there. Just the same, those individuals who need to expand their radius or have customers spread throughout a region, those are the best people that utilize a service like Jet It. In the case that they’re paying $7,600 to $8,000 an hour plus fuel surcharge, plus, plus, plus, those companies, if you have a need for I might need a really small airplane, I might need a really big airplane, I might need something in the middle, those companies, that’s when you pay for that. You’re paying for those additional aircraft whether you’re using them or not. With Jet It, we do have access to a coast-to-coast airplane with our Gulfstream G150s. We’re excited to add those to our fleet and expand that. Our owners are super excited to use them. But those are the different people that are using the services and the differentiation between the companies.
Alex Bridgeman: Oh, and you mentioned the tax element to how now that you’re actually starting to own- you’re owning an asset now, you can now start to depreciate, like even with a fractional share, that was Section 179, can you still depreciate the full fractional ownership of a jet just as you would with a full direct ownership?
Glenn Gonzales: You most certainly can. And don’t quote me on the Section 179; I’m not a CPA, but I’m pretty sure that’s what it is. But yeah, you sure can. And that’s actually a great segue into whole aircraft ownership. If you are flying your airplane consistently for businesses, we would always say somewhere around $30 million a year in net income to support your Honda Jet sized aircraft at the $6 million value. For individuals, it was somewhere around $10 million a year to own a whole Honda jet. Those are the lowest entry points for a $6 million a year spend. The reason being, you’ve got two crew members that you paying, at least two crew members, maybe three that you’re paying for. And today’s highly competitive pilot market, you’re paying somewhere around $130,000 for a captain and $110,000 maybe or $90,000 for a copilot. That’s just for the crew. So, you’re already $200,000 a year in before you get into maintenance, fuel, upkeep of the airplane, hangar space. So, there’s some significant expenses to whole aircraft ownership. There’s also the effort to manage the airplane and to take care of any maintenance that goes with it. So, it’s an extensive effort. And what happens when that airplane is down? When it’s down for maintenance for whatever reason, you’re kind of out of luck, and you’re now going to a program like Jet It or NetJets or Flexjet or Wheels Up or whatever the case may be to fulfill that need that you’re missing out on that you needed all year long.
Alex Bridgeman: Gotcha. And you said it was for the individual 10 million in yearly income is about where whole ownership starts to make sense. Is that the number you had?
Glenn Gonzales: Well, and it’s dependent upon the type of airplane, but what we would always say at Honda Aircraft Company was I needed a customer to have about $10 million in personal net worth before they could afford a $5, $6 million Honda Jet.
Alex Bridgeman: You mean the net income per year, not net worth?
Glenn Gonzales: Excuse me, sorry. Yes, net income. And for a business, the bottom line or baseline was about 30. Those are rules of thumb. If I know that I’ve got the return on investment there, then yeah, you can easily do this at 15 or even at 10 as a business. But you definitely want to be smart about those decisions, smart about any swings in the economy or any changes in your marketplace before you make those kinds of calls because operating airplanes is not easy and it’s incredibly expensive.
Alex Bridgeman: Yeah, it is expensive. And to the point of when your plane is down, now as a business maybe you need to get two planes to make sure that you at least have one available at all times. And I don’t know if you’ve seen the Righteous Gemstones, but it’s this TV show about these very wealthy televangelists. They have the three planes, the Father, the Son, and the Holy Spirit. I thought that was just one of the most hilarious parts of that show. So then within all of these different models, obviously we’ve talked about Jet It throughout this and how they might fit in, but talk about Jet It. What is it as a company? I guess we didn’t dive into that nearly as much. Let’s dive into Jet It as a company, and then how it fits in with the ecosystem of private flying.
Glenn Gonzales: So, at Jet It, we operate a fleet of Honda Jets and Gulfstream G150s. As soon as we receive our next airplane, that’ll bring us to 26 airplanes globally. It’s 26 airplanes meaning last year we started our operations in Canada, as well as in Europe. And in Europe, my co-founder runs our European operation called Jet Club. We’re excited because we’re the only company in private aviation to have regulatory approval in three geographic regions. So, we’re super excited about that. Our program is we are a fractional, as we’ve mentioned. We’re days based whether it’s 25 days a year or 130 days a year. We’re excited to have a solution for the marketplace that provides them with access to a whole aircraft crew all in for $1,800 an hour and it’s your airplane for the day. So, you can fly to multiple places during that day, or you can fly to one place during that day, whatever it is that you want to do, let us know in advance. The airplane shows up at the time that you want it there and takes you to your destination with our professionally trained crew. I think that’s kind of the high level synopsis of who we are and what we are. I think the bigger piece to it though is that there are only two things of great priority at Jet It – operate safely, make people happy. Sometimes those things don’t always coincide. Because we have to operate safely, it might make a customer unhappy, but you can rest assured that the decisions that our crew members are making are always above board and smart as related to making sure that our customers arrive at their destination safely.
Alex Bridgeman: Yeah. I want to hear a little bit more about, because as an aviation geek, I love studying airlines, and Southwest is one of my favorite, which it sounds like you’ve done a similar model with at least one type of aircraft for the most part. I’d love to hear what are some of the differences between as a business operator, as a CEO running a company, what is it like running an airline, a commercial airline, with scheduled flights versus charter? It seems the business models are very different, but both roughly in airline travel of sorts. What are some of the differences between the two as an operator?
Glenn Gonzales: I mean, it’s tough. We are a private airline. It’s scheduled, but wildly unscheduled. By that, I mean it’s scheduled for tomorrow, but tomorrow could change with an aircraft anomaly. Tomorrow could change with the customer needs that I need to adjust my time or I need to adjust the number of passengers with me. It’s scheduled in a sense that our customers are asking for their needs, and our airplanes are moving all about the country. We’ve got airplanes in every corner of the US and they’re flying and supporting our customers anywhere and everywhere they want to go. It’s constantly a flux and we have some amazingly smart and intelligent people that are on top of the schedule. They’re in constant communication with our customers, making sure that their needs are met, while our crew members are moving the airplanes from A to B and taking care of our customers and the process. I mean, they are the face of our organization on the road while operating the airplane safely and moving this highly flexible schedule where you have so many variables with weather and winds and customer needs. And you’ve got to always, of course, operate the airplane safely and duty day restrictions and the FAA. I mean, it just never stops.
Alex Bridgeman: Yeah, no kidding. Speaking of logistics, one question I’ve always had about private flying is when the passenger, like the folks get to the destination that they’re wanting to go to, does Jet It help arrange a car or some mode of transportation from the airport to the office? Or do folks typically rent a car or take an Uber? What does that typically look like?
Glenn Gonzales: Yeah, look, our job isn’t just to get you to and from, we have a 24/7 concierge team that is receiving every ask and need of yours as one of our customers, whether it’s flying as a share owner or as a charter customer with Jet It. When you get to your destination, if you are seeking transportation, we’ll arrange a car service, we’ll arrange a rental car. And if the airport allows that, the service will be there ready to pick you up. As soon as the engine is shut down, we’ll pop the door open, and we’ll get your bags and you’ll be on your way. It’s one of those little, small nuance benefits of traveling privately that I landed, or I show up to the airplane and I’m airborne five minutes later, I land and I’m on my way to my destination, again, within 5 to 10 minutes of being on the ground or arriving at the airport. If there’s something that you want food-wise, it’s there for you. If you need us to coordinate reservations. I mean, if it’s legal, we’ll do it for you. And there’s no additional cost for it. We’ll just pass on the direct cost to you. But that’s part of the service that we offer.
Alex Bridgeman: That’s fantastic. And I had a different episode with a different entrepreneur, and they had shared quite a few what they called near-death experiences in their business as they grew. I’d be curious, what are some hard times, near-death experiences, like, oh crap, what’s going to happen to Jet It kind of moments early on in the early days of Jet It?
Glenn Gonzales: One of my mentors, a gentleman I mentioned earlier, he said, “Glenn, you should never stray from 5% of your business model. If you can avoid doing that, then your business, you’ve got a sound business plan.” And so there haven’t really been any oh my gosh moments in our business, primarily because the airplanes have done what they’re supposed to, our team has done what it’s supposed to, and we’ve all been disciplined about sticking to the game plan. By sticking to the business model that we put together, we talk about the difficulties of running this dynamic airline, but really, it’s in line with what we outlined. It’s the game plan that we’ve put together. My co-founder and I, we spent two years writing out every little nuanced detail of this business model. It helps that we’re aviators. There’ve been a lot of wealthy individuals humbled by this industry. And we built the model based upon that knowledge of the industry. I’ve done everything from the fighters to cleaning the lavatory in the airport. We’ve been around it. We understand what to expect, what’s coming next. And those things have really helped us and then surrounding ourselves with amazing people on our team. I think we’re almost 170 strong now throughout Jet It. It’s just been a great experience for us to be able to stick to our plan and recognize the challenges that are forthcoming.
Alex Bridgeman: And big part of Jet It is the service element, of course. So, there’s folks on your team who are interacting with customers all day long for extended periods of time. How do you hire and recruit folks who are really good with customers in lots of different situations and perhaps some tenser than others? How do you continue to find those types of folks?
Glenn Gonzales: The main thing that we want, and we kind of have a template for what we’re looking for at Jet It. We call them our five Cs, and I’ll spare you all of that. But that onboarding process, it consists of people and we’re listening for those five Cs, we’re paying attention to people who live and demonstrate our values as an organization. And it starts at the onboarding, making sure that we have the right people in our organization. When it comes to service and support, we want servant leaders, people who are compassionate and demonstrate compassion and empathy towards other people. And we want them to demonstrate that in our discussion with them. If you’re dealing with empathetic people, people who can put themselves in the shoes of someone else, then most likely they can be a good customer service person. Obviously, they have to be a good communicator. We want someone who understands our industry, but we can teach you the industry. The first thing we want are servant leaders who are service minded and focused on making sure that someone else has exactly what they need and they’re well taken care of.
Alex Bridgeman: That’s fantastic. What do you see as the future of private travel? What are some trends that you’re noticing and what do you think 10 years from now this landscape will look like?
Glenn Gonzales: When people ask about Jet It and why we started when we did, look, COVID and everything that’s happened has been a boom for our business, for our industry, I should say. But at Jet It, we kind of view it as this was inevitable. This surge that we’re seeing in private aviation just had to happen. That autonomy and efficiency that we talked about, that’s why people choose travel. If you look at the history of transportation and you go all the way back to horse and carriage, if you had the means, you had a horse and carriage. If you didn’t, you were walking. Why? Because the horse and carriage is more efficient. If you then fast forward to today, the most efficient and autonomous way to travel is to do so privately. So, if we at Jet It and other companies that follow the Jet It model and other companies that come behind us and new technologies that come about that can do it cheaper or less expensive from that physics standpoint that we talked about, those things mean that it’s inevitable that there’s a shift in the industry and that shift is happening right now. I think it will continue. And the end result of that is the service ends up getting lower and lower because the margins are already so tight on the commercial side of the house for commercial aviation, you have very tight margins, you have more people moving away from it. So, the service then is the first thing to suffer in that particular instance, which then drives more people who can afford it towards programs and services like Jet It. So, I think the future is here. We’re right on the leading edge. We like to say that we at Jet It are on the leading edge of the evolution of transportation, and for where technology is today with the service levels that can be offered and our innovative business model, we feel good about our position.
Alex Bridgeman: I love the leading-edge aviation pun, by the way. That’s awesome. There’re tons of aviation puns you can use, which is part of the fun I imagine. With some of the things you’re doing with Jet It, is that part of what takes private flying from maybe not to the masses, like to everyone, but at least makes it significantly more affordable than that kind of 15 grand, 20 grand sticker price to do a New York to Miami flight? What are some of the things that need to happen to make private travel even more accessible than it is today?
Glenn Gonzales: Combustion. Combustion is that part of physics that allows us to go faster. If I can reduce the cost of that combustion, electric – at Jet It, we’ve made a significant investment and buy aerospace and a number of aircraft that we will buy from them – if I can reduce my costs from a technology standpoint, the cost of moving from A to B, then if I could still go equally as fast as I can with combustion, with a turboprop or jet, there are limitations in all propeller aircraft, but the faster I can go at the lower price line, that technology will be that next shift that allows more people to have access to private aviation. At Jet It, we think it’s going to be electric aviation. There are a number of challenges from a logistic standpoint, there are a number of challenges from an engineering standpoint on the hydrogen side. There’re some super smart people working on it, so I wish them all the luck. But from our research, electric is everywhere. Our electricity is everywhere. And so, to have an electric aircraft that like the eFlyer 800 that can fly at the same speed as a King Air, but at dollars per hour versus hundreds of dollars per hour, it’s just that will be a big game changer. And we’re super excited to be, again, on the front edge of that or the tip of the nose, on the nose of the aircraft as we enter into a new horizon in our industry.
Alex Bridgeman: And so, when you talk about cost savings going to electric, on the flight we’ve used throughout this episode, the New York to Miami from 15 to 20 grand, where does an electric plane drop that cost to?
Glenn Gonzales: I mean, the airplanes have a cost per hour. When I used to fly the Gulfstreams, it was somewhere around $3,000, $4,000 an hour to fly those airplanes, and then you have your crew costs and all of the other fixed expenses that are tied to the aircraft. And that’s where the $5,000 an hour, that $15,000 number comes from. But with an electric aircraft, I’m cutting fuel out of the cost, and fuel in that hourly rate is typically somewhere around two thirds the cost of the operation of the airplane. So, if I can cut out two thirds of the cost from that $3,000 an hour to operate and I take out $2,000 of it, now I have the airframe, I have the engines, in this particular case, the electric motors that require inspection and evaluation, and the airframe that requires inspection and evaluation, but I no longer have the fuel. So, it’s just the kilowatt hours that I’m investing into charging the aircraft. It’s the battery refurbishment over a period of time. And some of those things are still to be determined, but the cost is reduced dramatically without the fossil fuels driving the combustion in order to go fast.
Alex Bridgeman: Wow, that’s a significantly more substantial savings that I imagined it would be. I didn’t realize two thirds of the cost was fuel. I figured it might be 50%, but two thirds is a big chunk.
Glenn Gonzales: And that’s a variable expense because right now fuel rates are through the roof and everywhere, and in aviation just the same as our own automotives. So, if you double the cost of fuel, you just increased the cost of your operation drastically. And that cost has to be transferred onto the traveler, the aircraft owner, the fractional user. And so, it is a challenge for our industry. And so as soon as we can pull that out and have an electric vehicle that can fly at similar speeds, I think you’ll see the price point of their operations continue downward. We do have to hope that those manufacturers can develop those airplanes faster and they can do so at a lower price point, and that’ll be the other piece. If you have to trade off what’s a $5 million, $6 million Honda jet for a $12 million electric airplane, well, you’re kind of losing out on some of those benefits. But if we can have an equal value in the aircraft price point without the variable costs of fuel, life gets much better and we can open up private aviation to a much larger pool of travelers.
Alex Bridgeman: Yeah, that would be a significantly larger pool. Moving to some closing questions. What college class would you teach if it could be about any subject you wanted?
Glenn Gonzales: That’s tough. Look, I love communication. I love leadership. I love what we’ve been able to do as a team and kind of organizational theory. So, I think anything around growth and development. I’d definitely stay away from engineering. I understand a lot of it, but you don’t want me doing your math calculations.
Alex Bridgeman: That’s awesome. Yeah, I don’t think people want me doing theirs either. Engineering is not my forte. What strongly held belief have you changed your mind on?
Glenn Gonzales: Strongly held belief that I’ve changed my mind on. I’ve been very blessed to have amazing parents who taught me to stand on what you believe, to live life without regrets, and I don’t have any regrets or anything that I’d changed my mind on. If anything, I’ve learned to kind of slow down a little bit in life. It’s very necessary. So maybe that’s one of the things that I’ve learned, to pace myself a little bit more versus charging hard 24 hours a day, seven days a week.
Alex Bridgeman: Do you think the charging hard 24 hours a day, do you think that’s what got you to where you are today to where you can now slow down a little bit? Or do you think you could have been a little bit slower throughout your career and things would have gone just as well?
Glenn Gonzales: I think I probably could have slowed down and things would have continued the way that they did. The things that I’ve been blessed and fortunate to accomplish in life in large part were the support of other people being there at the right time helping me achieve my goals and dreams. I have a saying, you either dream big or you don’t sleep. And I have very big dreams. And I always have. I wanted to fly. I wanted to fly fighters. I wanted to play division one sports. Big dreams that not everyone has the fortunate opportunity to experience, and I’m very grateful and thankful for those experiences. But once you have that dream, you’ve got to chase it. You’ve got to go after it and go after it fully. I think I probably didn’t have to go after it as hard as I did at times, burning the candle at both ends and in the middle, but it’s still been a fun blast and fun ride all the way.
Alex Bridgeman: Certainly. What’s the best business you’ve ever seen?
Glenn Gonzales: I hope it becomes Jet It. I’m excited about where we are and what we’re doing. I love the Southwest Airlines business model. I mean, gosh, they’ve been successful year over year since inception. I mean, there’s so many great businesses, and there’s so much you can learn from those companies that have succeeded and the ones that have failed. So, look, I’m just kind of a business nerd. I’ll sit and read case studies all day long about companies. And I’m excited that Jet It was honored to have a Harvard Business School case study written on our business model. But I love them all. I couldn’t choose just one.
Alex Bridgeman: Maybe a better version of the question is who are some aviation entrepreneurs that you admire and you watch closely to see what they’re up to?
Glenn Gonzales: I love what Scott Kirby is doing at United Airlines. He’s a fellow academy grad. Scott is innovative in his thinking. He’s constantly pushing the envelope with how they are trying to create value for their shareholders. He’s not afraid to make change. He’s not afraid to innovate. So that’s someone present day. If I were to look backwards in time, Bill Lear and everything that they did to introduce private aviation to the world, it was just remarkable to be a visionary to see what we found to be autonomy and efficiency and how to bring it to the marketplace. I love what George Bye is doing from a future standpoint, bringing electric aviation to the masses. It’s going to change how we travel. So those are some of the present day, past and future that I think are remarkable in our industry. And I love to see what they’ve done and are continuing to do in business.
Alex Bridgeman: Yeah, those are phenomenal examples of really talented entrepreneurs. One last fun question. You’ve flown a lot of different planes and I would just love to hear what are some of the differences, besides some of the obvious, between flying something like a Honda jet versus your F-15?
Glenn Gonzales: Wow, man, Alex, the F-15 is a marvel. The world’s greatest superiority fighter, the F-15 Eagle. To be able to stand an aircraft on its tail and to climb straight up and accelerate in the process or to fly well above the speed of sound. And I always think about supporting our nation and operation, where we would support the president or dignitaries. And George Bush was at the time in Kennebunkport, Maine, and it was my birthday. And taking off on my birthday and flying with armed weapons on your airplane and seeing the sunrise with your wingman flying next to you is one of the most surreal experiences in aviation that I have had. It was amazing. But on the flip side of that, when I take my most incredible experience in private aviation and just aviation in general, and having the opportunity to fly recently deceased, passed away, a great man an original Tuskegee named Charles McGee, to have this 99-year-old man flying next to me on his birthday, one of the men who created opportunity for me to even be in aviation, it was a tear jerking experience. I literally cried, and my wife will tell you I don’t cry often. She had never seen me cry until I told her about that. She still hasn’t. But it was such an emotional experience. And that was brought to me in a Honda Jet. So, I’ve loved every airplane that I’ve flown. Any pilot will tell you the airplane that I’m flying and I land safely is my favorite airplane that day. But it’s each experience that brings so much joy, and I’m so grateful for those moments in time.
Alex Bridgeman: That’s fantastic. I love that story. Thank you so much, Glenn, for sharing your time today. I’ve really, really enjoyed getting to talk all about private flying, different options available, Jet It, flying F-15s. I’d love to chat for three hours, but we can’t do that unfortunately. But thank you for sharing the time you did today. I really appreciate it.
Glenn Gonzales: Thank you so much, Alex. This was a treat. You drew some new things out of me, some great questions.
Glenn is the founder and CEO of Jet It, a fractional share private jet business with a unique model serving customers across the country and in Europe.