French startup Drive just raised $2.7 million (€2 million) in Series A funding from undisclosed business angels and institutional investors. The service is reminiscent of Chauffeur-privé or LeCab — it’s an Uber-like service that owns its cars and operates with fixed prices.
But is there enough room for yet another startup? Chauffeur-privé, LeCab, SnapCar and Uber are already fighting hard to take over the French market. As this industry is a very capital-intensive one, today’s funding round is a good indication for Drive’s future.
Prices seem to be relatively similar to LeCab’s. But Drive operates Mercedes cars, that may be the main difference. Thanks to the new influx of money, the company plans to have more than a hundred cars in Paris and to open shop in multiple European cities by the end of 2014. In other words, the five month old startup remains quite small but already has expansion plans in mind.
Back in November, LeCab raised $6.8 million (€5 million). At the time, the company said that it wanted to have 350 cars in Paris alone by the end of 2013. Drive won’t be as ubiquitous in Paris.
Unlike Uber, you can make a Drive reservation in advance, and you get a fixed price. After saying where you want to go, Drive gives you a price that doesn’t vary with the traffic. You know how much you are going to pay upfront.
As a reminder, legislation issues could slow down Drive’s growth. The French government is trying very hard to protect the taxi industry. Since January 1st, transportation services have had to wait 15 minutes before picking a customer up. Some companies stated that they won’t follow the decree, but others said that they will comply with the new rule.
Chauffeur-privé CEO Yan Hascoet said that the French startups would contest the government’s decision and have a good chance of winning — the end result will probably come in a few weeks. For now, it doesn’t seem to prevent Drive from raising a new round.
Drive bets on premium services, quality cars and relatively cheap prices. I still think there are too many transportation services in Paris. Drive is a serious contender, but we’ll have to wait to know who the two or three winners are.
(Image credit: Bold Films)