Airlines invest in technology startup to prevent booting passengers from overbooked flights

Following the ugly case of David Dao, the Kentucky doctor who was dragged from an overbooked United Airlines flight, the U.S. airline industry vowed to fix the problem of oversold planes.

Now some airlines seem to be backing up their promises with money.

The parent company of British Airways and the venture arms for JetBlue and Qantas recently offered $2.6 million in financing to an Atlanta-based start-up that has created software designed to end the drama and frustration that comes from overbooked flights.

Volantio has created software that contacts passengers via a mobile device days prior to their flight to ask if they would be willing to accept offers of upgrades, vouchers and frequent-flier points to give up their seat in the case of overbooking.

If the airlines need to unseat a passenger, the software automatically contacts those passengers willing to give up their seats and re-books them on a later flight.

Volantio’s software is already in use by Qantas, Iberia, Alaska Airlines and Volaris and several other carriers.

“We view the funding as a strong vote of confidence that we are on the right track with what we are building, and that the industry believes we have a leading solution,” said Azim Barodawala, chief executive officer of Volantio.

Among the latest investors in Volantio are the International Airlines Group, the parent company of Aer Lingus, British Airways, Iberia and Vueling. Also offering financing is Qantas Ventures, the venture capital arm of the flag carrier of Australia, Qantas and JetBlue Technology — whose New Yorkbased parent JetBlue has a training facility at Orlando International Airport, which lists 455 weekly flights for the airline.

The rate of passengers involuntarily booted from planes had dropped dramatically since the Dao incident, as some airlines have changed policies and increased the amount they will offer to get fliers to voluntarily give up their seats to as much as $10,000.