December 7, 2019 Finance and Tech Publication

European Uber rival Bolt says it’s seeing signs of profitability in most markets

Bolt CEO Markus Villig

Bolt

Estonian ride-hailing firm Bolt is starting to break even in a majority of the countries it operates in, its CEO has told CNBC.

The company is now profitable — or close to being profitable — in two thirds of its markets, Markus Villig said in an interview Monday.

Founded in 2013 as Taxify and rebranded this year as Bolt, the start-up has racked up 25 million customers and 500,000 drivers in 35 countries across Europe and Africa.

It launched in London again in June following a botched attempt to do so without an operator’s license in 2017, and Villig says the firm has seen a lot of traction there with 1.5 million passengers and 30,000 drivers signed up to the platform.

By contrast, Uber — which was stripped of its license by the regulator last week — has about 3.5 million users and 45,000 drivers. The Silicon Valley giant, which first started operating in London in 2012, has said it intends to appeal the ban.

Like Uber, Bolt remains unprofitable. The group lost 61 million euros ($67 million) on revenues of about 80 million euros last year. But Villig said the company has managed to offer lower prices and takes less commission from drivers than Uber does as it’s the “most cost efficient ride-hailing company in the world.”

He added that achieving company-wide profitability “mainly comes down to the question of how quickly we want to expand.”

“London and most of these big markets require huge investment up front to attract enough drivers and customers to the platform,” he said. “If we were to stop expanding, we would break even next year.”

‘Tremendous interest from investors’

At 25, Villig is the youngest founder of a European unicorn, or privately held tech company valued at $1 billion or more. Bolt is currently in talks with investors for a new round of funding, and reports have suggested that investment could cement its unicorn status.

“Now investors are looking at which company is having a sustainable model and could be profitable quickly,” Villig said, adding his start-up has seen “tremendous interest from investors” in the last few months. Bolt’s backers include Chinese ride-hailing operator Didi Chuxing and German automaker Daimler.

“What it means for us as a company is that we have a great position to be really heads-down and stay focused on execution and provide the best value for customers and drivers.”

Following Bolt’s successful launch in London, Villig said he “absolutely” sees the firm expanding further across the U.K. into other cities like Manchester and Liverpool, but didn’t offer a concrete timeline for when that would happen.

“Our strategy has always been that we start in the capital, which is usually the biggest opportunity and has the biggest problems to solve. Then we go down into the smaller cities,” Bolt’s chief said.

The company is one of many firms looking to chip away at Uber’s dominance, particularly in London. Following the decision by Transport for London (TfL) not to renew Uber’s license last week, Bolt and French rival Kapten instantly started putting out positive publicity on the move.

To complicate matters further, another taxi-hailing app is looking to make its debut in London in a matter of weeks. India’s Ola, which is also backed by Uber investor SoftBank, recently started registering drivers in the U.K. capital ahead of a planned January 2020 launch.

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