GetTaxi Ltd., which has developed a mobile app for calling cabs, has raised $20 million. Len Blavatnik led the round through Access Industries Ltd., and was joined by GetTaxi's founders, CEO Shahar Waiser (Smirin) and Roy Mor. The company will use the proceeds to launch its service in New York in a few weeks.
Blavatnik also invested in GetTaxi's previous round of $9.5 million in July 2011, which financed the company's London launch. The company has raised $30 million to date.
Waiser and Mor founded GetTaxi in 2010 in order to revolutionize the taxi market. The concept is to enable people to call cabs directly from their smartphones, rather than to call a taxi rank. The app automatically locates the closest cab, identifies its driver, and how long it will take to reach the caller.
To provide a reliable and easy-to-use service, it is necessary to recruit a large number of taxi drivers, which has upset managers of cab ranks, who feared that the technology was taking their jobs. GetTaxi is essentially a virtual cab rank that does not have to meet the requirements of a cab rank operator because it is a digital app, rather than a brick and mortar business.
GetTaxi Israel, run by general manager Motti Hasfari, operates 350 taxis in greater Tel Aviv, and has a waiting list of 300 drivers.
GetTaxi launched its London service in October 2011, and its Moscow service in March.
In addition to private customers, GetTaxi is focusing on business clients, who call cabs more often, and often pay a fixed monthly fee. In Israel, the company's business customers include Channel 2, Channel 10, Hebrew daily "Ma'ariv", Google Israel Ltd., the Sports Channel, and the Adler Chomsky ad agency.
Waiser said, "The financing will enable us to provide excellent service in New York, London and Moscow. GetTaxi already handles calls every ten seconds during peak hours." He added, "GetTaxi's vision is to revolutionize taxi services so that everyone can have reliable service in less than a minute. In this market, GetTaxi will become the option of choice for users to get around town."
Waiser told "Globes" that taxi calls and transactions made via the app double every month. As for the financing, he added, "This is definitely an impressive amount, but in our business, which operates in the offline world, heavy investment is needed in operations for support, sales staff, and so on. The cost of launching the service in a big city, such as the one planned for New York, is $5-7 million, which is why such a large financing round was needed."
Waiser said that GetTaxi's goal was not only to become the leader in the taxi market, but to change the way its users get around. "We want the taxi to become the preferred means of transport in a big city, such as Tel Aviv, London, or Moscow. If a cab is available within 2-3 minutes from when you want it, and its cost is the same as a private car including fuel and parking, then a taxi will be much more convenient."
Waiser added that free wireless networks would soon be installed in cabs together with credit card payment systems.
Waiser said that GetTaxi's solution can also indirectly help alleviate congestion. "There are thousands of private cars, but a major cause of congestion is 20,000 taxis driving around all day looking for fares. The moment you optimize the market, these cabs won't drive around for nothing."
Looking ahead, he said, "We want to build a company, and we're in no hurry to sell. Our challenge is to reach $1 billion in sales in a few years."
Published by Globes [online], Israel business news - www.globes-online.com - on June 6, 2012
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