We were interviewed in the July 2016 issue of PHC Magazine: www.phcmag.com
Briefly explain what Cab Guru is?
Cab Guru is a comparison app which allows users to easily compare local cab companies near them and then book one for a fixed price. Users can choose to book ASAP or pre-book and they can pay by cash or card.
However, Cab Guru has another mission. It is a platform offered by cab companies for creating true partnership and shareholding for the benefit of the cab industry.
It is early days yet but we have much bigger plans to bring as much unity and collaboration to the industry as possible by introducing some novel technologies which make it far more than just an app.
Whose idea was it?
A group of cab company operators were looking for a way to compete against Uber and other cab app disruptors. They decided that by working together in collaboration with one another, they stood a better chance of succeeding.
Individually, they all had their own apps and marketing efforts. However, to compete against Uber and others seemed like a challenge of gargantuan proportions and would need an endless supply of marketing budget.
If you don’t have the money, then you better have damn good ideas to make you more than just another app provider. If anyone can bring unity to this fragmented industry, then you have something unique. Say hello to Cab Guru.
From start to finish (and we appreciate that it is an on-going process) how long did it take to develop and what were the biggest challenges in getting the app done?
The app was developed in three months. It was based on an existing well established app and technology which involved over five years of developmental work.
The biggest challenges we faced were catering for the individual operating practices of cab companies ‒ for example, the individual pricing structures and operating areas.
The most exciting part of the development work is that it is an ongoing process. We have a pipeline of features and functionality which we are very excited to be working on.
Why did you feel there was a need in the marketplace for the Cab Guru aggregator app, given that you already offered APIs to other booking platforms/apps, such as Kabbee, which allowed them access to the Cordic system?
Cab Guru is an aggregator funded and operated by the cab companies for the benefit of the cab industry. This is a step towards cab companies working with one another – true collaboration.
How is Cab Guru different to other cab apps?
Cab Guru is different in that we are:
- UK based
- Owned and led by the cab companies
- The first platform/aggregator to have brought unity to the industry
In terms of finance, we are obviously aiming to have a sustainable and profitable business but there’s no pressure or demand from financial institutes for a quick high return on investment which in turn means we’re not squeezing prices, or putting pressure on operators or drivers for quick profit.
We have the best and most experienced technology provider as a partner. To the best of our knowledge this unity in the industry has never happened before. We know it will take time for us to build and gain trust with the operators, but this is just the beginning of our journey.
Since the ‘soft-launch’ in December 2015, how many operators have taken up the option of partnering with you?
We currently have just over 150 operators on board as Cab Guru partners and we aim to have over 300 signed up by the end of 2016.
What percentage of each fare do you charge the operator?
There is no cost to sign up, it’s completely free and we don’t have any contracts to tie cab companies in. We charge the operator 10 per cent of each fare they receive through the app.
Is this fixed for any period and is it likely to change?
All charges are agreed by the directors of Cab Guru; the majority of which are cab company owners. Their aim is to reduce this rate to as low as possible over time.
Possibly the biggest single opposition to cab comparison apps/sites is the assertion that they promote the so-called ‘race to the bottom’. As Cab Guru is only currently available to users of the Cordic despatch system, would a common local area pricing structure based on performance (i.e.: closest vehicle, customer rating etc) rather than cost comparison, have negated any suggestion that it too is just another ‘stack em high sell em cheap’ service that devalues the work done by cab drivers?
On the surface it appears that price comparison is a race to the bottom, but this is not beneficial to any operator or driver. In practice we have observed that consumer needs favour high availability of vehicles and quality of service over low prices.
Using intelligent technology and high availability of vehicles, reduced dead mileage can be achieved which is beneficial to the bottom line earnings of drivers.
Back in March this year when you fully launched the service, you reported that the aim was to have 50,000 taxis and private hire vehicles available on the app. Given that it is only three months since you made that statement, how many vehicles are currently on the system and do you think you will achieve the original target?
We are well above our target to achieve these numbers.
Currently we have availability in over 60 UK towns and cities and have over 15,000 vehicles in London and over 18,000 vehicles outside of London, which is the fastest ever growth for a cab booking app in the UK.
We can boast availability in more towns and cities in the UK than any other cab app in the market. This growth is down to the support and belief of the cab companies behind Cab Guru. We are receiving hundreds of requests from passenger car services all over the UK wishing to join the partner network and our onboarding team are adding fleets each week.
It was widely reported that you raised £2million of initial funding to kick-start the project. In comparison to others in the market place this is not a huge sum. What have those funds been invested in and will you be looking for another round of investment in the near further?
From the outset we realised that just over £2million in available funds is a fraction in comparison to some of the other cab apps out there. The true force behind Cab Guru is the participation and collaboration of each of the Cab Guru partners and shareholders. Let’s not underestimate the role of good technology for success in this sector. Many app providers consider themselves more as technology companies. So what’s better than to involve the people who were the first in the world to introduce cab despatching via smartphones.
The involvement of such a team has been critical to Cab Guru’s success.
We are investing the funds in marketing and further app development. We are working smartly with our budget and are making each penny work well for us.
With regards to any future funding, this would depend on the participating cab companies which hold the majority of shares in Cab Guru. There is no doubt that the existing infrastructure achieved in less than a year has put Cab Guru in a very strong position for further funding if it is required.
Would you consider external/non-Cordic operators to invest?
Currently, there is no requirement for further funding but this would be a decision which all the participating cab companies would need to make for the benefit and success of Cab Guru and creating unity within the industry itself.
Whilst we fully appreciate that Cab Guru and Cordic are independent companies, access to Cab Guru is currently limited to Cordic users. Do you envisage the system eventually being opened to cab operators utilising other despatch systems?
One of the key elements of Cab Guru’s success which was fundamental in obtaining investment was the technology aspect. Rather than re-inventing the wheel, partnering with a market leader to provide the technology behind the app has been key to Cab Guru’s success.
With regards to non-Cordic despatch systems, yes – Cab Guru wishes to integrate with them ASAP.
You have the booking and despatch capabilities in Cordic and now (albeit independent) a nationwide comparison app. With this in mind, some might suggest that the next stop could be to invest in your own cab company/fleet. Would this ever be considered? And if so, why/why not?
It does not make sense to invest in a cab company. The IP of Cab Guru’s app technology belongs to Cab Guru Limited and the majority of its shareholders are cab operators. In the shareholder agreement we stated that obtaining an operator’s license would not be allowed. It’s not what the shareholders wish to do. The structure of this company is different to any other aggregators in the market.
Given the rapidly changing face of the cab trade, where do you envisage the company being in 18 months’ time?
In 18 months’ time, we’d like to be the largest aggregator of cabs in the UK and continue to bring more unity to the industry through building trust and introducing some very innovative technology as well as the app.
We want to stop the race to the bottom and work with cab companies to drive up standards and service which will help drivers earn a decent living.
Experience in running cab companies helps us achieve our objectives. We want to attract the drivers, who left the cab companies in favour of Uber, back and help the existing UK local cab companies thrive once again.
Our partners are already seeing the benefits. One owner has recruited 12 new drivers since they went live with Cab Guru in their operating area a few months back and another has had eight new drivers sign up in one week!
As we said previously, we are aiming to have a sustainable and profitable business but there is no pressure or demand from financial institutes for a quick high return on investment.
We also have the best and most experienced technology provider as a partner. To the best of our knowledge, such unity has never happened in the industry before. We know it will take time for us to build and gain trust with the operators, but this is just the beginning of our journey.