While at Babcock University, Chinazom Arinze decided to find a side hustle to support herself and take some stress off her parents. After trying real estate and failing, she turned to something she had always loved: cars.
Arinze noticed that students at her private university often travelled out of state during the weekends, so she decided to build a business around that. The vehicles that students typically boarded were uncomfortable and congested, so Arinze decided to rent smaller cars and hire drivers to transport the students instead. What started as her organising car trips for students from her school, in south-west Nigeria, to Lagos, 45 kilometres away, and back, soon turned into a thriving mobility tech startup, AutoGirl.
AutoGirl was launched in 2019, and offers online vehicle rental services across three categories: cars, boats, and jets. Arinze has driven the company beyond the walls of her alma mater to become a company operating in multiple cities, with 18 full-time staff and 20 contract drivers. According to Arinze, AutoGirl has completed 3,000 rides in Nigeria and provides mobility services to about 123 companies.
TechCabal had a chat with Arinze about the challenges of operating in the mobility sector and what her plans for the future are.
What would you say are the challenges with operating a mobility tech startup in Nigeria?
In the beginning, when I was involved in the sale of vehicles, one of the challenges was actually being shortchanged as the middleman. This turned out to not be a problem in rentals because people really need a company to trust and hold accountable when it comes to taking care of their mobility due to the safety risks that come with it.
Another challenge has been the rising cost of fuel as it threatened to cut down our profit margin. However, we’ve been able to come up with the solution of having different price points for fully-fuelled vehicles, minimum fuelling, and no fuelling. This prevented us from having to increase our prices by almost 50% when the fuel subsidy was removed.
Dealing with drivers has also been challenging as it demands a lot of time and resources to make sure that they are fully trained and verified.
Security is a very important component of mobility tech. How do you approach that?
When we were entering the rental space, it was very important for me to actually do some competitive analysis of the people that were already in the space. I noticed that insecurity was one of the major reasons why people did not fully enjoy the services of other players already in the space, and decided that security was a strong point that we didn’t want to negotiate on or even gamble with.
This is why the number of our drivers does not increase as rapidly as all the others do because there’s a lot that goes into their verification. We make sure to verify their locations, their houses, and their guarantors, just to be sure that the people using our service are safe. We have an entire team that is focused on checking in with drivers every single hour because a lot of our service quality comes from the quality of drivers we have working with us.
We have trackers on the vehicles, as well as an operations team whose job it is to know the location of every vehicle at any point in time.
What are some things that you wish you knew before venturing into the mobility sector?
That I needed to move faster and build our technological infrastructure earlier than I did. If I had deployed resources into making sure the platform was built with the momentum we got in our first year, we would be much bigger than what we already are. Mobility tech is already becoming an interesting sector as, every day, more players are starting to see the viability. Having the first-comers advantage of an online platform that was already being used as far back as 2019 would have really helped.
Have you experienced some challenges in terms of wanting to expand?
Expansion is never easy because you’re going into uncharted territories, but one thing that has helped us is our strategy. This includes having launch managers in every city that we are launching in, and that kind of helps to give us complete local context and also foster trust among the people who are going to be our partners. Expansion is also expensive, but thankfully, we’re doing it at a time when there’s a lot of demand for our services.
What are your future plans for AutoGirl?
We have plans to expand to other cities in Africa, which makes me excited because I see it as a way to encourage foreign investors, tourists and businesses to come to Africa. They no longer have to worry about how they’re going to move while they’re in a city in Africa and are now assured of safe mobility while they are in the country. We are looking to enter African cities that have a large number of expatriates like Abidjan, Kigali, and Nairobi. The goal in the next five years is to expand to at least five African cities in Africa.
What is driving the high interest in mobility tech?
The market is ripe, and people can now see companies like ours that have built a car-rental marketplace with a model that is sustainable. Because, when we started, there were lots of questions about whether this would work. This year alone, we have seen different players launch in the market, and I believe that the reason is that they are seeing how much of a scalable business model this is. Nigeria is a country of people who like to have fun and show up well. We have a lot of events on a daily basis that people need to move around for. The need for mobility is almost as important as the need for food as people will always need to move.
Five years ago, not a lot of accelerators were interested in mobility tech, but right now, there are a lot of people across the board who have realised that this sector is important and profitable.
Mobility is a male-dominated sector. Are there any steps that AutoGirl is taking to bring some inclusivity?
We have the AutoGirl empowerment program for women, where we’re going to be training women for free on how to drive and be great drivers. That way, they can earn money on our platform either as contract or full-time drivers. We’re interested in inclusivity and creating avenues for women to earn money as well. The drivers on our platforms earn at least ₦100,000 monthly, and while that is not a whole lot, it is a big jump from the minimum wage and what the average woman in Nigeria will earn.