Surprise, surprise.
Last week, we reported the launch of a new taxi app called TaxiPixi, an e-hailing service originating from New Delhi, India.
But there is more. The Indian e-hailing service has reached a partnership agreement with Tranzit in which the latter’s online taxi booking business will be rebranded and re-presented to the public as TaxiPixi. Or rather, “TaxiPixi Africa”, as the official announcement says, declaring its intention to scale the platform across the continent.
Why? The deal is essentially an exchange of TaxiPixi’s Uber-like technology and Tranzit’s local capacity and traction. Both companies have similar enough models taxi/driver/user management models that a marriage made perfect sense. Their apps generate a fixed price which the user sees before confirming. Users can choose what class of vehicle they prefer, and can also book taxis in advance.
Since its re-launch in November 2013, Tranzit has acquired over 500 drivers. In the beginning, the service would only work reliably on the Island, where the initial cohort of taxis were concentrated. However, as the platform signed more drivers on, Tranzit got progressively better at serving users in most parts of Lagos.
While Tranzit got better at the physical and logistical elements of the business, the technology has largely remained where it was after it emerged from beta. This is where TaxiPixi comes in.
With names like Olacababs, Easy Cabs, Savaari, Cabs 247 and many more, India’s online taxi scene is nothing short of insanely competitive and well funded. Olacabs has received almost $300 million in total funding. And what’s more? Uber has tyres on Indian ground. in New Delhi and Bangalore. It therefore makes sense for TaxiPixi’s, which also raised an undisclosed amount in February, to want to explore emerging markets that are only just beginning to adopt e-hailing, and where the competition is not yet so competitive.
Some of the local players in Nigeria have been around for up to a year (Tranzit for more) and already have a logistical headstart. However, TaxiPixi’s technology could make a critical difference. With the exception of Uber which is indisputably the global state or the art in e-hailing, TaxiPixi’s technology leaves the other Nigerian online taxi services in the dust.
This explains how Tranzit could weather the recent exit of one of its founding members, who was also the startup’s lead developer.
On the other hand, the branding costs could be significant. You never know how users might react to seeing the app they are used to change identity overnight. Tranzit business executive and front-woman, Ugochi Ugbomeh says they’ve worked really hard to migrate user accounts and make the transition as smooth as possible.
It will also be a fresh start for the now former Tranzit drivers who TaxiPixi’s management would like to see use the driver-side technology more avidly, making the service more efficient and less error-prone.
As consolation, Tranzit’s users can look forward to a much better experience with the service. Via Android and mobile web at least. The iOS app is spectacularly buggy, but that is not a real concern where the Nigerian market is concerned. The official announcement says a Windows Phone application is also in the works.
Venturing into a market where Uber has launched is a pretty ballsy move. But both Tranzit and TaxiPixi are veterans, and have up till now held their own against the billion dollar startup in the respective markets. By joining forces with Tranzit, the clear local leader, TaxiPixi hopes it can become Uber, before Uber can becomes Tranzit. But Uber’s Lagos campaign is only just getting started though, so things will no doubt get more interesting shortly.
Is this a technology licensing deal or an acquisition? The management of Tranzit have declined to comment on the structure of the deal and how it would actually play out for both parties. Ugochi says Tranzit will continue to live on as a curator of mobile and location based services. Which means that their delivery service called Tranzit.it, a Tranzit feature that remarkably predates UberRUSH by at least five months, will continue to run.
The super-powers for new markets “partnership”, “merger”, “acquisition” or whatever this really is aims to expand beyond Nigeria’s borders. Abuja and Port Harcourt are ripe candidates, after which TaxiPixi will set its sights on other African cities.
