Research from Lufthansa Innovation Hub showed that airline investment in startups hit a five-year low in 2025. But as the aviation industry feels the impact of rising fuel prices, artificial intelligence, and advanced air mobility (AAM), making these investments remains essential.

UP.Labs operate venture labs across eight different verticals, including aviation. They want to help airlines overcome legacy constraints and move faster on innovation. Stefan Teulon, the company’s President of Aviation Ventures, says his mission is to help bridge these gaps and foster a more collaborative environment with aviation startups:

An airline’s DNA is to move with intentionality, and that can lead to slowness. Airlines know their problems, and they probably have the solutions in their mind. But there’s a gap before bringing it to reality.

Among UP.Labs’ partners are Alaska Airlines, where they’ve managed to act with impressive speed. Together, they’ve incubated three AI companies in a year, with a fourth in stealth mode. Teulon says the secret to scaling so fast is all in the mindset:

W’ve been able to bring a startup mentality to the rigor and depth of Alaska’s problems, to build a solution that has product market fit from day one.

The rate of change in tech moves so fast that airlines often struggle to keep pace. Teulon’s team want to build viable, long-term solutions that can have an immediate impact on operations. Succeeding the buzz surrounding AI chatbots, Teulon believes agentic AI is the next transformation that will reshape how airlines work.

The startups that we’ve built are AI-native. They are built with an agentic-first approach, so this gives us an edge in terms of the solutions that we brought to market.

🎥 Watch the video for the full interview with Stefan Teulon.

Questions asked include:

  • What’s holding airlines back from turning innovation into real operational results — and how is that shaping where the industry is investing?
  • You’ve built three AI companies with Alaska in three years, with a fourth underway. How did you move that fast — and what does the model unlock that traditional innovation doesn’t?
  • Looking ahead, where’s the biggest opportunity for AI in airline operations — and what are you most excited to build next?

Join us at World Aviation Festival 2026 and explore our Startup Village.

For more like this, see: