On-demand autos are a blessing in disguise

Mobile apps have given commuters and drivers something to smile about

Unitus Seed Fund
Published: 15, May 2015

Unitus Seed Fund is a venture seed fund supporting startups innovating for the masses in India. Unitus invests in healthcare, education, mobile commerce & value-added services, marketplaces & e-commerce, retail & distribution, agriculture, and water & energy sectors. Founded in 2012, Unitus Seed Fund is part of the Unitus Group, a financial services group operating in India and other emerging markets since 2000. Unitus Seed Fund is based in Bangalore and Seattle.

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Shruti let herself quietly into her home (in a quiet suburb of Bangalore’s Outer Ring Road), happy that she would not have to disturb her parents as they watched their favourite 9.30 pm soap opera on television. In the background, she heard the autorickshaw drive away noisily into the distance. She would wait until dinner to break the news about her promotion and impending three-month stint in Mumbai. She'd always wanted to experience living on her own and had put it off because her parents would be worried to have their only child (and daughter) living alone in a big city. Her parents, until very recently, would have been waiting to hear the door bell ring instead of watching their favourite soap.

Now, they know Shruti has an app that allows her to order her ride home, are aware that the driver can be tracked, and know she will not be stuck in office until some unknown auto driver feels sorry for her and charges her twice the fare. This small change has made a huge difference in enabling Shruti's independence– she is set to fly the nest!

After having dropped off his last customer (in a quiet suburb of Bangalore’s Outer Ring Road), Ramappa came home at 10 pm, tired. It had been a long day after all and yet, it was different. He was tired after a hard day's work instead of tired from waiting to get work. In the many years of his career (the only career he had known) as an auto driver, he could finally sense that  change was happening; he suddenly felt more in control of the income he could earn every day. And being in control of income meant he was more in control of his life. In an almost involuntary gesture of gratitude, he clutched his mobile phone, the enabler of his new life. As he turned his mobile off to unwind for some well-earned rest, he had a quiet confidence that when he would turn it on the next morning, there would be good money to be earned. He fell into a happy slumber, even as airplanes he could not dream of took off and landed in the distance–the airport was not far away.

The plane made a smooth landing, albeit an hour late at 11 pm. As Amit stepped out of the aircraft, he was not agitated by the delay as he normally would have been. Today was different, his day trip had been hectic but successful–the investors could finally see his vision, understood that he was on the right side of history and ready to back him with much-needed funding. Funding that would shift the focus from a four-wheel tango to a three-wheel foxtrot. As he stepped out of the airport, there was no sight or sound of autorickshaws but he knew that as he moved away from the airport and into the city, there would be visible proof of why he was sitting on a potential gold mine.

Shruti, Ramappa and Amit represent all that is good about the on-demand economy in the three-wheeler space. They all know that on-demand three wheelers represent a huge opportunity for betterment of lives all around. How many of us have not had terrible autorickshaw experiences across the country? How many autorickshaw drivers have perhaps wanted to serve better but instead were reduced to being inefficient and angry because of the meagre income they stood to earn. Understanding the common pain point of the aam aadmi (and there are many of us), entrepreneurs have jumped into the fray to create a business and offer a solution. What has become to be known as the “überfication of things” has the ubiquitous mobile phone playing a lead role.

While some taxi-on-demand companies are now moving into the auto-on-demand space, the jury is still out on whether they will have the focus that is required to transform the service and bring it into the red hot sharing economy. Should it be left to entrepreneurs whose single focus is making the auto-on- demand a reality for the aam admi? Or will autos just be one marginal feature of Uber’s and Ola’s on-demand transportation juggernauts. While Ola took the auto route earlier (with every other hoarding announcing their latest play), it almost seemed like Uber would prefer its four wheel focus. However, the hugely competitive nature of the space and the unbelievable valuations ensured that the Uber app had the auto option pop up soon enough.

It is still a long journey ahead before the “organising the autorickshaws” story can go down in history as a fabulous one to tell. The vast majority of drivers are still unorganised, lacking in technology, and distrustful apart from a natural inclination to give into the jugaad of things. While the price of smartphones is falling to delightfully low levels, we are a long way from a 100 percent adoption. The next time you tap your app to summon an mGaadi, or Autohona, or Autowale, or Jugnoo, or the many other auto avatars, perhaps you might want to stop for a moment and marvel at how far we've come.

From having to stand at the corner of a street waving haplessly at every auto that went past, empty but unwilling to stop, or stopping but unwilling to take you where you want to go, or willing to take you but at twice the fair price. The on-demand economy might just be what finally redeems the auto story.

- By Sandhya Thukaram, Dealflow and Partnerships, Unitus Seed Fund

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