Uber Has Yet Another Competitor in London: This Time Bolt
The success of Uber has attracted numerous startups to offer services on a similar model, meet Bolt.
Bolt has been one such rival for quite some time now and it has been giving a tough time to Uber in some of its biggest markets. The Estonian based Bolt (previously known as Taxify) is Uber’s main competitor in many European markets and, recently, it has announced to start offering services in the United Kingdom’s capital, London.
London has been one of the most profitable markets for Uber and various other companies have made efforts in the past to put a dent to Uber’s fort here. Founder and CEO of Bolt, Markus Villig, is hopeful to capture a significant market portion in London with the company’s current profit-sharing model that results in nearly 10% more income for the drivers. As opposed to Uber whose profit share is 25%, Bolt takes just 15% which results in better financial results for the drivers.
By following the same model of lower commissions and fares, Bolt has won over passengers and drivers across different African and European markets. One key aspect of Bolt’s model has been focusing on markets where Uber enjoys a monopoly and then offering a cheaper solution to win over drivers and passengers. Only the last month, Uber drivers went on strike in London in order to force Uber to lower its profit-percentage to 15% from 25%.
As per Department of Transport stats, nearly 90,000 private hire vehicles are licensed in London. Bolt claims that 20,000 drivers signed up with the ride company ahead of its launch.
Bolt was founded in 2013 and, since then, it has expanded its operations in nearly 30 countries and more than 100 cities. The company has well over 25 million global customers and, only last year, it crossed $1 billion valuation mark to enter the elite club of tech unicorns.
On the other hand, after going public few weeks ago and establishing the value of $80 billion, Uber has not been performing very well in the stock market as the company reports $1 billion loss for its first quarter leaving investors to worry about whether or not the business model is profitable in the long run.
Uber also took a blow from London city regulator when it got its license revoked on grounds of failing to adhere to corporate responsibility commitments. However, the license was later reinstated. Villig told media that it took his company more than a year to secure a license as well.