In the fiercely competitive private aviation sector, Vista, the world's leading global business aviation company, through its market-leading brands VistaJet and XO, has carved out a distinct niche by building a scalable, global business grounded in contractual cash flow. This business model ensures predictable revenue, while also offering resilience during times of volatility—a quality that proved essential during the Covid-19 pandemic and continues to do so throughout times of economic uncertainty.
But this resilience also comes from a drive to innovate—both in terms of product and financing. As the industry grows and presents broader opportunity, Vista’s Group Chief Financial Officer (CFO), Charlotte Colhoun, knows that this drive to innovate is critical in cementing Vista’s spot as the go-to provider of private flying, both in established and emerging markets.
Colhoun’s passion for the industry is clear. She joined the industry when she joined Vista as a director in 2018. After extensive involvement in the firm’s acquisitions and investments, she was made Chief Investment Officer in 2021 and Group CFO in 2022, a role she is relishing with all the challenges it brings.
“It's a big job, it's a hard job, but it's rewarding and I enjoy it,” Colhoun tells Airline Economics. “I enjoy the challenges and opportunities and the dynamic industry that we operate in.”
Colhoun started her career at PwC working on mergers and acquisitions for financial companies. She notes that she wasn’t aware of the aviation industry, and, moreover, the sheer size of it until she was in it. But it wasn’t the industry itself that initially pulled her in, it was Vista.
“I didn’t come into this industry as an ‘aviation person’—it was Vista that drew me in,” she says. “After being approached about a job at Vista, I met the people I'd be working with, did some research on the company, and felt that if I was ever going to leave PwC, which I loved, it would have to be for an interesting business that's fast paced with a lot of opportunities. And Vista ticked those boxes.”
Soon after joining Vista, Colhoun attended her fist industry conference and realised that the industry was “huge”. This triggered a connection with the sector that remains, something that Colhoun says resonates across the industry.
“Once you’re in aviation, it’s hard to leave,” she says. “It’s an industry that somehow breeds a huge stickiness amongst the employee base. There are a lot of experts who are extremely passionate about it.”
Covid effect
Like so many in the industry, Colhoun’s lived experience of the aviation sector during the Covid-19 pandemic has given her a unique perspective on how the industry as a whole has evolved over the last five years. For the private aviation sector specifically, Covid brought opportunity that Vista has been able to capitalise on, in particular during periods of economic uncertainty.
Colhoun explains that as commercial airlines and regional private operators pulled flights and left the skies empty during Covid, Vista, through its market-leading brands VistaJet and XO, was able to provide flight options to a new customer base of essential travellers who were struggling to find commercial options. This enabled the company to build loyalty among clients—a loyalty that is essential in times of economic volatility.
“During Covid, business aviation really demonstrated itself as an essential tool for global travel… The commercial airlines weren't readily available, and for those who needed to fly for essential purposes, it was really hard to do so.
“Business aviation, and, specifically, VistaJet, were very much present and available, so during that time, we built a strong loyalty amongst our client base, which means that now, as we find ourselves in a slightly more challenging economic climate, people are more inclined to stand up to the board and defend why they need to retain their contract with us or keep their aircraft or whatever it may be, because Covid really demonstrated the essentiality of this service.”
Opportunity abounds
The changing face of the market in a post-Covid world means that there is significant opportunity to be found. Colhoun notes that VistaJet has an approximately five percent of total market share, with there being as many as 24,000 underutilised business jets in the market. With the majority of these 24,000 jets remains owned by individuals or flight departments of corporations, this presents significant opportunity, she explains.
“We are targeting the flight departments of corporations, because the reality is, if you own an aircraft, your aircraft isn't available 365, days a year. So we can secure clients even if they own their own aircraft. Once they experience our service, it’s then our job to expand our share of wallet with them as we deliver on our service.”
She gives the example of an organisation that may have the functionality to handle private trips within the US, but needs a different solution for international travel. “They may have a 50-hour contract with us for that type of flying. And then, over time, we want to try and get more and more of their flying. So there is a huge market opportunity.”
She adds that Covid accelerated this shift away from asset ownership, which she describes as a “longer-term shift” that we are witnessing across a wide variety of industries.
“People no longer want to own these assets —a depreciating asset that you have to maintain, that you have to hire your own pilot for. These are complexities of asset ownership people don't want to have anymore. They want a simple solution that is predictable in terms of costs, so the market opportunity for Vista is clear.”
Of course, if the opportunity is there for Vista, then it is there for others. Colhoun knows only too well that if Vista is going to take advantage of the huge opportunity the sector presents, the firm needs to innovate to stay ahead.
“Covid certainly paved the way for a lot of innovation in the sector, which means we continue to have a lot of new companies popping up trying to compete. And this is an industry with plenty of space for competition, but a key challenge is being able to scale effectively. This is where VistaJet has a unique advantage because of our global presence and guaranteed availability.”
She notes that, along with scale, one of the most difficult aspects of the industry for new players to try and replicate is the operational experience existing players have.
“Our knowledge of getting in and out of nearly any airport around the world, arranging permits, arranging catering, arranging transportation, and so on. These are not things that exist in a central database, they are elements we have built over time, and that’s what’s really hard for a competitor to replicate.”
Financial innovation
One of the challenges Vista faces when meeting with banks and investors is ensuring it doesn’t end up in a traditional investment silo that doesn’t serve its financial strategies. Colhoun explains that it can sometimes be a challenge to explain that Vista doesn’t necessarily occupy only one space.
“Banks like to put you in a box - ultimately, we’re aviation and we own aircraft too so, you can look to the wider transportation industry. Then you look at our client base and it’s probably the ultimate in terms of a luxury clientele, with a subscription business model. So we don’t fit neatly into one category – we have used this to our advantage to take learnings from these sectors to access diversified sources of capital and financing structure..”
She explains that as Vista has gone through this process, the company has evolved the type of capital it uses in order to support its unique operating model.
“If I go back to our original fleet investment phase, when we were going from 40 aircraft to 73 aircraft, that was largely done with a lot of the Chinese leasing community that many commercial airlines used via products such as bilateral loans and leases. Over time, we’ve evolved into more sophisticated, institutional-type capital including access to the unsecured bond and loan markets.”
Through Colhoun’s tenure at Vista, the company has launched a EETC Program, with its inaugural issuance in 2020. The first solely business jet EETC and the first Maltese law EETC. The deal was awarded the Airline Economics Aviation 100 European Editor’s Deal of the Year in 2021. This followed by two further notes series. Colhoun has executed on three unsecured bond issuances, raising $2bn over three separate financings. Already this year, Colhoun raised a further $1.3bn across new loans and equity issuances. Each transaction highlights the continued evolution of innovation within Vista’s financing structures.
Colhoun says that these financial innovations mean Vista can now focus on executing and driving growth, which will allow for credit enhancements as the firm reduces its leverage, enhances free cashflow and, in turn, drives up credit metrics.
“That's a core part of our financial policy,” she tells Airline Economics. “That focus on prudent financial execution.”
This prudence extends to the conversation concerning financial risk management in private aviation. Colhoun notes that 75 percent of Vista’s debt is fixed, with the firm’s largest bond maturing in 2030 at sub-6.5 percent. “That stability protects us in volatile markets,” she points out.
In explaining Vista’s risk management posture, Colhoun notes that FX interest rates and fuel are two key areas of exposure. When it comes to FX, aviation is predominantly US dollars and Euros, so Vista has limited exposure, she says. And when it comes to fuel, Vista contracts have a pass-through mechanism for fuel costs, providing the firm protection from fluctuations in fuel price. Colhoun explains that this “natural hedging” management is preferential because it generally avoids the risk and potential expense that comes with hedging.
“Hedging can be really expensive and complicated to get out of if you need to,” she says. “So I prefer to find ways to manage it naturally through a business model, FX, or naturally hedging some of your revenue with your own costs.”
Sustainability efforts
Like others in the industry, Vista is focused on sustainability, along with environmental, social and governance (ESG) efforts. With a business model that by its very makeup offers sustainability advantages, Colhoun says that the scale and efficiencies in the model are key to the firm’s sustainability efforts. Colhoun shares with Airline Economics: “VistaJet has set an ambitious target to transition towards the use of SAF across its fleet and has already secured large volumes of SAF on behalf of its clients, having contracted 4.2 million US gallons to date.”
“The use of SAF reduces the total lifecycle carbon emissions on average by 80% as compared to conventional jet fuel and is considered the key route to decarbonizing the aviation industry in the near future.”
Women in leadership
When it comes to being a woman in a leadership position in the aviation sector, Colhoun sees exciting opportunity. She tells Airline Economics that she sees success in always being “willing to put my hand up and get involved”, creating a continual learning cycle for herself, regardless of gender.
“I don’t view my gender as a challenge—I see it as an opportunity. When you’re the only woman in the room, you often bring a unique perspective,” she says.
In fact, for Colhoun, career advice remains the same regardless of gender. She suggests, being intellectually curious, pushing yourself outside of your comfort zone, and taking on challenges.
“As long as you're learning, gender is irrelevant—you will continue to evolve whether it goes well or it doesn't,” she notes, adding that if anything, being a woman in the aviation sector has given her “more of an opportunity to differentiate myself by having a slightly different viewpoint and different perspective.”
Looking ahead
In terms of the future, Colhoun is clear that growing Vista’s five percent market share is firmly in her sights. She notes that current market opportunity is global, with emerging markets representing exciting potential for growth. “We have global scale, but there’s still so much blank space,” she notes. “As emerging markets like India and Africa grow, we’re in a prime position to expand.”
The goal, she says, is to become the go-to name for flying privately in emerging regions by continued investment in service quality, fleet expansion, and innovative financial strategies.
This, combined with the push for growth globally, are what’s next for Vista. And Colhoun’s passion for bridging financial strategy with operational effectiveness, along with her commitment to sustainable growth, make Vista well positioned to achieve this goal.
As Colhoun puts it, “I think there's just a huge opportunity in the private aviation market, and we will continue to learn and innovate and develop; there's a lot more to come.”