The Department of Science and Innovation (DSI) has announced that it will help fund the development of an affordable, alternative internet solution for low-income…
With Uber waxing stronger and dominating the taxi tech space in Nigeria, tech startup founders are striving to find other opportunities within the sector. Considering the limited nature of the country’s on-demand-driving space, it perhaps explains why Uber continues to be the only significant player. But a startup has emerged and is striving to solve a different problem: hiring drivers.
In a chat with Ventureburn, Jonathan Ikpenu, a co-founder of FindADriver247.com, explains the company’s idea and unique strategy in a market that currently has one dominant player.
Ventureburn: What is your background in startups and tech?
Jonathan Ikpenu: I have no direct experience in owning or managing a startup prior to now. However, I have been actively involved in managing a number of successful subsistence businesses. Some of the company’s directors have some years of hands-on practical experience in managing a startup as they have worked with some of the leading e-commerce companies in Nigeria at top management levels.
VB: Why has the transport space seen so much attention in the tech world recently?
JI: There are a number of unique opportunities in this sector yet to be fully explored. Uber has only catered to just one aspect of the business which is basically to provide taxi services for individuals who might need such services using the app. People have to move from one location to another. Not everyone will be interested in using a taxi or can afford a taxi. Besides, charges these days are based on the number of hours spent on each trip.
And for a fact, we all know that Lagos and other major cities in the country suffer daily from traffic. So what that means is that people have to spend more on taxis if the traffic situation is bad. There are people who have vehicles but they only need someone to drive them if the cost is right and the social and security challenges associated with hiring a driver can be eliminated; meaning someone is taking responsibility for the drivers’ actions.
We created our platform to cater to this particular market with a unique proposition, that those who have vehicles can actually spend less hiring a driver compared to using a taxi service. A good example to illustrate this: it only costs ₦2500 to use any of our drivers for a full day (6am – 9pm). I do not know of any taxi service in the country right now that can charge you that amount for a full day’s work. Even when you add the cost of fuel, you’d still spend more on taxis.
VB: What is the story behind FindADriver247?
JI: FindADriver247.com was founded by one of the company’s directors. For us as a company, we have identified that there are two kinds of people who use taxi services: (1) those who do not have vehicles or have no access to vehicles; (2) those who have vehicles or have access to vehicles but do not want any form of driving stress yet cannot afford to employ a driver either because they don’t want to put anyone on a monthly salary (only need the services of a driver for a few days in a week or month plus cost), or it’s extremely difficult finding reliable or trustworthy individuals to employ (based on previous experience). We created this platform for the latter.
And to simplify this process, we have created different packages or subscription plans for individuals or corporate organisations to choose from. The rates vary; there’s no one size fits all. For the record, these drivers are our full-time employees. When customers place requests, we only deploy a driver who stays within the same location as the client. All our packages (subscription plans) are prepaid except for Corporate Packages. There is no exchange of cash between a client and our driver.
VB: Why do you think the industry needs this service now?
JI: As I mentioned earlier, our service is for those who own vehicles or at least have access to vehicles for navigating Lagos and its suburbs. However, for this category of people, security of their vehicles, among other things, is paramount to them. Often times, the traditional way of getting drivers is to speak to a friend or colleague or to an agent who would, in turn, go out scouting for individuals who can drive.
These supposed drivers, before they commence work, do not receive any formal driving training, do not have the authenticity of their driver’s licenses checked, do not provide guarantors in case of theft or misbehaviour, do not have any form of training on customer management, and cannot be replaced during emergency situations. Also, this set of drivers are only available for a monthly job (steady flow of income); they are not open to getting paid for just the days they work. Worse still, the agents do not take responsibility for whatever happens between the driver and the client.
So we set out to eliminate all of these challenges and provide the most affordable rates for people to hire drivers. With our drivers, we take full responsibility for whatever damage they cause to clients’ vehicles.
VB: What was the product development process like?
JI: We have been working on this since January 2016. There are two platforms created: FindADriver247 and 247housekeeping. The latter, just like the former, solves the challenges associated with hiring domestic workers (house-helps). The two platforms were developed concurrently and were meant to be launched together. However, due to some technical challenges, we decided to step down the housekeeping platform until the first quarter of 2017.
It was quite challenging developing packages and processes to make this work; a lot of thinking and unthinking. We needed to do a lot of research to understand the needs of individuals and corporate organisations, and see how we can adequately develop a solution that will address these needs. For instance, initially we only developed a package for daily and monthly hire. We later discovered that there are a lot of people who would like to go on inter-state trips (from Lagos to other states) and would need drivers to make the journey less stressful. Also, there are people who need drivers to take their family or parents to the village (and back). These people might not need drivers daily or monthly.
We took into consideration the needs of the night crawlers – those who shuttle Lagos clubs and bars. This set of people usually will pay for a taxi to the club for a drop off and hail another taxi back home in the morning. So we created the Nightlife package, looked at how much they spend (on average) on a taxi, and pegged our rate at something very affordable while the driver stays with the customer for the entire night (9pm- 6am).
We are currently in the process of developing our mobile app to simplify customers’ experience. Hopefully, before the end of the first quarter in 2017, this should be ready.
VB: It’s been said that you decided to pivot into hiring drivers so that you wouldn’t have to directly compete with Uber. Is this true? Why do you think what you are doing is much better than what Uber and Afro are doing?
JI: Competition is good for business. The market is also very large. There is no basis for comparison; these two companies are doing well for their customers. We have only carved a market out of the transport business; we believe there’s a huge potential in this market. The responses we have received so far in terms of patronage have proven to us that a lot of vehicle owners will prefer to be driven in the comfort of their vehicles, if (1) the price for hiring a driver is extremely good (2) someone is taking responsibility for the drivers’ wrongdoings (in this case we are); (3) there’s an option to request for a replacement at no cost; (4) the drivers are trained and attend refresher courses (of course this is mandatory before any driver is deployed).
So Uber is providing taxis for people to use but we are providing drivers for people to hire at an extremely lower rate (sic) compared to the cost of using a taxi with a far more superior customer experience.
VB: Since you launched, up until now, what has the experience been like?
JI: The market welcomed us with open arms. More and more people visit our platform everyday and 75% of these visitors translate to sales for us. So, we’re super happy with the progress so far even though we still need more and more people to try us out.
VB: The tech ecosystem is rapidly expanding and it begs the question — do you think you have adequate support and investment to actively compete in the market?
JI: There’s never enough investment to compete in any market. As much as we need capital to run the business successfully, making the product work and ensuring our customers are happy are the two most important focus areas for us now. 70% of our current client base are returning customers. So this means they are happy with us. The feedback we get on each driver has been very good too. Not a single one of them has scored below 70% based on clients’ ratings. We’re definitely interested in welcoming investors as long as the terms are good for both parties.
VB: Who have you identified as your biggest competition, what edge do you have over them?
JI: With all sense of modesty, we don’t see any direct competition for now. The taxi app companies are not directly our competitors. Some of the vehicle owners on these platforms have approached us to hire some of our drivers. We’re currently in talks to sort out the terms, and once both parties align, we’re good to go. Our biggest edge is our pricing; it’s difficult to find something cheaper than what we currently offer.
VB: What is your major source of investment?
JI: Angel investors. They are still the lifeblood of the business until we find venture capitalists who are willing to key into our vision.
VB: What is the big picture and vision for the company?
JI: We want to take our services to major African countries. But first charity begins at home. So apart from Lagos, we’re expanding to Abuja & Port Harcourt in 2017.
VB: What is your approach towards achieving these big goals?
JI: For the kind of business we do, hiring the right people is key. Our people (employees) are our greatest assets. Once anything goes wrong with the quality of employees, the entire ecosystem of our business will be affected. And that’s why we have put in place a very stringent recruitment process. If you successfully pass through all the stages, then you’re the candidate we’re looking for. To allow for a more objective scrutiny, we outsourced the recruitment and verification of our drivers to an independent agency because recruitment is not our core competence.
VB: What is your team like?
JI: We have a very small team. Big things, they say, start small. We have various units: customer support, revenue management, dispute & settlement, business development/sales, finance, and deployment unit. There’s a board of director made up of four directors, and a team of eight employees.