Rocket Internet is evil. So they say. An business incubation empire sucking the money of investors and throwing out startups all around the world, copying whatever works, sucking in graduates and spitting them out in a high frequency. Evil through and through. The business history of the infamous Samwer brothers does not necessarily help make things better. There are very few companies, particularly in the startup sphere, existing with such a bad reputation. Whether Rocket Internet is bad or not doesn’t really matter because millions of people still use their services.
Maybe it is because the services Rocket Internet provides do resonate with consumers, and when you talk to – say Felipe Kasinsky, CEO of Easy Taxi – it turns out he is far from evil, nor are Easy Taxi’s goals. Felipe’s career started somewhat evil though – Investment Banking. He made up for that by moving to Change Fusion and helping startups in Thailand and the Philippine’s to grow. It is maybe no surprise that Felipe looks at Easy Taxi as a social project. “We provide taxi drivers with more rights, more income, access to technology, access to news. We are providing them with safer passengers. We provide passengers with safer rides and fast access to taxis than a hotline can.”
Most people don’t know this but 7 out of 10 drivers have been attacked at least once.
Taxi service is probably one of the most hated services in Bangkok, or Thailand in general. Way too often Taxis will just not bother taking you – particularly at typical night out hotspots – drive around the block a couple of times, don’t want to turn on the meter, are just plain unfriendly or just throw passengers out when they feel like they don’t want to take you anymore. Additionally there are numerous stories of rape and abuse, particularly of female passengers. This is however only one side of the coin as Felipe explains. “Most people don’t know this but 7 out of 10 drivers have been attacked at least once. Usually the mentality is that the driver is the dangerous one. What most passengers don’t think about is that they only take the taxi once or twice a day but a driver takes a passenger twenty times a day. He is much more prone to taking a dangerous passenger than you are prone to taking a dangerous driver. There is more risk on the driver side. The taxi is the drivers ground and the guest is coming in. They are very defensive towards their ground. When passengers come in aggressive, or are stressed out, or want to rush to work in the morning, they are always very aggressive towards the driver. The driver is therefore always very defensive. We meet with them outside their safe house, outside their work environment. They are really friendly – very different from the perspective you usually have. What we are trying to do is bridge this gap between drivers and passengers, and this misconception about standards and values. Drivers don’t understand passengers and passengers don’t understand drivers.”
Thailand has approximately 120.000 taxis of which 80.000 are in Bangkok.
Easy Taxi checks that drivers have a taxi license and driver’s license and it is also possible to report and rate drivers. Likewise, passengers have to registers. This process takes away anonymity and allows for a much more secure environment. Nevertheless there is a greater problem in general. Thailand has approximately 120.000 taxis of which 80.000 are in Bangkok. The number is steadily increasing. Out of those taxis are a lot that do not drive with a license or borrow taxis from each other, which is strictly speaking not legal, but there is no mechanism to enforce the law. Likewise one would expect that the current radio service should already allow for getting taxis quicker and more reliable, rendering Easy Taxi less interesting for consumers. This is however not the case, since most taxis have their radio off. “By law, every taxi that is not green and yellow has to have a radio. It’s a matter of safety, because they want taxis to have access to someone, in case something happens. The problem is that it’s not very well implemented. They don’t have an incentive to use the radio. It doesn’t work to their advantage. Passengers are far away, they don’t want to pick up passengers because they only get additional 20 THB, and there is a lot of traffic. And they just might cancel. There is only so much you can blame them for. When they stand in the traffic jam the meter stops and only starts again when they move above 6km/h, which means they lose money on traffic jams. 6km/h is nothing. That’s why they push for a meter to start at 50THB.”
The amount of registered taxis is decreasing every month. Obviously there is something wrong with the way the system is structured.
So why not increasing the starting prices of the meter, particularly since the price for NGV (Taxis usually don’t use gasoline but opt for the cheaper NGV) has been raised as well? As so often the problem is structure. “There are already many taxis on the road. If you increase the amount they receive you will increase the amount of taxis on the road because they don’t have implemented a good license system, where interested drivers have to buy a license. They have to register and do some other things, yes, but it’s a very simple process. Even if they would implement a better system you would still have an increasing amount of unregistered taxis on the streets. The amount of registered taxis is decreasing every month. Obviously there is something wrong with the way the system is structured.”
Where there is no solution from the regulators there is an opportunity for the free market. Easy Taxis provides drivers an additional source of income, or at least an easier source of income. “They can get the passengers that are closer to them and they don’t have to waste time going around, or at least they know where they are going to pick up passengers. Even if it is a little bit far, they still say I’m going there because a passenger is waiting for me there. They like that.” Drivers gain reliability and can secure income.
Because of the low fare here there is no way we can charge from the drivers.
In order for Easy Taxi to work in Thailand Felipe had to adjust the business model. “In other countries we charge from the driver because after three to six month there is a significant increase in ride they are going to see. It’s additional income for them so they should pay for it. However, because of the low fare here there is no way we can charge from the drivers.” Instead passengers are charged the same prices they would pay for the radio service, 20 THB. The advantage is clear, immediate confirmation if the taxi is coming, the time one has to wait, information about the drivers and the ability to cancel if it takes the taxi too long to arrive. Easy Taxi will even call you and ask why you canceled. “It can take you an hour to get a taxi because drivers refuse to take you, so you might be willing to pay 20 THB extra if you will get a taxi right away. If you are taking a taxi the average ride in Thailand is about 100-120THB, 20THB is marginal for the convenience for a much more premium service and much quicker.”
There is also a cultural reason why Easy Taxi charges passengers rather than drivers. “It’s a day to day mentality. If we charge the drivers they say I take the money away from them. If we say you are going to have more money in three to six month they will say, “I’m not even sure if I’ll be here in 3 to 6 month!””
Easy Taxi was the first company to enter the market. Grab Taxi recently received a significant amount of funding and Uber launched its, premium, service in Bangkok a couple of weeks ago. Felipe is not worried. “My view is that the more apps are in the market the more it benefits the drivers, the faster the market is educated and that will help us eventually. My target is to benefit the customers, passengers and drivers, since we are talking about a market place. Currently we are doing the hard work because the drivers don’t know that we have actually a solution to their problems. You want to be the first mover, want to spend the money, and want to create the story.”