“One per cent a day”: How Neel Khokhani started Australia’s biggest flight school with just $5,000 in savings
At just 22 years old, Neel Khokhani launched Soar Aviation, a flight school that today boasts revenues in excess of $12 million.
At the age of 22, Neel Khokhani was sacked from his job as a flight instructor after giving his boss some suggestions on how he might improve the business, told that if he thought he knew so much about business, he should just do it himself.
That boss may regret those words, as Khokhani’s Soar Aviation is now Australia’s largest flight training school, with revenues in excess of $12 million and over 500 students across the country.
But as you might expect, starting a flight school isn’t cheap, and a 22-year-old founder with just $5,000 in savings is a fair way off buying a $100,000 light aircraft, and even further off getting customers to fly in it.
“I decided to crowdfund the aircraft purchase by pre-selling flying lessons at a highly discounted rate. I came up with a big database of customers, and really quickly it became a big hit,” he tells SmartCompany.
“On the first day of business, I did $180,000 in revenue. I took that money, bought an aircraft, and flew it down to Melbourne and immediately started servicing customers.”
That led to the foundation of Soar Aviation, with many of those one-time customers coming back for repeat lessons, allowing Khokhani to build out his fleet of light aircraft, which today number at nearly 60.
In the last three years, the business has soared, pulling in a growth rate of 587% and increasing revenues by nearly $10 million, landing the company in the number two spot in 2018’s Smart50 Awards.
The company takes a different approach to flight training which has led to an influx of students, choosing to offer customers evening theory lessons and weekend practical lessons through a partnership with Box Hill Institute TAFE, rather than the weekday 9-5 lessons other flight schools offer.
“We’re servicing those customers with full-time jobs who can’t do Monday to Friday lessons, and that’s had incredible uptake,” he says.
Soar Aviation celebrated its 30th commercial pilot graduate just the other week, and Khokhani boasts a graduate of theirs recently landed a job with American airline giant Delta.
Growth not all it’s cracked up to be
Having recently launched in Sydney, the founder believes the business’ growth will continue to take off, forecasting another year of increasing revenues for 2019.
However, increasing revenue by nearly $10 million in one year is no easy feat, and Khokhani says he’s struggled to keep up with the pace of the business across many different facets.
“Going from $3 million to $12 million — 300 per cent growth — that’s nearly a per cent a day. If you go for a three week holiday, you come back and the business has completely changed,” he says.
“You pick new processes to implement, but they’re outdated by the time you finish implementing them. It’s really posed a lot of challenges.”
Khokhani has also learnt some hard truths about hiring staff during times of intense scaling, saying a person you hire to work at a $3 million business is vastly different to the sort of person you hire to work at a $12 million business.
“But what do you do? They were doing a great job when the business was small, but now they’ve got all these other responsibilities to consider,” he says.
Thankfully, midway through 2018, Soar received a helping hand after 50% of the business was sold to private equity firm The Growth Fund, who, as the name suggests, are used to working with fast-growing businesses.
“Their experience has helped me tremendously, the business is pretty stable now. We’re not gunning for more outrageous growth, we’re just focusing on being high-quality and improving our customer experience,” he says.
Regulatory headaches
Soar’s business model is one inherently fraught with risks and regulation, as flight schools in Australia are required to jump through significant regulatory hoops to become registered and recognised.
Khokhani says his business is hamstrung by red tape more so than others, as its positioning as both an aviation business and a training organisation requires it to be registered as an RTO by the Australian Skills Quality Authority, along with the numerous required aviation-related requirements.
But the founder doesn’t take the view that Soar is a difficult business to run, instead believing these regulations form a “moat” around the business which keeps competitors away.
“It means competitors can’t just walk in and disrupt your business model, it’s a blessing and a curse. I don’t find it particularly challenging,” he says.
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