What to expect when you step into a sector-defining, market-bending office of a company like ekar? A bustling techno-scape of screens and geeks perhaps? Or maybe the loungey, beanbag-topia of scattered climbing walls of a Google hub?
ekar has been on T&FME’s interview hitlist for nearly half a decade so it’s frustrating that I am late for our first interview with GM Stanislav Betin to find out how it works. But a second spin around Barsha to find a car park space is a useful reminder that driving isn’t always a convenient option even in a car-friendly city like Dubai. And it is the concept of convenience that has spurred on ekar’s founders Vilhelm Hedberg and Ravi Bhusar for five years; taking the novel idea of car-sharing – a fusion of vehicle rental and taxi service – from obscurity to the mainstream in the UAE. It is also a major, if alternative, fleet operator in the market offering 1,000s of vehicles to those who can’t get a car and are priced-out of chauffeur/pro-driven services.
Through its app, cars can be hired for as little as 0.70aed per minute and it is proving to be a viable alternative to ownership for some city dwellers. After all, open the app and a few clicks later you can have a family car for the weekend on your doorstep or leave the office and make that run in a sports car you’ve been day-dreaming about all day.
Having finally got a space and paid for it – with ekar you can park at an RTA spot for free – a friendly voice greets me on arrival. I half-hope the customary coffee on offer is brewed in a re-creation of a New York apartment but a mildly disappointing walk through some discreet ranks of desks and chairs follows (especially for a company that had the highest utilised carshare service in the world before Covid-19). However, a few minutes with Stanislav Betin later and it is clear that this is a business that is operating at the cutting edge. It is also one that is evolving its approach and software development to keep pace with how transportation is changing.
“Mobility is growing into one holistic eco-system,” remarks Betin, adding that the company and its systems are purposely modular, effectively enabling it to bolt on new services as it moves forwards. “You start with one core business which is ride hailing, then you add car-sharing, then you can add micromobility…and you can move to a whole, complete universe (of mobility services).”
Betin was brought into ekar at the end of 2020 and it is easy to see why he was a good fit for a mobility company looking to expand. The native Russian speaker’s career has shifted from fintech firm success in Asia (“I got bored”) to his own ride-hailing start-up Fabcab in Sri Lanka which he built using a solution from a Bangalore software house. Despite 60,000 subscribers, and promising talks with investors and partners, including micro-mobility powerhouses Lime and Bird, the Easter Sunday bombings in 2019 shattered confidence in the tourism sector and he had to move on.
“After the bombing in 2019, the GDP fell by 10 times in Sri Lanka and investors were not paying attention to this market at all,” he recalls, adding that time spent in Europe after the attacks reinforced his growing interest in mobility and transportation.
“I travelled a lot in Europe and I saw this wave of eScooters and I thought, wow, this is amazing, we should do something like that. And it was not just people using it for fun. The way they did it in Warsaw was amazing because they had dedicated lanes so you could travel from the centre to the outskirts. Zoning was also done in a terrific way. I was reading a lot about Bolt (which provides a range of micromobility vehicles) and it felt like this concept could grow by adding more modules (vehicles and services.)”
One of his stops in Europe included a stint as CEO of Anytime Belarus Carsharing in the Russian satellite state of Belarus. His time there bolstered his belief in the concept of car-sharing before joining ekar in December 2020. The UAE firm is a like-minded company that wants to avoid being pigeon-holed into a single vertical and take an agnostic approach to what it can offer: “We are thinking about how we can find our space,” he says.
The UAE is also proving to be increasingly open-minded about the concept with Betin suggesting that acceptance is growing so fast that regulation is struggling to keep up. A situation that isn’t as beneficial as it may seem at first.
“Customer acceptance is developing much faster than the regulation. But when regulation keeps up pace, it’ll be a great market to operate all sorts of mobility.”
Feeling the blues
The ekar pay-as-you-go fleet was instantly recognisable with its blue car liveries in its formative year. It was also synonymous with the MINI brand. It later added five Tesla S and X models to its fleet in a partnership pilot with Abu Dhabi’s sustainable masters MASDAR.
While these vehicles have been fundamental to building its profile and reputation, Betin’s appointment has marked a more aggressive approach to broadening the range of vehicles it is using and the app service’s appeal. ekar ended 2021 by doubling the vehicles on offer to a 1,000 new vehicles including the new 2021 Kia, Hyundai and Mazda cars from the ranks of its car rental partners. Betin says he was keen from the start to push for a range of vehicles that ensures it can offer the full gamut of cars from economical, compact sedans, sports cars, sporty mini SUVs, to family-sized vehicles.
He tells T&FME that even before joining he looked at ekar and could see how some things could be done better in a variety of areas including pricing and its pricing structure. Most of all, getting the fleet right was at the core of how he could see the firm growing.
“At that time, everything was about MINIs,” he says. “They were recognised everywhere but I knew from experience that they were an emotional choice of car which can get boring very quickly. You also have to spend more time on the servicing and a few other bits.”
Fortunately, Vilhelm Hedberg was open to his suggestions and Betin was soon getting an insight into a firm that isn’t afraid to do things a little differently.
“He said, let’s have a call and Zoom session and he gave me the full narrative of the company. What amazed me was that he started walking me through the company presentation and it was the first time that somebody was selling me his company like that.
He was so passionate about it, I barely gave him feedback!” He says with a grin. “I said about ten words, and he said, ‘you know what, I’ve got a board meeting in a week’s time, why don’t you come up with a presentation on what we will do next in another country.”
Betin quickly compiled one of the most meaningful surveys for the potential of car-sharing and ride-hailing attempted to date. Examining 15 countries, their regulation, oil prices, the number of active cars and the success of similar platforms to ekar, Australia emerged as the outstanding candidate. Especially after he churned through other data such as trip lengths and journey types, and how ekar would fit in the market. Oh, and he did that all within a week.
“I managed to put this showcase together for Australia and how it compares to the numbers we have for the UAE. It was easy,” he says blithly. “50% of those countries were already ‘nos’ based on the average income per capita (because that matters) and car security…once you put in these numbers you could make projections on ekar’s pricing, fleet occupancy, income per car per day.”
“(For Australia) I said we would not start in Sydney if at all, but Adelaide, Melbourne, or Brisbane,” he remarks, adding that immediately he could see that he and Hedberg shared the same vision on mobility even if it wasn’t yet clear how they would use his expertise:
“We had this chemistry and I got the job. I was pitching Australia as a launch market but,” he laughs. “I was told I had to stay here.”
Betin spent his first few weeks taking a deep dive into the ekar app, which services it was offering, and learning what features were possible and those that were unlikely to get regulatory approval in a market that is still maturing. Although that can sometimes work in your favour.
“For example, in Minsk, I took 100 vehicles from Moscow which were sitting idle, and just changed the SIM card. It was Covid time, the Mayor of Moscow had switched off car-sharing, so I just shipped them. I had the head of state police in Minsk calling me to ask why there were 100 vehicles with Russian number plates (on the streets). It wasn’t prohibited as the regulation isn’t there. The customers were making fun of it saying, look we got these from our big brother.”
He continues: “Here, you don’t have that flexibility. There is the relationship with a leasing entity and that we (have to) own the license. There are ways you have to on-board a vehicle and how the pay per minute works. In Abu Dhabi and Sharjah, you can get the same car for a minute to a month. But in Dubai you cannot. We also have the restriction of having a maximum of 200 vehicles in the pay-per-minute fleet and they are all RTA branded. Then we have a daily fleet in Dubai which you can extend and these are on separate licences.”
Despite the intricacies of the market, Vilhelm Hedberg recently said the firm is feeling extremely bullish about its prospects. Visitors continue to pour into the EXPO 2020 Dubai event and both local residents and the steady return of tourism are helping to turn the mobility start-up into a major transport platform.
Behind the deceptively straightforward process of ordering a car through the app is a sophisticated suite of software that is constantly analysing where and when cars are likely to be in demand.
The proprietary algorithms developed by the ekar data and tech teams places carsharing cars in the optimal areas – and at the right time of day – in the cities in which ekar operates; ensuring a car is within walking distance in some of the most popular districts.
The frequency in which cars are returned, service, cleaned and sent back into the field is also constantly improving. Booking percentages are up by over 30%, and have allowed it to introduce dynamic pricing that changes depending on where and when you are booking. It can also change depending on who you are. New users or lapsed ekar veterans (or super users) are incentivised by pricing or offers to tempt them into the eco-system and hooked on the idea of car-sharing.
Part of this increase in utilisation has been through extra demand and partly due to the technology that drives the business – and by extension the businesses of its car rental partners which share revenue from each transaction.
“We started the revenue sharing model last year. The daily car fleet licenses are owned by them, and we tech-enable them. We put them in the sweet spots where they enjoy high utilisation. We clean the cars, refuel them and do the maintenance at a third-party location.
He explains further: “We have a few agents that help us with cleaning, and we also have a group of technicians, drivers who are technicians that can do some small repairs. We relocate the vehicle if needed to the service station and out them where they will have a better chance of being booked. So it’s a whole infrastructure. When we are looking at ekar, we call it as mobility-as-a-service, right? Because it’s not only the app, but the whole back end to that.
Betin shows T&FME a dynamic heat map of Dubai that displays where cars are and where they should be moved to get a booking. This is fleet management at the cutting edge.
“We have built an algorithm which we call fleet rebalancing. It operates with two layers of data. One is historic bookings and the second is the number of app openings. Normally heat maps are static, but ours is dynamic and checked every hour,” he explains, before a revealing example of how people are still the main drivers of success even in an operation like ekar.
“We had pilot with a third-party solution, but I said to my data engineers let’s try and build it in-house. They said, you know what, we’ll do that as a home assignment after work,” he says. A couple of months later they had successfully created an entirely new way of knowing when and where the cars should be at the busiest times for the app.
“It is entirely predictive. We start our fleet rebalancing plans (where the cars need to be placed) at 2am for the morning and then in the morning we work on the afternoon. Later we will work on a 24-hour span,” he explains. “We were sitting with our friends from Sixt and they were saying this is very academic. This is exactly the term that we are looking for. We are bringing people here with degrees in math and they are building something which you could call rocket science.”
With our time coming to a close, T&FME asks how far can car-sharing in the market go. Looking at his on-screen map again, he says, that Dubai is one city where there is a need for a lot more cars to be available for car-sharing.
“We know that if a car is 250m or less from a user the probability is 45%. Anything more than that it drops to only 6%. The market is dying for additional vehicles and there are not enough.”
With cities like Moscow having 26,000 vehicles available for car-sharing, he suggests that the mobility stakeholders in the market need to be working together to ensure availability. Especially in a world where having 10s of thousands of cars sit idle in a city is becoming less sustainable: “I get asked what’s the next big thing for car-sharing in the region all the time and I always answer education. With proper marketing and access to cars down below 250m away the numbers would be skyrocketing. We are not afraid of competition because that means additional fleet and the more cars we have, the higher the utilisation we will have.”