Less than a year after launching, Richard Branson’s Miami-based premium cruise line Virgin Voyages announced on Wednesday that it has closed on $550 million in new funding from the investment management firm BlackRock, with additional support from its existing joint-venture partners Virgin Group and Bain Capital Private Equity as well as other backers.
The new funding will enable the fledgling cruise line to execute on its growth strategy as demand for cruising gains momentum and the industry loosens Covid-19 pandemic restrictions, the company said in a statement.
“We have created an incredible product that both our investors and consumers truly believe in, and this additional capital comes at a time when we’re looking forward to exponential growth that will, in turn, help us achieve what we set out to accomplish,” said Virgin Voyages CEO Tom McAlpin, a seasoned cruise executive whose long career includes stints as chief financial officer and president of Disney Cruise Line and as chief executive at The World, a private residential cruise ship operated like a condo complex, with spacious staterooms that can be purchased.
In a very short time, Virgin Voyages has made quite a splash in the cruise industry with its adults-only, no-buffet sailings and steep-but-inclusive pricing that includes table-service dining, Wi-Fi and fitness classes — amenities that all but a few luxury cruise lines charge extra for.
“Virgin Voyages has successfully launched a new brand in the cruise industry and proven its appeal to both the traditional and non-traditional cruiser, allowing the brand to tap into new markets and re-imagine this travel category,” said Ryan Cotton, a managing director at Bain Capital.
Since its launch in August 2021, Virgin Voyages’ two 2,700-passenger ships — Scarlet Lady, sailing in the Caribbean, and Valiant Lady, which plies the Mediterranean — have snagged Cruise Critic’s “Best New Cruise Ship” title, landed on Condé Nast Traveler’s 2022 Cruising “Hot List,” and were named a top ocean cruise line in Travel + Leisure’s World’s Best Awards.
“Despite the unprecedented challenges the cruise sector has faced in the past few years, the industry is exhibiting a powerful rebound,” said Brendan Galloway, director in BlackRock Global Credit.
He’s right about that. Cruising, which was decimated during the first two years of the pandemic, has been firing on all cylinders. This year, passenger volume will hit 95% of 2019 volume, and is expected to surpass pre-pandemic levels in 2023, according to an annual industry report from Cruise Lines International Association.
Last month, Virgin Voyages became the first cruise line to stop requiring passengers to get tested before embarking on a sailing, though it still requires 90% of passengers and all of its crew members to be vaccinated.
Virgin will soon double its fleet with two more ships — Resilient Lady and Brilliant Lady — debuting in 2023.