Startup pitch: PoolCircle aims to be at centre of peer-to-peer services
There are countless individual providers of peer-to-peer services in the accommodation, connecting locals with travellers and car rental segments.
But how about bringing all those players under one roof? Well, India-based PoolCircle is trying to position itself as that platform.
To begin with, and with the aim of acquiring 250,000 users, the startup has launched a mobile-based carpool service in Bangalore where the app acts as a platform for car owners and ride-seekers to find each other and share a car ride.
But, the twist to the tale is, PoolCirlce also caters to corporates where users can signup using their corporate email addresses, and search for car-share options within their respective companies. For example, IBM employees can search/offer car rides only for IBM employees.
Also, the app allows users to search/offer car rides only for their LinkedIn connects (to the level of first/second degree connections), and Facebook friends. The company calls these various network of contacts as ‘Circles’.
PoolCircle was founded by Raghu Ramanujam, a 12-year experienced professional who worked earlier at Zoho and InMobi. He was also a mentor at the Microsoft Ventures Accelerator since its inception in September 2012.
Ramanujam defines PoolCirlce as the “eBay of sharing economy” and further adds:
“PoolCircle aspires to be a platform that brings together ‘borrowers’ and ‘lenders’ just as eBay brings together buyers and sellers. It will use data to understand user preferences and sharing patterns across all their sharing needs, thereby offering a much better customer experience.
“This platform approach will also allow us to subsidize enabling services like insurance, payments and user rating across various sharing apps.”
In a survey by PoolCirlce, about 78% of the cars commute with just one person on a weekday office commute. The startup believes that the carpooling service can help acquire users rapidly before launching other sharing use cases.
PoolCircle is part of the Microsoft Ventures Accelerator at Bangalore (where it is operating currently), but wants to expand to other geographies (especially Western Europe and South East Asia) in the next few quarters.
Vine video about PoolCircle (turn on audio)
Q&A with Ramanujam below:
Size of the team, names of founders, management roles and key personnel?
We launched our beta-mobile app in December 2013 with a four member team, in just five months since inception.
Our team of Engineers – Gowtham Arumugam, Isaac Kingston and Premjeet Sharan – come in with strong background in Java, Android and iOS technologies.
We are self-funded and are just about hitting the road to raise our first round of seed funding of $200,000.
Estimation of market size?
Peer-to-peer sharing economy is expected to be a $26 billion market by 2017.
Revenue model and strategy for profitability?
As a platform that will enable real world transactions, opportunities for revenue generation exist in form of transaction fee, revenues from advertising and revenue from partners who offer their services on our platform.
However, the strategy until end of 2015 is to offer PoolCircle as a free service and focus on rapid user acquisition.
What problem does the business solve?
The PoolCircle carpooling app provides an economical, sustainable and safe commute option for individuals.
For enterprises, our carpooling app reduces cost on employee car parking and helps them meet their CSR objectives.
In due course, with our range of sharing use cases, we will offer a single destination for all sharing needs of our users.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
The idea to launch the carpooling app, to acquire users and to roll out more sharing use cases has largely remained the same since our inception.
However, at a more tactical level, we have made a couple of changes:
- We now work with enterprises, apartment groups and event organizers as customer acquisition channels. Initially, the strategy was to look at them as our customers, and sell to them.
- The current focus is now on acquiring users rapidly and we have made a decision to offer this as a free service, with no revenue being generated for the next six quarters
What is the strategy for raising awareness and the customer/user acquisition?
We currently work with three distinct channels to acquire users for our carpooling app – enterprises, apartments and events, largely using roadshows/on-premises campaigns.
These channels help us acquire users with high density and high trust levels. We have also had pretty good coverage in the press so far.
We will also use outdoor advertising and radio commercials in the short term for our carpooling app. We will use social media marketing once the initial base of the first 100,000 users are acquired.
Why should people or companies use the business?
Carpooling is the best way to reduce commute cost, reduce driving stress and lower pollution levels and PoolCircle offers to best carpooling experience. As a mobile app, PoolCircle offers the best user experience among all carpooling apps.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?
We envision PoolCircle emerging as a comprehensive sharing economy platform, with multiple, possible even third party developed peer-to-peer sharing apps.
The challenges we see are:
- User mindset – How effectively can we bring about/leverage user inclination to share
- Acquiring the first 100,000 users – Two sides marketplaces are the most challenging to build since there is always a need to manage supply and demand acquisition
- Regulations/legal challenges
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
Most of the startups in the sharing economy/collaborative consumption space are not exactly peer-to-peer.
PoolCircle is placing a strategic bet on the sharing economy driven by peer-to-peer sharing and we are building out our platform as such.
This will translate to better revenue on the supply side and lower cost on the demand side, by eliminating the intermediary.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style… and why?
Google. We believe that data is god and strive to be as data driven as possible in our decision making. Secondly, we believe in treating a new initiative as a low cost experiment to be scaled up rapidly when we see traction.
PoolCircle is an interesting company from multiple angles.
First, its trying to be a one stop platform for all sharing-economy services in travel where each of it is a sub-industry in itself that are served by players like Airbnb, Lyft, RelayRides, CarPooling and many more.
Second, the market that PoolCircle operates in – India. While the country is certainly encouraging tech startups, the issue of safety still remains as a concern among consumer-facing service providers, especially in the transportation segment where there are various issues reported in recent past.
As PoolCirlce rightly said (and prioritized too), the change in mindset among Indians to share their car rides with others, and for travellers to request car owners to join them seems a critical challenge. A tough barrier to break, but if broken, it can yield magical results given the population size of the country.
There are at least half a dozen similar startups in India, including, CarPooling.in, CommuteEasy, LetsDriveAlong, CarpoolAdda and RidingO. But, the positioning of PoolCirlce as a ‘service-for-corporates’ seems like a smart move. Also, there are no clear leaders in this segment in India.
With infrastructure continuing to be an issue in the country, services like this might be a starting point to take the peer-to-peer sharing concept to masses, rather than owning it.
Playing the devil’s advocate here, read this – Why carpool will never work in India.
Karthick was general manager for Tnooz in Asia until September 2014.