Hailo drives its expansion into business taxi market
Battle of transport apps is hotting up, as €1bn backed Uber tackles Hailo
Published 26/06/2014 | 02:30
WHAT'S the key difference between Hailo and Uber, I ask Hailo's 'co-CEO' Tom Barr?
"Well, we think you don't have to destroy an industry to be disruptive," he says.
It sums up the difference between the two services quite well. Whereas Uber is provoking riots and city shutdowns across Europe, Hailo has quietly built an army of registered, licensed drivers who see the service as a totally compliant step into a digital future.
But does the level of kickback that Uber is getting – together with a whopping $1bn funding round – mean that Uber is the true disruptor, with Hailo being the new 'disrupted'?
"I don't agree with that," says Barr, a former Starbucks global boss. "What we've done is to show that we can work well with drivers and regulators. We value that all of our drivers are properly licensed. That means there are no concerns with regard to our drivers' safety records or anything like that. We think it gives comfort to people as well as our drivers."
Unlike Uber, Hailo largely uses existing taxi drivers for its services. The company that was founded in London by a couple of taxi drivers is now expanding across Europe and the US, with over €50m in funding behind it.
In Ireland, Hailo is an unqualified success. Available in more than 20 cities and towns, it counts half of all of Ireland's 18,000 taxi drivers as registered users. The "vast majority" of these, says Barr, are in Dublin. The Hailo app has been downloaded 500,000 times in Ireland.
A closer look at Hailo's fare structure reveals a purring commercial engine. The firm typically gets around 10pc of each driver's fare. In Dublin, it records roughly 20,000 daily Hailo trips. If an average fare is €20, that's €40,000 a day, or €1.2m per month in revenue. This estimate may be more (or less) than its actual revenue figure. But even if it's just half that figure, it's not bad for an operation that's primarily based on an app.
If Ireland is one of Hailo's most successful territories, is its charms as a potential European corporate base also of interest to Hailo?
"Well, our technology team is in London and we're committed to that for now," says Barr. "I do see us possibly diversifying different parts of our tech team around different parts of Europe and that might include Dublin. But we wouldn't be coming to Dublin to take advantage of any tax laws or anything like that."
Barr says that Uber's current media spotlight has been good for Hailo because of the focus it puts on car-hailing app services.
"When the tech space is as hot as it is right now, it's good for everyone," he says. "It helps grow everyone's business model."
But Hailo isn't completely oblivious to Uber's particular business model.
The taxi-booking service Hailo is to launch a series of new services in Dublin targeted at business users. The services, to be launched in July, will include a limousine option, a premium taxi option and a new service aimed at allowing businesses to book Hailo cabs online.
The limousine service, to be called Hailo Executive, will cost "about 50pc more than a normal taxi fare," said Hailo joint chief executive, Tom Barr. The premium service, called Hailo Plus, will cost "a couple of euro more" per trip, he said.
The company's new business-booking service, called Hailo Business, will allow companies to keep track of employees' taxi-booking activities, including detailed reports on who uses the service, where they travelled to and why they used the service.
"The new services are in response to what businesses are asking of us," says Barr. "Business users want a range of vehicle classes, including bigger and more prestigious cars."
Hailo Executive cars will apparently have no roof signs or the usual Hailo markings and branding.
"They're predominantly cars that have plenty of space in them, engines over two-litres in size and a long wheel base," says Tim Arnold, general manager of Hailo Ireland.
Space? Over two litres? A long wheel base? So we're talking about the Skoda Superb, right?
"Well, the Superb is a very nice car, but I'm not sure people expect it when they're booking a luxury vehicle," says Arnold. "We'll typically be talking German cars, like a BMW 7 Series or an Audi A8 or a large Mercedes. Maybe a couple of Jaguars or Lexus models, too."
Barr says that the whole thing, in planning for a while, will get underway from July 1s.
"It will remain a pay-as-you-go service for taxi drivers, who get paid once a week like they do from regular Hailo accounts. But we're looking at a credit facility option for corporate customers, which would include a 30-day credit option."