A customer-driven approach to hailing a cab

Want a cab with air conditioning, a baby seat, free WiFi – and all from the touch of a smartphone button? The founder of Taxibeat talks about the inspiration behind his popular taxi-haling startup

Looking for a cab with air conditioning, a baby seat, free WiFi, even a welcoming hand to your pet – and all from the touch of a smartphone button? Nick Drandakis, the founder of the innovative Taxibeat app, talks about the success of his taxi-hailing startup

Nick Drandakis remembers the fateful day, in the summer of 2010, when he found himself in an isolated part of Kifisia, in northern Athens, looking for a taxi.

There was none to be found. So he got out his smartphone and opened Google Maps to search for the nearest main road.

“The idea came to me that it would be good if I could see the location of taxis on my map in real-time – if they themselves had a smartphone,” Drandakis recalls.

He didn’t know it at the time but he had sown the seeds of Taxibeat – the fast-growing smartphone app that allows you to hail a taxi and follow it on your screen as it approaches, all from the touch of a button.

A rare Greek success story in the current climate, the service has established itself in Athens and, to a smaller degree, Thessaloniki, and has in quick time been exported to France, Norway, Romania and Brazil.

And judging by the dozens of tweets reproduced on the wall as you enter the styled Kolonaki offices – “Used @taxibeat today. Excellent!! … @taxibeat rocks!! … @taxibeat je t’aime” – it’s filling a void.

CEO and founder of Taxibeat Nick Drandakis CEO and founder of Taxibeat Nick Drandakis

What we realised when we were researching the market was that it was the only one of its kind in the world that didn’t have a reputation system in place. It was a blind date. So we thought it was about time to do something about this. You have the right of choice.

Some 80,000 people nationally (100,000 globally) use the application and 2,000 drivers have subscribed to the service. No fewer than 800 cabbies are on the waiting list.

It’s not hard to understand why.

There is no callout fee for the passenger and you can handpick your driver – down to whether he offers air conditioning and mobile phone chargers, takes pets or what languages he speaks.

You can see whether there’s a baby seat and even free WiFi in the car. 

And nor does the driver know your destination.

The driver, in turn, pays a modest 50 cents for each fare that comes his way.

“I was sure that the next big thing would be in the mobile space so I had my antennae open to it,” says Drandakis, who has a background in engineering and web development. “I got on to my friends – developers – and we began to look into whether it was technically feasible to launch a service where you can follow the location of taxis in realtime. From that point it gradually emerged to what it is today.”

They wrote a business plan, successful applied to the Open Fund – the ground-breaking fund that provides financing to Greek-registered startups in the technology sector – and got to work.

“We operated on two fronts,” Drandakis recalls. “The engineers worked on the application and I walked the streets, distributing leaflets and trying to convince drivers to register with us. I must have walked around all the taxi ranks in Athens – from Glyfada to Kifisia. I talked to thousands of drivers, trying to explain how it would work. I was trying to find the small number who at the time had smartphones. We found 100 who registered and, in May 2011, we launched.”

Customer-driven approach

Ironically, Drandakis attributes the success of convincing even 100 drivers during the financial crisis.

“We were offering them a risk-free service,” he says. “Since you don't pay anything until you get a customer, you’ve nothing to lose. At the time, they were waiting endless hours without a fare."

Drandrakis stresses, however, that the business plan was built around the customer, not the driver.

“Typically, the problem wasn’t supply but the quality of service – especially for women and people who aren’t travelling very far, something drivers didn’t like,” he says.

“What we realised when we were researching the market was that it was the only one of its kind in the world that didn’t have a reputation system in place. It was a blind date. So we thought it was about time to do something about this. You have the right of choice.”

So a rating system was introduced for passengers. If you have a bad experience, or a driver doesn’t offer the services they advertise, you simply give them a low rating and say why – and every future Taxibeat customer sees as much.

And let’s face it, who doesn’t have a horror story to tell when it comes to Athens cabbies?

What even Drandrakis found surprising, however, was that the drivers embraced the idea of being rated.

“The problem was that they just didn't care. They weren't rewarded for good services and they weren't punished for bad services,” he points out.

If a driver doesn’t appear after being called, they’re blocked from the service for a day. Three strikes and they’re out. Likewise, if a customer doesn’t show up for three appointments times in a week, they are blocked permanently.

That's what I call "service". The taxi taking me to the airport offers free WiFi and laptop power connectors. Thanks @taxibeat

— Andreas Constantinou (@andreascon) December 3, 2012

Word of mouth

Perhaps the biggest success of the project, therefore, is how drivers have adapted.

“There's a miracle going on in Athens at the moment,” says Drandrakis. “A month ago I read that the mayor of London is planning to provide free WiFi to 400 London taxi drivers as part of a pilot project. Well, we have 700 here! And it’s all been through word of mouth by the drivers themselves.”

But it is a challenge, Drandrakis admits, not least on the technology front. For one, the fragmentation of the Android market means that the engineers are permanently on a bug-fixing mission just to stand still.

“The jury’s still out,” he says. “Three rounds of fund-raising have brought in 1m euros – nothing compared to the amounts needed by the growing number of similar services worldwide. But success will come when we no longer burn money. We still rely on outside investor money to keep expanding.”

At a simple level at least, however, the numbers do appear to add up. There are, on average, 250,000 cab journeys daily in Athens at approximately 8 euros a ride. And having gone for a conservative 50 cents-a-ride commission in the Greek capital, the Taxibeat arms elsewhere are charging cabbies between 80 cents and 1 euro.

“It's a very good and fair business model,” says Drandrakis. “We generate leads for cabbies who pay for what they get. And they like it because it works.”

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