Uber, at least for the meantime, is unlikely to launch in Ethiopia, meaning local firms have been given a head start in the taxi hailing sector.
Addis Ababa-based taxi app, RIDE, now appears to have lost its first mover advantage with the launch of ZayRide, a more traditional Uber-style on-demand taxi dispatching system that connects riders and taxi drivers based on location.
But founder Habtamu Tadesse claims ZayRide is better suited to local conditions than Uber would be given that it is tailored to work on slow internet.
“Uber requires 3G, LTE or fast internet speeds, whereas ZayRide works perfectly on slow internet,” he said. “So it can be applied anywhere in Africa. We minimised the features and we use low resolution pictures so it can work on slow internet.”
Like Uber, ZayRide does not own any cars, but rather works with taxi companies and takes a 15 per cent commission on fares. Uptake has been relatively good given the startup only launched last month, with 1,000 riders and 530 drivers registered on the platform. There have been over 300 trips made so far.
Tadesse says there is certainly a market for ZayRide in Addis Ababa, which he says is the “political capital city of Africa”.
“Addis Ababa has the most international embassies on the continent, and one of the fastest growing economies in the world,” he said.
“However it lacks an adequate transportation system. The taxis are more than 30 years old and rusty. Only 450 taxis are in relatively good condition, out of 7,000. Addis Ababa is home to five million people, but only 300,000 have their own car.”
Moreover, using taxis in the city has traditionally not been safe, with robberies common, while taxis lack fixed tariffs and meters, meaning fares can be unpredictable.
“From my personal experience, since I’m a diasporan, taxi drivers usually hike the price up,” Tadesse said. “So I decided I needed to come up with a solution, which should be safe, convenient and affordable. That’s how ZayRide was formed.”
The startup conducts extensive background checks on all drivers, while fares are calculated based on kilometres travelled and time.
Tadesse, who used his personal savings to fund ZayRide, is in the process of seeking US$200,000 to enhance the application and hire skilled software engineers.