Elevating Air Charter: The Stratos Model for Consistency and Trust in Private Aviation

In this episode of OpenSkies, host Chris Glass speaks with Joel Thomas, founder of Stratos Jet Charters, and Darren Engle, the company’s Chief Growth Officer, about transforming the fragmented world of private aviation. What started as a one-man brokerage has evolved into a franchise model that empowers others to own and grow their own jet charter agencies—with the full power of Stratos’ infrastructure, safety systems, and flight operations at their back.

Joel and Darren unpack the challenges of scaling a jet charter business, from booking flights and vetting air carriers to managing working capital and building client trust. They also share how departmentalizing operations, building proprietary tech, and staying true to strong values have allowed Stratos to deliver a consistently premium experience. Whether you're an aviation entrepreneur, private flyer, or someone who loves stories of purposeful business-building, this episode offers a candid and inspiring look at what's possible when you rethink how private aviation can work—for everyone.

• Connect with Stratos Jets: https://www.stratosjets.com/
• Learn more about the Statos Jets franchise or inquire to become a franchised agency owner: https://www.stratosjets.com/franchise/
• Connect with Joel: https://www.linkedin.com/in/aircharter/
• Connect with Darren: https://www.linkedin.com/in/darren-t-engle-571a546/
• Follow Stratos Jets on LinkedIn: https://www.linkedin.com/company/stratos-jets

Transcript

Chris Glass: 0:00

Stratos 1.0, as you called it. That was really going through all of the growing pains of setting up your own brokerage.

Joel Thomas: 0:06

You know I'm a God guy. I believe he leads us to our path. It kind of happened serendipitously. What I learned was I needed to departmentalize. I needed to go from everyone running their own desk to a departmentalized structure where the air carrier and the customer all get the exact same consistent Stratos customer experience.

Darren Engle: 0:27

That really allowed us to make the decision on pivoting the organization from being a jet charter brokerage to being a company that now sells jet charter brokerages.

Joel Thomas: 0:37

You know, our team of flight coordinators have all been with us for five or more years, resulting in them having processed thousands of charter flights, booked thousands of charter flights.

Chris Glass: 0:48

So that must mean the air carriers really like to do business with you because they know what they're getting all the time.

Darren Engle: 0:53

This is a bespoke services business. You want to be able to provide that and that's all done relationally.

Chris Glass: 1:01

Ladies and gentlemen, welcome to another episode of Open Skies Podcast. My name is Chris Glass, I am your host and I am here with Joel Thomas and Darren Ingle from Stratos Jet. Gentlemen, welcome to the show.

Darren Engle: 1:14

Thanks, chris, thanks for having me.

Chris Glass: 1:16

And both of you have excellent backgrounds there tarmacs and airports. I love it, joel. I'm going to start with you. Tell me a little bit about yourself.

Joel Thomas: 1:24

Okay, I'm Joel Thomas, the CEO and founder of Stratos Jets. I started the company when I was 25. Well, 26 is when we incorporated, and I've been running it ever since.

Chris Glass: 1:37

Now you have a long history of aviation in your family, correct?

Joel Thomas: 1:42

I do. Yeah, my dad, my dad was a pilot. He I was probably 10 or 11 when he got his pilot's license and and he got hooked, and I got hooked as well and I became a pilot myself. So I'm instrument rated pilot now.

Chris Glass: 1:57

And what? What plane do you fly?

Joel Thomas: 1:59

A Bonanza. My dad bought a Bonanza when when I was a kid and kind of fell in love with the Bonanza the Beechcraft line. And yeah, I fly around in a G36 2010. Very nice Bonanza.

Chris Glass: 2:14

Fantastic and Darren, you're also a pilot, correct?

Darren Engle: 2:17

Correct. Yeah, I got my pilot's license, I want to say about seven years ago. Time flies, as they say. Yeah, I've been pursuing. I mean, there's never a point in time in which you stop learning as a pilot, so there's always an endorsement or a rating that you can pursue training, you name it. So I love aviation from that perspective. It's always continuing to improve and educate yourself on all things flight.

Chris Glass: 2:48

Now, your background isn't in aviation. You have more of a mechanical engineering background. So tell me a little bit about yourself.

Darren Engle: 2:56

Correct, yeah. By trade, I'm a mechanical engineer Graduated from the University of Central Florida in 2001. I started my career off at Siemens Energy, designing and developing gas turbine engines. The entrepreneurial bug hit and I left there and started my first company in 2006. And that was a company that was focused primarily on energy and automation technologies. Fast forward today I have my MBA serial entrepreneur, been involved in numerous startups and high growth technology centric companies, and, yeah, that's what led me down this path. Actually, you know, I was was working with Joel for many, many years and more on the advisory side, and an opportunity came up that I had to jump on.

Chris Glass: 3:53

Now Joel, tell me a little bit about how Stratos got started. How did the company begin?

Joel Thomas: 3:59

Yeah, it kind of happened serendipitously. You know I'm a God guy. I believe he leads us to our path and for me, you know, I was a college grad working at a large investment firm setting up 401ks, and I always felt like I was one bad month away from maybe not even being there anymore. So I was really looking for kind of like my own next right step in life. And there was a girl that I was in college with who was an executive assistant for one of the founders of the Magic, for the son of the founder of the Magic. Anyways, he needed a private plane and I was always trying to get her to come flying with my dad and me or come out to the airport for a first Fridays fly in. And so she knew I had an interest in aviation and she reached out and asked me she's like hey, can you help me organize a flight, or who do I talk to? I told her I could make it happen. So we did, and I wasn't expecting anything of it really, but the air carrier gave me a nice referral check and they said look, you keep the clients coming and we'll keep the checks coming, and we figured out kind of how to broker from there.

Joel Thomas: 5:08

It was interesting because you know my dad was pretty involved with this and he observed kind of the way the company that we hired to do the job handled things. And my dad pointed and said you know you can build a better jet charter company than this. And I believed him and set out to do it and so far pointed and said you know you can build a better jet charter company than this. And I believed him and set out to do it and so far I believe we have. You know we originally in Stratos 1.0, I know the challenges of building up of a charter brokerage. Really you know we built the business first. I built the business so that I could sell charter myself.

Chris Glass: 5:44

So when we're talking about Stratos 1.0, as you called it, that was really going through all of the growing pains of setting up your own brokerage. Talk to me about that challenge.

Joel Thomas: 5:54

Yeah, so I mean originally, when I first started, you know I didn't have like I wanted to glorify God with my work, but I didn't really have like a grand vision of exactly what it would look like. What I knew was I wanted to glorify God with my work, but I didn't really have like a grand vision of exactly what it would look like. What I knew was I needed to deliver a good customer experience and build some good relationships, and so I created processes that allowed me to be more efficient. Like my first charter was a Word doc and a Excel spreadsheet to put quotes together, and then we turned that into the very first Stratos. We called it Stratos Admin at the time. It became Stratos FMS and once it was in the tech platform in Stratos Admin. That allowed me to hire people who could basically run their own little book inside of Stratos Jets utilizing our tools, so basically to duplicate myself, and that's kind of the genesis of how we grew the business. But by age 30, maybe 31, I recognized we're doing 20 plus million dollars in revenue. Every salesperson is using my system, but they're not necessarily coordinating and organizing and doing things the same way. I hear from air carriers that this guy forgot that and clients we would lose clients left and right because the customer experience and I'm providing them all through marketing right. So I'm spending a lot of my own money to get these clients and I wanted my agents to maintain them because there's a lot of cost in generating a client. So what I what I learned was I needed to departmentalize. I needed to go from everyone running their own desk to a departmentalized structure where, upon closing, the air carrier and the customer all get the exact same consistent Stratos customer experience, all get the exact same consistent Stratos customer experience. And that was probably by 2012, maybe 2011, that we decided to departmentalize.

Joel Thomas: 7:50

And when you departmentalize, you all of a sudden have fixed expenses. Yeah, a lot of fixed expenses. You know, we had several hundred thousand dollars all of a sudden out of nowhere in salaries. Previously, everyone was running a full desk. All that money could be thrown into marketing. Now we had to balance that. You know, okay, we have to keep these people on like having a slow month. I gotta pay their fixed costs. That means I have to cut back on marketing. Well, if I cut back on marketing, are we gonna be able to generate enough new clients and enough new revenue to be able to cover their costs down the road. So there was a large balancing act that was actually really difficult to overcome. You know, I feel that we're very blessed. You know, the people that we've attracted on our team care about their work product. They also care about their own relationship with the customer and that's allowed us to have deep relationships.

Joel Thomas: 8:47

And then, from a operational support standpoint, when we added, when we added flight operations, when we departmentalized, when we had the accounting gosh, before they were running, they were finding their finding their own aircraft. They were booking the flight. They were finding their own aircraft. They were booking the flight. They were organizing the flight. They were making changes and everything to the flight and adding passengers and then they were chasing down invoices and payment.

Joel Thomas: 9:14

Once we took all that off of their plate and left them with organizing not organizing but finding the aircraft and managing that client relationship we expanded their productivity peak tremendously. When you're running a full desk I mean I've done it myself, I think 17 flights a month and you're pulling your hair out. You know one every other day. You've got too many things going on and you will start booking flights out into the future that you're going to have to focus on and think on, but having the departmentalized structure that we have in place now and we have had for more than 15 years probably we have a lot more time on our hands to focus on ensuring that we're getting the best possible aircraft and aircraft operator for every flight, making sure that we're servicing the client better essentially. So it's really been a good thing.

Darren Engle: 10:05

And that's a great point.

Darren Engle: 10:06

Point because one of the things that I definitely wanted to talk through was why we pivoted, or the inflection point where the pivot was made, and Joel just did a great job at explaining the evolution from Stratos 1.0 and beyond, and through those decisions the strategic decisions and investment into personnel and infrastructure, departmentalization and technology, really built the foundation for us to be able to extend an ownership opportunity to those types of agents that were pouring themselves into the organization.

Darren Engle: 10:52

There will be people that never really want to own and operate their own jet charter brokerage. They just want to be agents. They're very happy with that and there's a place for them, but then there's a place now for those that want more, and so we were able to really look at that, and that was one of the points that really allowed us to make the decision on pivoting the organization from being a jet charter brokerage to being a company that now sells jet charter brokerages, and that pivot was not an easy decision, but Joel ultimately made that decision and decided that that was what was not only in the best interest for the industry but also for those agents that really were looking for the next right step, and so that was really the foundational point that really enabled us to make the shift and pursue this new model of operating.

Joel Thomas: 12:00

Yeah, the balancing act between where does my money go? You got a bucket of money every month, right. Where does it go? Does it go into marketing? Does it go into operational support, like the personnel and the infrastructure, the office space, or does it go into tech development and having to, you know, over 18 years having to do that balancing act myself, you know we were successful, but it was a long road of organic growth in order to do that. With our franchisees, they come on board instantaneously, day one with the infrastructure that's already established for them. And the great part is, if they have a down month, they don't have outflows, right? It's a performance-based model. So they only pay for services or infrastructure when they sell. So if they have a down month unlike my road, if I had a down month, I'm still paying all those expenses. But with this new model, when someone does have that down month, well, guess what? Their operating expenses are reduced. They don't have to pay for those outflows.

Chris Glass: 13:09

So what is the mission of Stratosjet?

Joel Thomas: 13:11

Well, the mission was to provide an air charter service that educates our clients and helps them to make an informed buying decision. So we've always thought of ourselves as kind of an advocate for them. So we will analyze the air carrier, you know, we'll scrutinize their operational history, their performance working with us, you know, and we help the customer to make the decision based on is this the right airplane, is this the right air carrier to operate it? Then we advocate for the best possible crew, the most experienced possible crew, for every single flight the most experienced possible crew for every single flight Right?

Chris Glass: 13:53

The world of private charters is somewhat the Wild West, with a lot of different companies and a lot of different operators out there, so safety is always top of mind. So how does that work at Stratostat? Why is safety such a big thing?

Joel Thomas: 14:01

Longevity. We care about our clients. We want to make sure they have a safe travel experience so they'll come back. But but there's a lot of, there's a lot of variation in their operators. This is the thing that most clients don't really understand is, right, you can have.

Joel Thomas: 14:18

There's several different levels of an air carrier. There's a basic 135. There's a, and then there's a 10 or more right, a worldwide, 10 or more, and they have different levels of government involvement and different capabilities. On a basic 135, you can't have 20 aircraft under the fleet. You don't have departmentalization, you don't really have those resources, and so for us, what we try to do is evaluate every air carrier that we'd ever work with and understand their infrastructure, their operational structure, how they work and how well capitalized they are.

Joel Thomas: 14:55

You know, are they the company that's, you know, squeaking by and they're going to MEL a maintenance item and still do the flight just to get it done? Or are they the company that says, hey, we're going to put this airplane down, yeah, there'll be a delay, but we're going to replace it with an alternative? We want to get a good insight into each and every air carrier, and so over the years, we kind of learned who does things right, and we've gravitated in our own business towards the world's best air carriers and I'm proud to say that last year 90% of the revenue we did was on fewer than 35 air carriers.

Joel Thomas: 15:38

So, deep, meaningful relationships with the world's best air carriers, and it seems to benefit our clients really well.

Chris Glass: 15:44

So you're doing all the vetting on behalf of the clients, right? So as a client, I don't have to have any of that at my forefront. I can just trust that Stratos has that taken care of.

Joel Thomas: 15:54

Yeah, so as an Argus certified broker. So I mean any company can say they've got a safety program right. They can put it on their website and say, yeah, we only use Argus Gold or Better Operators Anyone can say that. But actually to demonstrate that to be certified by Argus means that Argus, the world leader in aviation safety, actually comes into Stratos Jets, evaluates not only our process but a large number of flights to ensure that every time we followed that process, a large number of flights to ensure that every time we followed that process. So we've been an ARGUS certified broker since 2014. I believe it's 2014. That's when we got certified. It might've been 2013, but for over a decade. And it's an important designation for us because we don't just say that we're safe, we're evidence-based safety program and fortunately we've never had any fatality, any injury or any kind of a bad travel experience. So we're very grateful for Argus' designation and the opportunity to really communicate that to our client base.

Chris Glass: 16:59

Right, and now I want to touch on something a little bit different that you guys are doing from other brokerage companies and other private aviation companies. So my question for Darren, because you've kind of been quiet so far talk to me about the franchise model.

Darren Engle: 17:19

Yeah, end of 2023,.

Darren Engle: 17:21

Joel and I were chatting and he was wanting to grow his jet charter brokerage even larger so that his mission and vision could be realized sooner, and with his passion for aviation and his advocacy for his clients, you know, and with the degradation, if you will, and the services being provided in the industry due to fragmentation, we started looking at different models that might allow us to be able to scale and grow through ownership by extending that out.

Darren Engle: 18:01

And so, when we looked at the different models that were available, uh, franchising came up as a potential pathway. Um, franchising the brand and, given all the the, the history of the brand and the strength of the brand um, I felt that that it would be a great path for us to move forward. And you know, joel and I talked through that in in depth. Um did some, did some modeling to make sure that the um, the numbers, would work out and that we could provide a service and an opportunity to people that would really allow them to be able to step out and own their own jet charter brokerage with and provide a level of service and quality of safety that was on par with some of the best brokerages out there.

Chris Glass: 18:53

So if I'm a successful broker already, why would I be interested in joining Stratos as a franchise owner?

Darren Engle: 19:00

Yeah, I mean so. If you're being in the industry, if you're going to be yeah, I mean so. If you're being in the industry, if you're going to be working, if you're a broker, you're going to be working for someone else. And if you ever thought about starting and owning your own business but don't really have the entrepreneurial background or the business background, there's a lot of unknowns and there's a lot of risk associated with stepping out and starting something for yourself. While you may be really good at sales and relationships, that doesn't necessarily translate into the business world and there's a lot of non-generating revenue activities that consume a lot of your time, that distract you and pull you away from your core competency. This pathway allows them to transition into ownership and create a pathway for them for growth, not only professionally but personally, and it allows them to have all of the support that they need along the way to build a successful company.

Chris Glass: 20:03

Now, Joel, what kind of support do you offer a franchisee?

Joel Thomas: 20:07

A tremendous amount of support. So from day one we provide all of their technology right. So our Stratos FMS platform it provides service end to end, from inbound lead all the way to wheels down and re-engagement. It's a technology platform that manages all aspects of the client's travel. It's built on the Salesforce architecture, so that's where it begins.

Joel Thomas: 20:31

Upon booking, once they have a client who's interested in booking, we manage the payments for them, we manage the cash flow to ensure that the air carrier can be paid, to ensure that the federal excise taxes are being paid. So from all of the accounting aspects, and then we also do, upon confirmation, we do all of the coordination and organization for them as well. You know, our team of flight coordinators have all been with us for five or more years, resulting in them having processed thousands of charter flights, booked thousands of charter flights, booked thousands of charter flights. So these guys have extensive experience and they're available to immediately book any volume of business for a broker or a brokerage that wants to come on board. And we do all of this on a transaction basis, so there's no ongoing fees for the franchisee. It's done on a transaction, flight by flight basis, so they don't do any flights, they don't have any outflows. If they do a hundred flights, they have the resources and the infrastructure there to process and manage all of their flights. So it's a very scalable model.

Chris Glass: 21:38

Right. It allows that franchisee to take a vacation if they need. It gives them some flexibility.

Joel Thomas: 21:44

We are in private aviation. I don't know if there's anything called a work-free vacation, but yeah, they can work remote and know that they've got the backup there to support them.

Chris Glass: 21:54

One of the side effects of the pandemic is we could all work from home and we could all work from our vacations.

Joel Thomas: 22:00

Yeah.

Chris Glass: 22:01

So one question I have for you how do you select your air carriers, because there's so many PGA operators out there and there's so so many different types and kinds? How do you decide which is the right partner for Stratos?

Joel Thomas: 22:16

That's a good question. Well, I mean a lot of it is mission dependent. So if an air, if a client, has a obscure need out in Alaska, you know and they need a caravan, what we'll do is we'll identify all of the air carriers that are in Alaska, that you know and they need a caravan. What we'll do is we'll identify all of the air carriers that are in Alaska that are capable of accomplishing that mission and then we will evaluate their operational history through either an Argus check report or a safety intelligence report through Wyvern. We also evaluate their FAA. You know their DO-85, their FAA, their DO-85, their ops specs, anything that the government publishes. We get that on file and evaluate that to ensure that they are safe and that they're compliant and that they're doing things by the book. From there we ensure that they carry a minimum liability insurance. So for the example I was mentioning, the caravan, we require $25 million on turbine turboprop aircraft and that's actually a very high standard. Most turboprop aircraft are insured for $5 or $10 million. So that eliminates a lot of the carriers and that additional expense for that insurance is pretty significant. So that kind of speaks towards the financial stability and the ability of that air carrier to make investments in their own business. So it just kind of reads out a lower quality air carrier essentially by having that standard there for them. For jets it's a minimum of $50 million, going up based on the number of seats on the aircraft, but like a light jet we'd want to make sure it had at least $50 million liability. So we analyze those things. We make sure that they have a flawless safety rating going back at least seven years, which is as far back as we can look in the check registry.

Joel Thomas: 23:59

Fortunately, stratos keeps its own records and we can look back to 2006, 2007,. Actually when we first started the Stratos FMS. We have records going back that far on many air carriers. So it's a deep dive in an evaluation of kind of their operational history. Then we evaluate their infrastructure. Are you a departmentalized organization or does the guy who's quoting fly the airplane also organize the flight? Do the accounting? Does he do all that? Because there are companies out there that are like that and they give really cheap prices because they don't have the infrastructure and they can do it for a lower margin. So we try and evaluate that on every air carrier. What's their infrastructure like? What investments have they made in personnel, in technology, in resources, to really ensure the customer experience is reliable and consistent.

Chris Glass: 24:53

Right.

Joel Thomas: 24:53

Then communication is also another big. We're very big on communication. Are they responsive? Are they truthful? You know those types of things are key criteria of our approved vendor program.

Chris Glass: 25:08

Okay, so you have an approved vendor program. Having an approved vendor list, what does that mean for your clients?

Joel Thomas: 25:17

So, yeah, that's a good question. So having an approved vendor program, I mean that immediately lets the customer know that anybody that we're going to quote has to already be approved, that anybody that we're going to quote has to already be approved. So we have every air carrier in the entire world in our system because they're published by FAA or whatnot. So we have every air carrier in our system but many of them are left as unauthorized and we'll do an evaluation if it's necessary, but we can't quote. Our system won't even allow a quote to be generated on a carrier that isn't already approved. They just don't even show up in our tool. So the the approval means that you know that they have a flawless safety rating, that Stratos has deep, meaningful information about the air carrier. You know they can rest assured, knowing that the aircraft and the crew will meet a certain standard.

Darren Engle: 26:12

Yeah, and we've been able to expand that just to add on to what Joel was saying, is that approved vendor program.

Darren Engle: 26:20

All of those vendors go into FMS and are accessible.

Darren Engle: 26:25

So every time one of our agencies books a flight on behalf of their client through our system which every one of our agencies has to do they can only book flights with those air carriers that are in our system and that and we do a scoring, as Joel was mentioning each of the air carriers are rated, and so this provides a lot of insight to an agency owner or an agent that works for an agency that's booking a flight with an air carrier maybe they've never worked with before.

Darren Engle: 27:00

We have ratings. We have and this is part of the value that unique value, the propositions that we bring to the table for someone that is seeking to own independently, own and operate their own jet charter brokerage via franchising, is that they have access to this shared knowledge base, and so, if they're unfamiliar, there's ways to find out more information about that air carrier. They can communicate. We have a Slack workspace that each of our agencies are set up with when they are onboarded that allows them to access not only information that's in our system, but also they can converse with other agency owners and agents through public channels, which allows for this kind of creating an ecosystem, a shared knowledge base that really helps educate and inform, that ultimately translates into education for the client. It's super powerful.

Chris Glass: 28:04

Right, it's a theme that I'm seeing really develop here. Is that consistency, or an industry that's faced with a lack of consistency for a long time? I know that this industry is really sexy, the private jet industry. You see that front end of it, the back end, sounds very messy and this seems to be adding that consistency side to it. What are some of the challenges with consistency in this space?

Joel Thomas: 28:30

Yeah, so obviously the quality of your carrier. So in our industry what we deal with a lot is clients treating the service as somewhat of a commodity and looking for the lowest possible price, which puts pressure on our agents or the agent that they end up booking with, to go out there and use these carriers, who may not be the most reliable we talked before. They may be a basic 135. Some basic 135s are really well organized and well run, but in general they lack the infrastructure. Right, they have one guy who wears all the hats. He's the chief pilot, thezech airman pilot of the flight. He does it all right. So so there's a lot of variation between the different air carriers. Additionally, in most brokerages, which is you know what processes the majority of flights part 135 flights. In our industry, most brokerages, they they run a full desk, their the salesperson also does the coordination and organization. So not only do they have to be good at sales and building relationships, they have to be good at identifying the best type of aircraft. So with our model where we departmentalize that, where we handle everything after the sale, one these flight coordinators on our team, like I said before, they've done thousands and thousands of flights that they've coordinated, so they're very good at ensuring that all the I's and T's I's are dotted and T's are crossed. They're also exposed to countless obstacles that we've encountered and they have a knowledge base that the average salesperson who might do 70 or even 180 flights a year for a pretty good salesperson these flight coordinators are doing more than a thousand flights a year, so they have way more experience in making sure that they can identify these roadblocks or pitfalls that might occur on any flight, which expands the customer experience or it improves the customer experience.

Joel Thomas: 30:39

But not only that. We're also servicing these air carriers. Right, we sit in the middle between the customer and the air carrier. We sit in the middle between the customer and the air carrier, and when you have a brokerage with every salesperson running a full desk, every single agent is running a different customer experience and they may be forgetful of passengers or the departure time may change and they may not change the catering order and it's lost or left behind. Well, with our model, we're also providing a very reliable coordination and organization experience for the air carrier. Right, we're simplifying their workflow by booking the flight and then planning it with their hat on, with an operator's hat on, making sure that they have instant, real-time information at all times. They can click into our trip manager portal for the air carrier and identify exactly what we expect of them at any given time. So, yeah, we're delivering a coordination experience not only for the customer, but also for the air carrier as well, which really improves efficiency and consistency in the service that we deliver.

Chris Glass: 31:48

Right. So that must mean the air carriers really like to do business with you because they know what they're getting all the time.

Joel Thomas: 31:54

Absolutely. Yeah. We hear the air carriers saying that you know, hey, working with Stratos simplifies things for us. We have less time, Plus, we have assurance that we're going to be paid. There was a carrier that came and had dinner with us and they said look, last year we worked with 600 different brokerages. With Stratos we did it multiple millions of dollars of revenue. Some of these other brokerages we might've done 80,000 or $200,000 of revenue in, and there's a risk for the air carrier, right, they don't know if they're going to be able to get paid, if they're going to block off time, and then that broker just kind of disappears without paying them, you know, or cancels the flight last minute. You know, with Stratos we do what we can to be the best possible partner for each air carrier and, like I said before, 90% of the revenue that we generate has gone through fewer than 35 air carriers.

Darren Engle: 32:52

And, as you mentioned, joel, the air carriers echo that back to us. They'd rather work with one centralized team through the booking process that they have a relationship and rapport with than a hundred different agents. Right, and that's something that we extend out through this model, through our agencies, is the efficiencies and the consistencies associated with the operational support and the financial services. Which is another great topic that we really haven't hit on yet is the financial services aspect that we bring to the table, which really allows one of our agencies to book unlimited amount of flights. They're not limited in securing the asset based on their own capital means, and so that's an advantage, and also not only an advantage, but it minimizes and mitigates a lot of risks associated operationally for them, especially if they're a new company, if they decided to pursue their own brokerage independently, then these are things that they're exposed to.

Darren Engle: 34:00

Right, they're going to be pulled in a multitude of directions.

Darren Engle: 34:29

They're going to have to focus on driving revenue to be what has caused a lot of the nonconformities within the industry, right, these kind of part 134 and a halfs, you know, the clients, that brokers working with their clients and putting them on assets to maximize margin, because they need that extra revenue to operate the business.

Darren Engle: 34:52

And you know, when you get into that type of situation that's not benefiting the client whatsoever. Right, their experience goes down because maybe they're flying in an older class of aircraft or older asset, the wrong machine, maybe they're not as safe because the air carrier is cutting corners or struggling as well. And so these are things that part of the pivot operationally for Stratos Jets and moving into this model where our focus is on the platform, the technology, providing operational support and being advocates for our agency owners, that really, you know, our goal is to really elevate the industry. Right is to set the new standard for safety and experience, working with organizations like Argus and Wyvern and making sure that we systematically are implementing into our workflows and everything we do from a policy and process perspective under one brand. Aggregating that demand is extremely powerful and beneficial not only to the agency owner as just an entrepreneur or business owner, but to the client and to the air carrier.

Chris Glass: 36:03

Yeah, so there's a uniform experience from all three levels, right? The broker, the air carrier and the client. They all get the same experience and it's backed with the money it needs to actually complete the mission. You talked about the financial side of it. Let's dig a little bit more into that. What are some of the challenges smaller companies have when it goes to trying to run a brokerage that you guys don't face?

Joel Thomas: 36:35

Yeah, so I mean, over the years we've built up a large amount of working capital that's been really valuable to us. But what a smaller brokerage would face is booking a large scale charter. Right, you know a client wants to book. Just the other day we booked Tucson to Munich. Ok, $200,000 acquisition price on a Gulfstream 650. And you know that's.

Joel Thomas: 36:58

That's not a very insignificant flight, so one it could be just the air carrier putting a hold on $200,000 and then their ability to buy and sell flights the rest of the month, since that's flying mid-June. That could be one issue. The other one could be what if the air carrier has a maintenance issue and your money's tied up? One could be what if the air carrier has a maintenance issue and your money's tied up? You have an $80,000 flight going from Portland to Orlando one way and that aircraft goes tech. Well, our business needs to be able to quickly any business would need to be able to quickly resolve that and pay the recovery aircraft operator before we even get the money back from the original carrier. So that kind of liquidity.

Joel Thomas: 37:39

Actually, I remember when we were young was a very challenging thing and it gave me a strong indication that I needed to have deep pockets and put a lot of what they call delayed gratification, put a lot of money aside towards operating expenses to be able to buy and sell flights operating expenses to be able to buy and sell flights. Another thing is as as. So we're very lucky that we built the Stratos FMS platform, but historically we used to have a lot of subscriptions, a lot of different costs. So our marketing expense, all these different expenses that would be there, personnel that would be there, whether or not we had the revenue, and that was a very challenging thing until we got to a point where we were very financially secure. So I could see smaller brokerages struggling with that, which puts the customer's deposit at risk. There's lots of stories out there where these businesses just go belly up and there's millions of dollars of deposits that are just gone all of a sudden Wow.

Chris Glass: 38:45

Now if, if I'm a franchisee, a potential franchisee, uh, candidate and I'm at one of those smaller firms, if I come to Stratos jets, I now don't have to worry about that kind of stuff. I don't have to worry about the liquidity. I could just do what I'm really good at, which is selling flight segments and selling flights. So I see why that's attractive. How do you go about selecting your franchisees? Because that must be the most important part of that. Next step that you guys are taking is making sure you're partnering with the right owners.

Darren Engle: 39:16

Yeah, I mean absolutely. You're partnering with the right owners. Yeah, I mean absolutely. It's not about for us. It's about achieving the mission and vision that Joel originally set out to achieve, which is really industry focused, and he's here to stay, and so we want to see the industry improve. Through this model, the agencies can take advantage of all of the infrastructure that we've put in over the almost two decades of being in business and so, by leveraging that, they are a lot more stable when they first start their business. So, if you're looking to buy a franchise, or if you're comparing the two models of just hey, you're looking to buy a franchise or own, you know, if you're looking, if you're comparing the two models of just hey, I'm going to do this on my own versus I'm going to buy a franchise. There's a lot of benefits that you're getting and access to infrastructure and to technology and to even through executive guidance and access to C-suite individuals that can help you know, help mold and strategize with you along your journey of growing your business.

Chris Glass: 40:28

Now, Joel, how many franchise owners do we have at Struttle Sheds right now?

Joel Thomas: 40:34

Currently there's three active. We have seven that are at various stages of onboarding. Essentially, with the franchising model, there's regulations that you have to follow, that you are going to walk through in order to onboard them, and so we're going through that phase. So there'll be seven others. That brings us to 10 franchises, hopefully by mid-June I think June 15th is our target date to have onboarded those seven.

Joel Thomas: 41:05

But to go along with what Darren was saying earlier, for me some of the criteria that we're looking for in a franchisee is really ethics One of the things that I've. Somebody told me this a long time ago. They said never short the long dollar, and it's essentially meaning just the golden rule Treat people the way you'd want to be treated. And so I'm very aware of how this industry has attracted so many. Maybe bad actors, because there's so much money floating around, be bad actors because there's so much money floating around, and what we've seen over the years is some people utilizing contracts to have cash windfalls, things like that, to have good paydays because they have a great cancellation terms that were favorable for themselves rather than the customer.

Joel Thomas: 41:56

So, ultimately, what we're looking for in franchise owners is people who share the same core ethics and beliefs in doing what's right, simply because it's right. We want to glorify God in our work. That's what I established Stratos to do, and so, for me, the type of franchisee whether they have industry experience or not, they're going to have a good moral compass and I think that's one of the most important criteria is to make that decision on. And in fact, through our, through our, we did a franchise giveaway where we were trying to empower people in the industry with a background you know with, with charter sales experience or even a small brokerages. We have had applicants who maybe don't have the best reputation that thought, hey, having a Stratos franchise would help me earn that franchise or that reputation back. So we obviously bypassed those types of people. So culture and character that's the criteria we use to find a franchise.

Darren Engle: 42:55

Circling back around, chris, to what you were saying earlier that I did actually a poor job answering, which was like why? You know who are we selecting and our criteria. Joel did a great job just actually answering that question. But it comes down to, you know, volume of applicants. We're not. This isn't like a food truck franchise, you know, or you know, a fast food franchise, if you will, where we're trying to sell tens of thousands of franchises. We're really looking at partnering with the right people and empowering them to achieve their dreams right in private aviation, and we're giving them a pathway to do that. You know, joel, as you mentioned earlier, it's a struggle organically growing a jet charter brokerage from the ground up. There are many hurdles that you have to overcome that aren't even associated with lead gen and sales activities, so we're highly selective. We have a lot of applicants and candidates that we've reviewed and they have to really you know, morally and ethically align with what we're setting out to achieve within the industry.

Chris Glass: 44:09

Right Now. I wanted to touch on the franchise giveaway because that sounded really novel and really cool, so walk me through that process. If I'm a potential franchisee and I wanted to enter that, what did that look like?

Joel Thomas: 44:24

Yeah, so the giveaway was oriented around industry professionals. It's oriented around the individual who does a great job for their clients but maybe has reached a glass ceiling, or was working with a charter broker, the owner of a brokerage who maybe has a poor reputation in the industry, who maybe they don't get along with, and they have a glass ceiling where they want to grow and build a team and do something meaningful for themselves. So the giveaway was oriented really around enabling people to take that next step in their career and, honestly, the genesis of the idea. I had Stratos 1.0, 2007 through 2013,.

Joel Thomas: 45:07

We grew a nice team and I had some people on our team that said, look, I want more than to be just a salesperson and they've gone on and built their own businesses or worked for somebody else. But some of they've gone on and built their own businesses and or worked for somebody else, but some of them have gone on to build their own businesses. And so, talking to Darren over the years, I asked, like you know, how can we prevent that from happening again? Like, what can we do to create a pathway forward, to give people something beyond just being a salesperson, Right? And so we actually explored a lot of different models. This model of the franchising enables people to take ownership of their own book of business to grow. They can grow a sales team, train somebody, have that person engage their database and start getting referrals and really grow organically their own business with all the support and resources of a large, national, established firm like Stratos.

Darren Engle: 46:04

You know, our goal is really this is simple with this. This model is you stay focused on what you're really good at doing, which is relationship building and booking flights, and we handle everything else. You know, that's kind of our motto and we, we work you it's not. You're not working for us, and so that's another important, you know, point to make is that a lot of people that are new to franchising or to business in general with this model it's one of the questions that come up they think that they're going to go work for Stratos Jets and it's like that's not the case. The case is that there's an opportunity for them to independently own and operate their own jet. Charter brokerage and franchising just gives them all of the strength and support that they need to be successful in this industry.

Joel Thomas: 46:51

Right, yeah, we're their back office. Right, we're the home office for each individual agency. So we really do work for them and it's our focus to deliver that consistent, reliable service experience that allows them to grow and scale predictably.

Chris Glass: 47:06

You know, when we started this podcast, we wanted to tell the unique side of aviation and this is a very novel, unique approach to the private jet brokerage business. So congratulations on starting something that I haven't seen before and I haven't seen this model done successfully by anybody on this level, so very cool. Where do you see Stratosjet in the next 10 years?

Joel Thomas: 47:27

Well, the vision of Stratos is to continue to, you know, educate our clients and help them make an informed buying decision. So how does that look, you know, as we continue to grow these agencies. And so how does that look, you know, as we continue to grow these agencies? Like I said before, by June we should have 10 agencies operating, Each one of them having a consistent safety program, and I would like to see Stratos being more of an influential player in the industry, ensuring that. You know, hey, Air Carrier, if you want access to the revenue that Stratos offers, raise your standard to our standard so that's one area.

Joel Thomas: 48:05

Personally, I'm a pilot, so I have some goals to own a Pilatus PC-12 and small little operator as a lifestyle business. But we want to support our agencies. If they want to do things beyond charter and be a private aviation consultant, we're going to be there to support them. When it comes to aircraft acquisitions, working on IATA certification, working on providing you know, if we build the air carrier, we'll have a director of maintenance that can help to pre-buy inspections and ensure clients buy the airplanes right rather than buying the airplanes with lots of problems. So we want to continue to grow and to continue to be a greater resource, not only to the customer base but to our agency owners as well.

Darren Engle: 48:51

Yeah, exactly, and there's a lot of other product offerings that we will bring forth to our agencies right, so that they can leverage, and that would be things like aircraft. You know sales, you know acquisition and sales placement for management. You know what are our agencies and their team right now? If they're just booking charter, this industry is very, very, very, very niche, and so the relationships that are established if someone's flying charter and they'd like to do that and they decide, hey, you know, I think I'm going to buy an aircraft, can you help me do that? Well then a relationship can continue beyond just charter. That's our hope. And to say, yes, we are our back end team, yes, we are our back end team. Stratos Jets corporate can provide you with those services to facilitate that deal on your behalf.

Darren Engle: 49:45

Then, moving beyond that, now that that asset has been acquired and now the owner is looking to place it under management, well, there's a deal structure that can be set, you know, put in place. So we would just like, where our focus is on our approved vendor program right now with air carriers, we could have something very similar from an under management perspective with operators that would want to have access to assets, and then we could be the medium connecting the agencies and agents with the operator in that case, their management firm in that case. But there's more than our platform as we continue to grow and expand the offerings product offerings so that our agencies can further monetize and grow their own agencies and their business beyond just charter, if they choose to do that. We're also building tools to provide more data, so we have an AI engine that is based on our document repository and all things Stratus Jets, as well as FAA, et cetera. Within the industry, we have a multitude of data acquisition engines that allow our agencies and their agents to have access to certain data sets that they can then generate market analysis and provide that to their clients so that they can make an informed buying decision. And it's things that are done dynamically. These aren't static things that we're working on, and so real-time pricing and availability and positioning and things of this nature are all happening as we speak, and so, with our focus being on our platform and being advocates for our agencies, once as we onboard agencies and they're focused on their clients, their relationships and booking flights, ours is on our systems, tools and people then you're going to see, I would say, over the next 10 years a complete at least from where I'm standing a complete shift in the industry.

Darren Engle: 52:00

From the demand side, the supply side, you have a lot of private equity money that has come in and bought assets but that doesn't necessarily translate into sales. I won't mention the companies, but you see their P&Ls and it's all red. So you know the PEs are used to, you know buying assets and financially using mechanisms to make that work, that model work. But in this industry just owning the assets doesn't mean that the people who want to fly will fly with you. It's all relationship driven and so you know Joel has mentioned a million times this isn't a commoditized business. You know this is a bespoke services business, right, and so you want to be able to provide that and that's all done relationally and we're just building the medium in which that will be facilitated.

Chris Glass: 52:58

Well, that's a fantastic answer. It sounds like the next 10 years are going to be very exciting for you two, gentlemen. We're looking forward to it. Now one last question before I go, for both of you. Joel, you kind of tipped your hat a little bit, but what is your choice of private aircraft that you'd like to fly or own yourself? What is your choice of?

Joel Thomas: 53:19

private aircraft that you'd like to fly or own yourself. Well, I mean, the PC-12 really fits my personal flying profile needs Just being able to take my family to the Bahamas or up to the Carolinas quickly, safely. The turbine reliability is awesome. So I really like the PC-12. I have about 15 hours in one now, but you know, gosh, if I could own any airplane, I really love the Challenger 3500 a lot, so that's a great aircraft.

Chris Glass: 53:45

Yeah and Darren, same question what are you flying?

Darren Engle: 53:48

I'm on the opposite end of that spectrum. I like warbirds, so anything with just raw power and with a high probability of death is extremely exhilarating and exciting for me personally. I don't have my own family as Joel does, obviously, so his mission objective is quite different. But I think keeping those old birds flying will require the next generation of pilots to come in, and you know I'm an aging asset myself, so you know I say that with the dreams and aspirations of getting flying more and more complex warbirds. But I think that over the next decade, you know, there needs to be younger pilots that just aren't pursuing aviation for professional means, right, because you know the passion for aviation is, I feel, in some ways dying out through the contraction of general aviation as a whole. And so you see a lot of, you know, if you're looking at these Cessnas and Pipers flying around, it's flight schools that are really just training pilots to become CFIs and CFIIs so they can get time to get 1,500 hours to be able to get a professional job. But they're flying on glass panels, they're not flying on steam gauges. There's just a difference, I think, and I would love to see, you know, a renewal in passion and see some movement where younger people are wanting to fly these older warbirds and so that they just don't go to the wayside.

Darren Engle: 55:30

You know, they're very from an engineering perspective and with me being a mechanical engineer, you know I geek out about these things but just looking into like old footage of these, these planes coming back with half intact wings and stabilizers, and it's just, it blows my mind how well engineered they were and especially given the era that they were built in, it's just phenomenal. I mean, even today, mechanically speaking. It's like you look at some of the Warbirds, you know they're like laminar constructed wings. We don't really have anything better, you know, from a piston perspective, that can go any faster. You know, I mean even the race planes that you see out in Reno and such are all old Warbirds, youbirds, furies and P-51 Mustangs and things of that nature, and they're just modified. But anyways, I digress.

Chris Glass: 56:29

So, Darren, you're more of a purist, is what I'm hearing more traditional guy when it comes to jets.

Darren Engle: 56:35

Yeah, I mean don't get me wrong, it's, it'd be really nice to have um, a tbm or you know pc12 and uh, you know it's, those are amazing aircraft, like turbine, I mean. I my I started my career designing and developing turbine engines, uh, gas turbine engines, so I have an affinity for that um. But yeah, that being said, it's just something that the visceral experience you get there's like the separation, it's like driving a modern car and then getting into, say, like I have a 66 Corvette and it's just a 327, four speed, munchie transmission, you know, carbureted, no electronics. There's an experience and a connection you get when operating that vehicle, and the same in airplanes that you just don't get in modern equipment. You know they're doing too many things for you. Not that it's not nice, don't get me wrong, but it's just you kind of almost lose sight or lose touch of that thing that really resonates with um, with people.

Chris Glass: 57:38

You know it's great to see both uh, joel and Darren, your passion uh for the industry that we all love, and I really appreciate you coming on the show today. Uh, I wanted to know, uh, if I'm interested in booking a flight or becoming a franchisee, where do I go for more information?

Joel Thomas: 57:57

Yeah, If you're interested in booking a flight. We have a number of franchises that are established and up and running that would be happy to help. There is a find an agency button on our website that can be navigated through the homepage link where you hover over franchise and it'll drop down to find an agency. If you're interested in establishing an agency and owning your own Jet Charter brokerage, click that franchise link. You can learn a lot more about it there and you can also submit a request to get in touch with us on that page. It's stratosjetscom forward slash franchise.

Chris Glass: 58:32

Thank you so much for being my guest today.

Joel Thomas: 58:35

Enjoyed the conversation. Thanks for having us, Chris.

Darren Engle: 58:37

Thanks, chris, really appreciate the time and the conversation.

Chris Glass: 58:40

And thank you for spending some time with us today on Open Skies as we learned more about Stratos. Gents, I'm your host, chris Glass, and we'll be back with more episodes shortly.