Start-up snapshot: Uber for motorcycle taxis in Rwanda
SafeMotos is a Rwanda-based start-up that connects customers with motorcycle taxis. The Uber-influenced smartphone app focuses on safety and uses data to measure a driver’s accident risk. Customers are linked to a safer motorcycle taxi driver for a premium fee, of which SafeMotos collects a 13% commission.
SafeMotos was co-founded by Canadian Barrett Nash and Kenyan Peter Kariuki. Nash tells How we made it in Africa about the opportunity for safely driven motorcycles, the risks in the market and why his business doesn’t need US$1m right now. Below are edited excerpts.
1. Tell us about your business.
SafeMotos is an Uber-styled motorcycle hailing app, but with a focus on safety. All of our drivers are equipped with cheap Android smartphones, and from these phones we are pulling data from gyroscope, accelerometer and GPS data. We are running all of this data through a risk model that sees things such as speed, and acceleration and deceleration trends. Based on the trends, we can automatically tell if a driver is one of our safest drivers or the least safe.
We then connect our customers to drivers who are the safest, based on their driving habits. We couple this with selecting drivers based on certain criteria. For example, we choose drivers who have a minimum of three years’ experience. We also incorporate customer reviews into our model.
The idea of SafeMotos first came into my mind when my mother came to Rwanda to visit me in April last year. She wanted to take motorcycles to get around and I thought: “No, they are so dangerous, I can’t let my mother take a motorbike taxi.” But I use them every day and so do most people here. It got me thinking because right now traffic accidents are among the leading killers in Africa and in cities like Kigali and Kampala most traffic accidents involve motorcycles. Many people here have horror stories about what happens with motorcycles.
Customers using SafeMotos benefit by being connected to a driver who has been pre-tested. They no longer gamble when they get on that motorcycle and there is no risk that this could be the rider’s first day on the job, for instance. The drivers working with SafeMotos earn more because we charge a premium price to traditional riders. We also give our drivers better helmets, jackets and smartphones on top of training. And they also get the capacity to access far more customers, especially during off-peak hours.
2. How did you finance your start-up?
Earlier this year we took part in the Irish startup accelerator Carma Axlr8r in Cork, Ireland. The venture capital fund they run committed an amount of follow-on funding, and we use them as our lead investor. We have since raised $130,000 from the accelerator and other angel investors.
3. If you were given $1m to invest in your company now, where would it go?
I would put the majority of it in the bank so we don’t get over-capitalised. We don’t have capacity to absorb $1m with our current plans. But we actually want to raise a serious amount of investment capital within a year. We are using Kigali and Rwanda to basically build a playbook for how we believe the SafeMotos model can work and be scaled across Africa.
Right now money isn’t our bottleneck. Our bottleneck is creating the right business model and that is more a matter of research, market understanding and experimenting with business models. A million dollars into that kind of framework can be toxic. But once we have understood the market using the funds we currently have we will do a series A round that we will use to quickly launch into five to ten cities across the continent.
4. What risks does your business face?
We need to confront the fact that safety isn’t a huge issue to many riders. If we can’t convince riders that increased convenience such as picking customers from their gate and safety are strong value propositions, it will be hard for us to compete. We also want to show there is space for premium services – which is something we haven’t yet proved.
We also need to be able to understand motorcycle taxi culture in different countries. We are expecting the lessons we learn in Rwanda can be brought into other markets without too much customisation, which is also a hypothesis. The fact is there are also very few real successful start-ups in Africa. Start-ups are by definition fragile and we are looking at a lot of headwinds – but then I think there is a huge market opportunity.
5. What has been your most successful form of marketing?
Facebook has been an incredible source of marketing for us just in terms of the brand awareness you can get for very little investment. Every week, for less than $30 we can hit about 60,000 unique viewers in Rwanda, which is just unparalleled.
6. Describe your most exciting entrepreneurial moment.
This was the first time I personally used SafeMotos in a real setting. One morning I opened my application and I indicated where I wanted to be picked up from. I watched the driver come down my street and he arrived at my gate. I thought: ‘My God, this thing can work!’