Easy Taxi, a Brazil-based Hailo-like app incubated by the Samwer brothers’ Rocket Internet, is today announcing a $10 million round of funding and plans to tackle a whole new market: Africa, along with more expansion also in Asia and the Middle East. It is starting first in Nigeria, a country of 180 million people and one Africa’s the biggest in terms of economic growth. The announcement follows news from last week in which Rocket Internet itself got an injection of $500 million, specifically to help build out its startups in emerging economies.
Today’s round of funding comes from Africa Internet Holding, a JV between Rocket Internet and 35% owner, telecoms operator Millicom. This is the same pair that backed Easy Taxi with $15 million in June, through another JV, Latin American Internet Holding. That earlier round is being used to expand Easy Taxi in Latin America. So far, Easy Taxi has amassed 1,500,000 downloads and more than 45,000 taxi drivers in markets where it is active, which include Argentina, Brazil, Chile, Colombia, Ecuador, Malaysia, Mexico, Pakistan, Peru, South Korea and Venezuela.
“We want to bring this success to other attractive markets and we see high potential in many Asian and African countries,” said Dennis Wang, head of international expansion of Easy Taxi, in a statement.
Sacha Poignonnec, co-CEO of AIH, tells me that after Nigeria, Easy Taxi will go to eight more countries by the end of this year, including Morocco, Egypt, Ivory Coast, Ghana, South Africa, Algeria, Tunisia and Angola.
So why Africa? The Samwer Brothers, as we described last week in a rare interview with the press-shy Oliver Samwer, have built out a global operation based around a strategy of taking tested business models for e-commerce startups into untapped markets (“clones” if you want to call them that; Samwer and Rocket obviously beg to differ). Then, Rocket Internet adds more e-commerce startups into the mix to get the most out of the infrastructure that has been put in place. The same goes for Africa and Easy Taxi.
For starters, the Samwers already have a number of businesses across Africa. “The good thing is that we already have operations across Africa. We have offices and entities and all logistics set up, plus we understand the huge potential of this growing market. That’s an important advantage that we have,” says Poignonnec.
Nigeria, he adds, is full of taxi services. They include drivers people hire for full-time work, those who can be hired by the day, and those for short, a la carte trips. The problem, he says, is that these are a challenge for users because of the logistics of the country and reliably calling a driver when you need him (or her). Waiting outside during rainy season to catch cabs, he says, is not an option many people would go for if they had the choice.
This is where Easy Taxi will come in: the company will be launching will both its existing iOS and Android apps, to tap into the country’s growing middle class of smartphone-owning userss to communicate via the app to find driver. It will also be equipping drivers with devices that will be preloaded with the app so that they can get taxi calls and respond back. After a driver is called, a customer will get pictures of how the drivers will look, their car numbers and an alert when that person has actually arrived.
Smartphone penetration is growing fast — some estimate that it will be 50% in a matter of years — but because Nigeria today is still very much one of the emerging markets with a still-low smartphone penetration, Poignonnec says that Easy Taxi will likely introduce a basic phoning service, tapping into its existing call centre infrastructure that was put in place for e-commerce sites like Jumia.
“Everyone will say that Nigeria is a challenging market to operate in, but once you have cracked it, you will crack all of Africa. That is what we experienced with Jumia and other ventures, which already became market leaders.”
In all cases, Easy Taxi is free for consumers to use. The company makes its money by taking a cut from the drivers, who will pay fees on a sliding scale depending on how many rides they give and other factors such as whether they sign up for “subscriptions” with Easy Taxi. Ultimately, Poignonnec says that the fees will work out to no more than 5% of the total takes for rides.