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GrabTaxi

Overview

GrabTaxi is a Malaysian start-up company providing an on-demand dispatch service. It allows users to track and book the nearest taxi, car or motorbike that operates within its network in real-time by using the GPS locator built into the smartphone. With this technology, GrabTaxi hopes to optimize the matching process between taxi fleets and passengers. GrabTaxi, known as MyTeksi in its home turf, Malaysia, where it was founded in 2012, operates in the Southeast Asia region. It is known as GrabTaxi in the region and currently operates in 20 cities in six countries (Malaysia, Singapore, Thailand, Vietnam, The Philippines and Indonesia).

The company was started by two Harvard Business School (HBS) graduates, Anthony Tan and Hooi Ling Tan, who pitched the idea to revamp the local taxi industry. They won second place in the 2011 Harvard Business Plan contest.

Mission

GrabTaxi mobile software seek to overcome the inefficiency in the taxi industry that exists in Southeast Asia region. The start-up company uses smartphone technology and multiple data-points to match taxi drivers and passengers. The company held to the principle of providing a service that is parallel to their business pillars; Safety, Certainty and Speed.

History

GrabTaxi was founded by Anthony Tan, a Harvard graduate who pitched the idea to revamp the taxi industry in his home country, Malaysia. The idea of a taxi-booking mobile app came up when a friend visited Malaysia and had a bad experience with the local taxis. The friend wasn’t sure if the driver was taking the right route and what should have been the right fare. “What’s wrong with your taxi system?” The jibe from the friend forced Tan to think about a solution and take it up as a project, at Harvard. Tan and another Harvard graduate, Hooi Ling Tan, who is also a Malaysian, pitched the idea to the panel of the 2011 Harvard Business Plan competition, which led to the duo being placed second, making them the first all-Asian team to have success for many years.

Official Launch

GrabTaxi, or MyTeksi as its known in Malaysia, was officially launched to the public on June 2012. It was expanded to The Philippines in August of 2013. The application was launched in Singapore and Thailand in October of the same year. The expansion then followed by the launch of GrabTaxi in Ho Chi Minh City, Vietnam, in February of 2014.

The start-up launched in Jakarta, Indonesia in June of the same year, and subsequently launched it in Cebu, The Philippines in July of 2014. In September 2014 GrabTaxi launched the beta version in Pattaya, Thailand and in Davao City, The Philippines, in September and October, respectively. It was launched in Iloilo, the 4th city in The Philippines, in March 2015. The same month, GrabTaxi was launched in Surabaya, Indonesia, making it the third city in the country.

In November of 2014, GrabTaxi launched its first GrabBike, in Ho Chi Minh City, Vietnam. It is a trial service in Ho Chi Minh City. In May 2014, GrabCar was launched in Malaysia and Singapore, GrabCar serves as an alternative form of transportation service that uses cars through a licensed partner to ease the lack of supply of public transportation during peak hours. GrabCar service is available in Malaysia, Singapore, Thailand and the Philippines. In the Philippines, GrabCar+ service was launched in February 2015, providing an alternative form of transportation using a fleet of higher-end cars.

Research and Development

GrabTaxi announced the launch of its first R&D centre in Singapore on 8 April 2015. GrabTaxi is investing US$100 million over the next two to three years into the 4,500 sq ft facility located in Singapore’s central business district. The R&D centre can house up to 200 engineers and data analysts. Its focus is to analyze data and spot trends.

Funding

GrabTaxi announced its Series A funding for an undisclosed amount in April 2014 with Vertex Venture Holdings as lead investor. CIMB, a Malaysian bank was appointed as the main financier. In May of 2014, GrabTaxi announced their Series B, worth more than USD 15 million. The funding was led by GGV Capital, a Silicon Valley-based company. The funding also includes Qunar and returning investor Vertex Venture Holdings. The Series B funding was designed to assist GrabTaxi’s growth into new cities in Southeast Asia, as well as ensure driver loyalty and rollout retention programs, according to a statement.

In October, the start-up announced the completion of its Series C round of financing of approximately US$90 million, one of the largest rounds ever in Southeast Asia. US-based Tiger Global Management led the round, with existing investors GGV Capital, Vertex Venture Holdings, and Qunar participating. Hillhouse Capital Management of China, also joined in as a new investor.

In December of 2014, GrabTaxi announced their Series D funding, amounting to USD 250 million, fully invested in by SoftBank Corp – in what GrabTaxi claims is the largest investment ever made in a Southeast Asian internet company on the public record to date. The funding will be utilised to accelerate growth of GrabTaxi in the region. The total investment received by the company over the last 14 months amounted to US$340 million.

Fleet

GrabTaxi as of March 2015 has more than 75,000 drivers registered in their network and currently there are seven bookings made every second.

Service Coverage Areas

GrabTaxi operates in 20 cities across 6 countries in the South-east Asia region.

Table 1: Countries and cities where GrabTaxi operates.

Features and functionality

The GrabTaxi application is available on Android, iOS and Blackberry 10 devices and Window phones. There is a one-time activation process for first time users. The user only has to specify their location and their destination in the “From” and “To” field. The built-in GPS automatically detects the location of the passenger and locates the nearest driver. The estimated charges and the summary of the driver’s details of the booking will be shown on the next screen once the booking is successful. The user can also add additional “Tip” for the driver. The driver, who uses the same application can then accept or reject the request. When a booking is made by a commuter, the phone shows in real-time a list of cabs being offered the job. Once a match is made, the commuter’s and the driver’s phone numbers are immediately made available to each other so that they can communicate about any unexpected issues. Dialling can be done from within the app.

The drivers and commuters are likely to be using 3G devices, so the response times are much faster than those from the operator’s terminals, which are on the much slower GPRS. This eliminates annoyances such as many drivers turning up for the same job or commuters getting in another cab because they think their booking was not successful.

GrabCar, GrabCar+ and GrabBike services are available on the same platform as GrabTaxi, which in turn, offers the GrabTaxi users a transportation option when they are travelling in any of the 6 countries where GrabTaxi operate in.

Languages and localization

GrabTaxi is available in 6 languages -- English, Thai, Vietnamese, Chinese, Bahasa Malaysia and Bahasa Indonesia. The same GrabTaxi app is available in all the countries in which it is operating— namely Malaysia (where it’s known as MyTeksi), the Philippines, Thailand, Vietnam and Singapore, and the user interface of the application is the same in those countries.

There is multiple services or taxi types that can be chosen by the user. The pricing model for GrabTaxi in Malaysia is on a tiered percentage basis – ranging between five to 10 percent of the taxi fare, in the Philippines, it charges the passenger 70 Pesos per passenger. In Bangkok, a 25-baht booking fee surcharge applies on top of the normal metered fare, which is only turned on once a passenger is inside the taxi.

Promotion

In 2014, GrabTaxi launched its “My Wild Teksi campaign” in Malaysia. The campaign mechanics were simply to get potential customers to take a “selfie” with the decorated taxis and post it to their social media. The approach to attract users and downloads was similar to GRABeng Christmas campaign in 2013 launched by GrabTaxi in the Philippines.

In Thailand, GrabTaxi has rolled out multiple marketing campaigns when it was newly launched there in 2013, ranging from a special promotion on Mother’s Day to booking fee waivers. Grabtaxi has been has been especially aggressive with its marketing strategy, from partnering with local coffee shops in Vietnam to participating in large online campaigns like Online Fever.

GrabTaxi won the 2014 Promotion Marketing Awards of Asia’s Best Cause, Charity Marketing of Public Sector Campaign Silver Awards for their “Delivering Happiness” campaign, a donation drive to collect used toys and books to donate to rural libraries in. The campaign, which ran from 28 December 2013 until 19 January 2014, appealed to the public to donate used toys and books with free pickup service by MyTeksi drivers.

Reception

The existence of GrabTaxi in the six countries in which it operates in has created a major shakedown in Southeast Asia’s taxi industry, providing an appealing transportation service to tech savvy populations. In Singapore, GrabTaxi received majority votes in an online poll conducted by Singapore’s Straits Times as the taxi app of choice.

Regulatory Issues for third-party taxi booking apps

Recent regulatory issues have arisen for third-party booking apps like GrabTaxi, but there seems to have been few issues surrounding the company in the 6 markets that they are in. The tech company has also received the support of the Malaysian Public Land Transport Commission (SPAD) when the government department introduced the use of technology using the GrabTaxi applications to enhance efficiency of taxi drivers in Malaysia. The company is working with the government department to improve the image of taxi drivers in the city.

GrabTaxi also expanded their services to Penang in September 2014, when it was officially launched by the Chief Minister of Penang, Lim Guan Eng. The company has also maintained a close relationship with local regulators, evidenced by the Jakarta Governor’s public support of the GrabTaxi’s entry to the market.

One issue that the brand currently faces is the recent change in regulation in Singapore, which makes the destination field in the app an optional entry rather than a compulsory field. This change will be implemented by April 2015.

Awards

GrabTaxi was named Frost & Sullivan Best Travel App of 2013, and the company also scored the 2013 Malaysian Venture Capital and Private Equity Outstanding Trustee Company award. The founder, Anthony Tan received the 2014 PIKOM ICT Technopreneur Excellence award. The same year, the mobile app company was awarded the 2014 I-S Magazine Reader’s Choice Awards Coolest Local App, and the 2014 Promotion Marketing Awards of Asia’s Best Cause, Charity Marketing of Public Sector Campaign Silver Awards.

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