Tech Talk: Carpooling revs up

Updated February 16, 2020

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The engineer duo bets on the carpooling model, going where others have failed.
The engineer duo bets on the carpooling model, going where others have failed.

Over the past few years, mobility startups have become the undisputed drivers of the local ecosystem with all imaginable variants manning the space, be it ride-hailing, smart buses, car rentals (by the day or the hour). Now add to that mix a carpooling platform.

vCarpool is a Lahore-based startup that lets commuters find fellow travellers to share a journey together, while making (or potentially saving) a buck on the side. Whether it’s an outstation student wanting to go back home on the weekend or a professional with regular meetings in another city, the startup is looking to get them all.

Download the app, register using number, name etc and choose to either get a ride or offer one. If you go for the former, select the route (currently only between Lahore and Islamabad) and it will show you all the listed rides with information like the ad publisher, car, price, date, time, pick and drop points. Tap on it to find other specifics such as luggage size, smoking and book (it). The poster then gets a pop-up alert and can choose to accept or reject it. In case you want to offer a ride then add all those details and have your post listed.

The startup was founded in March 2018 by Junaid Lashari and Bilal Zahid, two engineers working in the telecom industry, and were then joined by Abeer Hamza to oversee operations and M. Abid for tech.

“All the telcos had centralised their operations from Islamabad, which meant people from other cities had to travel back and forth quite often. So in order to find travel partners, we created a WhatsApp group among our own network, which eventually expanded into four as more members were referred,” recalls Zahid. “During an entrepreneurship course at the Silicon Valley we finally realised the idea’s potential as a business and pivoted towards an app,” adds Lashari.

Carpooling industry has been around for a while, even before the more popular ride-hailing services, led by Uber, took off. The biggest player in the scene, Paris-headquartered BlaBlaCar, was founded in 2006 and has since attained a valuation of 1.4 billion euros with operations in around 20 countries.

But that’s Europe, a region where even hitchhiking with random people over long distances is possible. Here, security concerns dominate any mention of sharing a ride with strangers, and quite rightly so. So how does vCarpool plan to overcome an issue that falls well beyond its control?

“We started out with professionals for exactly this purpose and have tried to bring in some level of trust using associations with one’s organisation. For example if you work for Nokia, then there’s the option to add your verified company email address and have that name next to yours,” explains Lashari. There’s also the option to check a user’s profile, which is ranked according to its strength, that in turn depends on the level of information one has provided such as referrals, CNIC verified or not etc.

The issue becomes even more pronounced when it comes to women, a challenge the co-founders believe can be solved with more filters and additional restrictions, once enough join the platform. But without the checks and balances, they are also less likely to join. Kind of a chicken and egg problem.

This model has actually been tried in Pakistan as well, most notably by Rocket Internet’s Tripda but they were unable to pull it off in any geography and eventually shut shop. What made them unsuitable for this despite the resources (apart from its general methodology) but won’t be a hindrance for vCarpool? “They had extremely high operating expenditures from day one while we have stayed quite lean. Plus, we already had a recurring customer base (which is exactly the target market) before starting operations under this brand,” the co-founders say.

Even now, there is at least one similar-sized player (in terms of downloads) by the name of RideBNB, with a seemingly much more sophisticated and easy-on-the-eye app. But when it comes to rides, at least I couldn’t find any offer for the multiple dates and routes searched for.

The startup is bootstrapped for now and the co-founders have no plans to change anytime soon either. And how does vCarpool make money? Well, it doesn’t. Not yet, anyway. “We have kept it free for now but once there is a certain scale, there’d be a commission on the supply side just like Uber and Careem,” says Lashari.

On that note, this is not a business that has managed the kind of traction generally known to other mobility startups, barring a few exceptions and geographies. Given a relatively limited market size and a commission-based income stream, is the model even sustainable?

“We want to first tap on the intercity market such as industrial and educational zones outside the metropolises and then people commuting to and from suburban areas like Bahria Town or DHA,” says Lashari.

“We would also like to explore Gulf countries as well, especially high-frequency routes like Dubai-Abu Dhabi. Then there is the Swvl and Airlift-style intracity segment too. All of this makes up for a reasonable addressable market and should get us by well enough since our incremental costs are low too, once the product is refined enough,” concludes Zahid.

The writer is member of staff:

m.mutaherkhan@gmail.com

Twitter: @MutaherKhan

Published in Dawn, February 16th, 2020