Egypt’s bus-hailing startup, SWVL, which is already present in Kenya, Pakistan as well as Egypt, has launched operations in Riyadh, Saudi Arabia, its fourth market since it was founded in 2017.
The Egyptian startup is seen as largely secretive about its expansion plans. In early 2018, when it raised tens of millions of dollars in its Series B-1, the startup said that it would use the money to expand to Southeast Asia, starting with Manila in 2019 Q1 but instead expanded to Kenya. In June 2019, the startup also said that it was planning to expand to Nigeria (by mid-July) but later launched operations in Lahore, Pakistan.
In Riyadh, Saudi Arabia’s capital and main financial hub with a population of close to 8 million, Swvl will join forces with other competitors including Uber, Careem, My Taxi, Jahz and Taxi Watani, among others.
Read also:Uber to License its Ride-Hailing Software to Three More Public Transit Agencies
In 2018, the Saudi Arabia’s Public Transport Authority (PTA) said there were 20 ride-hailing applications already licensed to run in the kingdom, with government further issuing statements that ride-hailing driving remains exclusively reserved for the country’s nationals.
In 2017, the country passed a royal decree allowing women to drive in the kingdom, a move expected to have a major impact on car transport businesses operating in Saudi Arabia.
SWVL is different from Careem or Uber in that instead of using private cars, the startup confronts the public transport system as whole by allowing commuters to book seats on its growing network of “high-quality” buses (owned and operated by third-parties). SWVL operates bus lines on fixed routes with customers boarding the buses from specific pick-up spots to be dropped at pre-defined (virtual) stations.
Saudi Arabia’s Expansion Further Confirms The Startup Is Not Afraid Of Competition
Swvl’s bold inroads into crowded ride-hailing markets have been one of its greatest strengths from day one.
For instance, although the startup is the first riding app to offer bus services in Egypt, giant transportation startups Careem and Uber had previously offered their own bus services.
Read also Bigger Market Share For SWVL In Kenya As It Partners Matatus For Long Distance Trips
In 2019, Careem announced that it was killing its bus-hailing service Careem Bus. The decision by Careem did not come as a surprise as Uber had in March, 2019 announced a $3.1 billion purchase of the Dubai-based competitor. The Swvl-like service had launched in December 2018 and was available in Egypt, Saudi & Pakistan. Careem’s parent company Uber, however, continues to operate Uber Bus in Cairo.
Mostafa Kandil, Egyptian CEO and founder of Swvl, has however, consistently noted that the joining of Uber and Careem to the industry has not influenced Swvl’s growth, asserting that Swvl has, instead, witnessed remarkable development since the two competitive players launched.
In 2019, the startup was valued at US$157 million, becoming the second Egyptian company after Fawry to reach these figures.
A Look At What SWVL Does
- Founded in 2017 by Mostafa Kandil, Ahmed Sabbah and Mahmoud Nouh, Swvl connects commuters with private buses, allowing them to reserve seats on these buses and pay the fare through company’s mobile app. The buses available on Swvl operate on fixed routes (or lines) and are presently available in over 200 routes including in major cities like Cairo, Lahore, Alexandria, and Nairobi.
- The startup launched its bus sharing services in Nairobi early 2019 after raising more than US$30 million in 2018.
- Although bus-hailing operations have been greatly affected by the coronavirus pandemic, the SWVL app which is available for both Android and iOS users has registered over a million customers who frequently use its services.
- SWVL also most recently signed an agreement with Ford motor company to deploy more cars on the road. Ford Transit, which the startup intends to use is already the third best selling van of all times. The startup is already in possession of about 100 Ford Transits. Hazem Taher, SWVL’s Head Marketing Manager, said the vans were ready to go and they’re excited to push them on SWVL’s route.
SWVL Saudi Arabia SWVL Saudi Arabia
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer