EziDrive’s story, or how to scale a startup without VC help

A month ago, I was meeting some friends for lunch. It was a weekend, and food orders somehow quickly morphed into beer orders. I had taken my car, so I was quietly focusing on my starters, when a friend caught on and offered a suggestion.

“If you are not drinking because you are worried about the car, why don’t you book an EziDrive?”

Gingerly, I fired up the website on my phone, and was given a confirmed booking within minutes. Whatever apprehensions I had were swept away when the driver personally called to confirm that he was coming, even apologizing for a potential 15 minute delay due to traffic. If you’re in an Indian city, you’ll know that a delay of 15 minutes is not considered a delay by almost anybody, and rarely have I seen anyone ever apologize for it.

The value proposition is different from an Uber, or Ola.

The driver came on time and found me inside the restaurant we were at. He confirmed we were the right booking, showed me his driver ID, took the car keys, drove us back home, parked the car, and then left with the US$4 I owed him.

That experience was so smooth, I tried EziDrive again a few days later, and got an even smoother driving experience.

Bangalore-based EziDrive was launched in 2008 to help people with cars stuck at various places in the city, founder and managing director Ram Prasath tells me. Like with me, its user base is almost exclusively generated by word-of-mouth publicity.

Photo credit: damedeeso / 123RF.

Ram is an anomaly in the world of tech startups today. He has an MBA degree, but no school pedigree to boast of. He doesn’t have VC backing either. The seed money came from his own savings.

“I was going through the same requirements that I serve today. I had to travel a lot and I didn’t always want to hire a car. Sometimes my family had to travel, and we needed a driver,” he says.

“So I launched the company as a hobby. Then as it started gaining grounds, I put IT systems and processes in place, formalized driver requirements and built a team,” says Ram.

The company now has 85,000 users and 750 drivers on board. This year, EziDrive is expecting to make US$293,621 in revenue. At the core is a twenty-member team that works from Bangalore. So far, EziDrive has booked about 1.5 million rides, says Ram.

The company has 85,000 users and 750 drivers on board.

“We are operationally profitable, but we don’t make much in net profits because whatever excess cash flow we generate is now being reinvested for software upgrades,” he says.

But if the barrier for entry was low for him, what is stopping others from replicating the business?

Two things. Firstly, the low barrier in 2008 isn’t necessarily low anymore, given how times have changed. “Everything we have done, our IT upgrades, have been a reflection of customer demands. Now I know exactly what my customer wants. For anyone to build this system now, they have to spend that much time to do it right,” Ram says.

Secondly, training drivers who aren’t officially employees of the company, and ensuring they keep standards from falling is a major effort that makes a lot of startups (and VCs) think a people-driven business is too risky.

Uber, Ola, and barriers

Ram’s company doesn’t employ drivers. Instead, it partners with them. Drivers pay the company anything between US$22 to US$30 each month as commission.

On average, EziDrive’s clocking just under 1000 bookings across its services each day, he said. In 2014, the company launched cab hiring services, but that accounts for less than 20 percent of the business.

But isn’t it hard to keep this business up in a world that has tasted Uber?

“The value proposition is different,” Ram says. “Uber and Ola are fighting against each other over costs. Each one is trying to be the cheapest, and that’s how they are building their customer base. We don’t do cheapest. Our customers come to us because they like our service, we don’t even spend money on marketing, simply because we don’t have that money to spend.”

The EziDrive team. founder Ram is fourth from right. Photo credit: EziDrive.

Customers who need to make multiple stops – like a mom who wants to go shopping for the day – hire EziDrive, he explains. Those who need regular pickups and drop-offs to the office and airport will also opt for the startup’s service.

When Ram thought of the company, on-demand taxis were not popular, and his business didn’t have a high barrier to entry. At the time, Ram says all he needed was a few dependable drivers and a person to man the phone line.

But as demand started growing, so did needs. In 2010, the company set up a system to track customer details, as well as driver details for safety and convenience. EziDrive started taking on more drivers via registration.

“Satisfaction was high, and the same customers started calling us again and again. Which means we had to share their numbers with our drivers,” Ram explains.

From there, the company went on to launch an app for its driver partners. The customer app is in beta, to be rolled out by February. After the app it functional, Ram wants to expand business to Delhi and Hyderabad. EziDrive launched in Chennai in 2012.

The training rigor

Not unaware of the challenges of running a people-based startup, Ram says the EziDrive team has put in numerous checks in place.

“The biggest problem we see is that we as a company need to have a hold on the driver – something that ensures reliability. When it’s a small company, maybe no one bothers. But now people have come to trust us, and that is the biggest challenge, to make sure each and every driver we deploy is well-mannered, and holds himself to the quality standards that we promise to our customers,” he says.

Photo credit: Central Western Daily

EziDrive says it takes in drivers who have at least three years of experience, runs background checks on them, and asks them to submit various documents with the company.

If the background checks don’t work out, the driver is not recruited. If it does, the driver is then asked to go through an induction, where trainers and videos walk them through the most granular aspects of customer service.

“For example, we start with something as basic as saying, ‘you have to have a shower and wear clean clothes when you start your shift,’ ‘don’t talk on the phone,’ and ‘don’t chat with a customer unless spoken to.’ The last one is to ensure busy customers, say someone who is working, is not bothered by an overly chatty driver,” Ram says.

The company also allows for something called a “recurring driver” for someone who wants regular pick-ups and drops from say the office, or other places. A lot of customers end up asking for the same driver. But if a customer tags a driver “non preferred,” they are not matched with the same person again.

“For all new drivers that come into the system, we call up our customers to get feedback. We call up their first three customers. If anyone complains, we call in the driver to discuss what happened. Sometimes we retrain them, and make sure they understand what the issue was before he takes another job with us. Then we monitor him,” he says.

EziDrive charges about US$4 for a three hour round trip (even if you only ask for a one way drop), while an outstation gig starts at US$12. It also offers full weekend packages.

What about future plans? Won’t expanding into Delhi and other cities require more money?

“We are open to funding, but the value proposition should be ok for us,” Ram says.

This post EziDrive’s story, or how to scale a startup without VC help appeared first on Tech in Asia.

from Tech in Asia https://www.techinasia.com/ezidrive-rents-drivers-online
via IFTTT