Car2Go: Driving into the B2B

Market

A business plan proposed by: Donna Maher, Avi

Kletzel & Romy Ribitzky
Sofaer iMBA, Spring 2012

Tel Aviv University, Recanati School of Business

 Table of Contents

Chapter 1: Executive Summary………………………………….3

Chapter 2: Opportunity, Market need & Size..…………………..5
Chapter 3: Vision and Core Concept …………………….……...7
Chapter 4: Value Proposition & Business Model …………….....8
Chapter 5: Context- Industry & Timing ………………………....9
Chapter 6: Strategy & Competitive Advantage………………....11
Chapter 7: Operational Plan …………………………………...13
Chapter 8: Sales & Marketing Plan …………………………….15
Chapter 9: Financial Plan (with assumptions) ………………….18
Chapter 10: Organization………………………………………..20
Chapter 11: Team & Management………………………………21
Chapter 12: Required Resources………………………………...22
Chapter 13: Legal & Shareholders………………..……………..24
Chapter 14: Evaluation of Uncertainty & Risks ………………..26
Chapter 15: Potential Exit, ROI & Key Learnings ……………..29
Chapter 16: Corporate Social Responsibility …………………..33
Chapter 17: Conclusions, Recommendations and Summary ......35
Chapter 18: Appendixes ……...………………………………..36

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 Chapter 1: Executive Summary

Car2Go, originally founded by Jonathan (Yoni) Gadish and 3 of his friends, is a company
experiencing growing pains. An entrepreneurial firm that won great buzz when it launched in 2008,
the company is struggling to maintain market share, reach profitability, increase revenues and grow
its customer base. While Car2Go initially had the first-mover advantage in bringing the concept of
car-sharing to Israel from Europe and the United States, where it was a cutting edge concept in social
responsibility, rental car companies, leasing companies and even car manufacturers are realizing the
financial benefits of this concept and are jumping into the market.

Rather than sit idly by and let others take a piece of its business, Car2Go realizes the need to change
and adapt to the encroaching threat. To that end, we’ve analyzed the feasibility of expanding the
Car2Go model into the business market, extending the company’s value proposition of offering
convenient, sleek vehicles on demand and by the hour, to some of Israel’s quality, hip, and luxury
firms.

Identifying barriers to entry, key cost and revenue drivers, we believe that Car2Go is looking at an
opportunity to grow its business, but risks abound. From acquisition costs—vehicles, human
resources and clients—to marketing and promotional costs to general industry and economic
condition risks, we’ve laid the groundwork for the considerations the Car2Go team must answer
before jumping into developing a new market segment.

Calculating the costs against the proposals currently on the table, we see that Car2Go is able to
finance the pilot program without having to raise additional capital--be it via seeking more venture
capital/private equity funding, issuing debt or having to plan an initial public offering. This finding is
encouraging as the capital structure of the company can stay intact.

Taking all the factors into account, we do believe that building upon its impressive board of tried and
proven entrepreneurs and industry professionals along with embarking upon a targeted and
conservative pilot program that allows Car2Go an opportunity to test the market at the lowest
possible cost and risk to the company. Our initial analysis finds that while there is interest in the

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market for Car2Go’s services, the company still has a long way to go in terms of educating HR
professionals and operational directors on its product offering, its technological savvy and why it
truly is a choice that makes financial sense among so many others.

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 Chapter 2: Opportunity, Market need & size

Car2Go subscribers choose car sharing as an alternative to owning a car, as it eliminates costs related
to financing, insurance, taxation and registration—or as a secondary solution in the transportation
infrastructure. The marginal cost per kilometer of car sharing is significantly lower, at 30% less, than
the high fixed costs involved in owning a car. Car2Go customers can save up to 15,000–20,000 NIS
a year by choosing car-sharing options. This is a substantial saving especially since the average car
owner only uses his/her vehicle for only an hour per day.

Car renting at Car2Go is done by the hour, which proves a great incentive for users to drive as little
as possible, decreasing the amount of cars on the road and eliminating pollution. Additionally,
Car2Go customers avoid the struggle of searching for parking spaces as C2G has designated parking
slots designated to the car sharing users.

Currently, Car2Go is the only major car sharing company in Israel but car sharing has proven
successful in other parts of the world. For example, Zipcar, a large international car sharing company
based in the USA, has successfully penetrated the market with its innovative solution.
Zipcar has been so well received that it went public in April of 2011.

In terms of market size, we first looked at the 3.5 million drivers that are registered in Israel by 20091
according to government officials. From those, 1,876,000 own a private vehicle. 75% of the number
of drivers are in Car2Go’s target market of 25-54 year olds, bringing our estimate of the total
available market potential to 2,625,000 drivers. We considered current owners as being potentially
interested in a second car for marginal use, so they could still become customers of Car2Go.2 Non car
owners can certainly use Car2Go as an alternative to car owning. According to market research
carried out on behalf of Car2Go, the Israeli market could reach 70,000-105,000 members, although
the company's business plan is based on 26,000 members during the first five years3.

1
http://www.nrg.co.il/online/16/ART2/125/172.html
2
http://www.ynet.co.il/articles/0,7340,L-3911336,00.html
3
http://www.jpost.com/LandedPages/PrintArticle.aspx?id=137775

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These figures show the alarming need for Car2Go to expand its business model. The company cannot
possibly survive on attracting 5%-10% share of the 472,500 customers in the available market that
we calculated (which is a better-case scenario than Gadish expects). While Gadish projects a 30%
growth rate4, we project a 20% growth rate considering the new entries and the price wars within the
industry. A typical 300 shekel day rental has gone down to 58 shekel as per the offers of new entrant
“Quickie”, from Avis5.

4
http://www.jpost.com/LandedPages/PrintArticle.aspx?id=137775
5
http://www.haaretz.com/business/taking-us-for-a-ride-1.418985

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 Chapter 3: Vision and Core Concept

Car2Go Israel is a car-sharing company that offers subscription packages to individuals or families
living in the center of Israel who can appreciate the advantages of not owning their own car. Car2Go
subscribers choose car sharing as an alternative to owning a car, as it eliminates costs related to
financing, insurance, and registration—or as a secondary solution in the transportation infrastructure.
The marginal cost per kilometer of car sharing is significantly lower, at 30% less 6, than the high fixed
costs involved in owning a car. Decreasing the amount of cars on the road eliminates pollution and is
a great way to add value to all stakeholders where Car2Go operates.

The company would have you imagine having the convenience of accessing a car whenever you need
it, right around the corner, yet instead of paying for maintenance and gas, you only pay per ride. Use
it for a few hours, or for the whole day. With Car2Go, you only get charged for the time you’re using
the car, saving your business—and your employees—meaningful cash. Let’s not forget that when
you pay per ride, you’re more conscious of why you’re making the trip in the first place--which
makes more people stop to consider the environment. With Car2Go, every one of the cars serves up
to 30 people, which means that we take 15 cars off the road. That leads to less pollution, less traffic,
and more parking spaces.

The context of this company came about metropolitan realities (in the case of Zipcar, in the city of
Boston, MA, USA) that enlarged the pain of concentrated populations in small areas, constantly
challenging for parking space. Citizens were obviously affected by the continuously increasing gas
prices and the multiple taxation that goes into car ownership. If that wasn’t enough, the constant
maintenance costs only strengthen the customer’s pain for drivers in the Boston area. The
opportunity that Zipcar has identified involves a niche market that is more conscious about their
trips. Zipcar identified marginal use for their cars as a way to share the multiple costs that it carries.
This model was successfully recreated in the Tel Aviv area and that is how Car2Go’s concept came
to be.

6
Green Facts, Car2Go
http://www.car2go.co.il/index.php?option=com_content&view=article&id=50&Itemid=56&lang=he

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 Chapter 4: Value Proposition & Business Model

Value Proposition: Offer a convenient, cost-effective alternative to taxis, public transportation and
car ownership for consumer and business purposes. Since car-sharing is currently not taxed, Car2Go
saves business and their employees approximately 40% in taxable expenditures on benefits.
Companies that can use Car2Go during the overnight hours can save 50% off the published prices.

Business model: Car2Go is a subscription-based business that charges an initial membership fee
followed by an annual fee and a per-use fee. As part of its corporate plan Car2Go can offer a three-
pronged solution:
● A branded, specialized fleet, complete with ops manager, for the exclusive use of the
business in question. This fleet can range from 1 vehicle to multiple cars, depending on the
needs of the business
● A non-branded, non-specialized fleet. Rather, Car2Go makes available its entire fleet of cars
to the business, ensuring that at any given time, an appropriate model car is ready for the
company’s use. This vehicle has Car2Go branding and comes out of a Car2Go location or
parking spot
● Car2Go licenses its proprietary car-sharing technology (C2G Logic) to the business. This
way, the company buying the license continues to use the its own cars but implements a car-
sharing model using Car2Go’s software
Costs for Car2Go include:
● Fixed costs:
○ Leases on 200+ cars
○ Customer service representatives/overhead
○ Office in Tel Aviv
○ Parking
○ Internet access
○ SG&A
● Variable costs:
○ Gas
○ Customer acquisition

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 Chapter 5: Context-Industry and timing

Competitors of Car2Go include other car sharing companies, carpooling companies, car rental
companies, and public transportation. Carpooling companies include Carpool Israel Rideshare,
Erideshare.com, and Carpoolworld. Competing rental companies include Eldan, Avis, Enterprise,
Shlomo Sixt, Budget as well as a smattering of boutique firms. Public transportation in Israel
includes different bus companies and the public train. Additionally, Tel-o-fun, a bike rental company
with 125 stations all throughout Tel Aviv, is also a competitor of Car2Go.

Industry

The market for car sharing has grown by tenfold compared to the 20th century. First started in
Europe, the car sharing concept can now be found in over 600 cities worldwide, 18 countries and on
four different continents7. The graph below shows the growth in number of car-sharing members
from 1988 to 2006. It is evident that car sharing is only becoming more and more popular and that

7
http://www.carsharing.net/library/UCD-ITS-RR-06-22.pdf

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the timing for Car2Go is on point.

Car sharing is seen as a young and innovative solution to not owning a car.

History of Car sharing

The first car-sharing company can be traced back to 1948 in Zurich, Switzerland and was attractive
to those who could not afford cars. While, more car-sharing companies began to emerge in the 1970s
and 1980s in France and Amsterdam, most were unsuccessful.

Car-sharing made a comeback in the 1990s with a successful company in Germany and throughout
Europe. In 1990, Carshare Portland, was the first official car sharing company launched in the U.S. in
Portland, Oregon. Today, Zipcar, founded in Boston in 2000, is currently the leading car-sharing
company in the U.S., and has hit such popularity that it went public in April of 2011.

Taxation Loophole

Car-sharing can not only save users a significant amount of money, but can also eliminate taxes that
must be paid by the company since they do not own the cars and since government tax agencies have
not yet figured out how to charge citizens who share their vehicles. Economist Keren Harel-Harari
found that 98.76% of car owners pay a car ownership tax of 83%8. Even employees in Israel who
receive leased vehicles as part of their compensation package can pay up to 700 NIS–1400 NIS per
month out of their own pockets, creating a double-taxation conundrum, as both the employer and the
employee are taxed on the lease benefit.

However, with Car2Go’s services (and with those of a car-sharing competitor’s), customers can
avoid this tax in addition to all the other lower-cost benefits of not owning a car. Additionally,
Car2Go’s customers also know that they’re part of a larger ecological solution to two big problems:
pollution in the form of CO2 emissions and traffic congestion. Since car-sharing lowers the number
of cars on the road, pollution is reduced. And as there are fewer cars on the road, traffic congestion is
alleviated.

8
http://www.jims-israel.org/pdf/EnglishCars.pdf

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 Chapter 6: Strategy & Competitive Advantage

Car2Go should continue to build upon its strong brand name and first-mover advantage. While
newcomers to the market and recognized rental properties are exploring the hourly business option,
Car2Go maintains its competitive edge by holding on to its entrepreneurial spirit, being nimble and
able to quickly pivot—and adapt to customer needs in a way that a larger, more established company
can’t afford itself.

Another key element of its competitive advantage is its patented technology. Car2Go has proprietary
car-opening technology but it didn’t stop there. The company’s tech division—C2G Logic—
continues to develop and implement technologies that maximize and make it easier for companies to
manage and leverage fleet operations. Companies that choose to forego Car2Go’s vehicle solutions,
or companies that operate outside of Israel, can purchase a license to Car2Go’s fleet operations
technology and within a short period of time can be up and running, managing their own group of
cars as if they were a mini version of Car2Go.

Yet despite these two key advantages, Car2Go’s size is a source of competitive disadvantage.
Mainly, its fleet offering, while a great selection for the B2C market, is somewhat lacking when it
comes to the B2B market. Most of our respondents indicated that in order for their executives—even
junior staffers—to use Car2Go’s services in official capacities (i.e., during business hours, for
meetings, customer shuttles, etc.) they would require a certain caliber of vehicle. In order for Car2Go
to be able to cater to the middle- and high-end businesses, which are the most desirable in terms of
ROI (please see finance section below), the company must boost its fleet to include luxury sedans
befitting executives who work in sectors such as finance, media, pharmaceuticals, retail and the like.
Suggested makes include, but are not limited to: Audi, Alfa Romeo, Mini Cooper, Mercedes, and
Lexus.

Finally, according to research by the Guardian Professional Network, among other competitive
disadvantages that a company can procure is failure to have a culture of sustainability 9.
Environmental and social performance management from companies according to Guardian’s

9
http://www.guardian.co.uk/sustainable-business/sustainability-key-corporate-success?newsfeed=true

11
research proves to create more value for a company’s shareholders by shaping more committed
employees and in turn a more loyal base of clients. It is crucial that Car2Go take this factor into
account and incorporate it into the company mentality.

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 Chapter 7: Operational Plan

It’s clear that there’s a need in the market for another solution in the transportation matrix—and
Car2Go may just be the answer to many small and mid-sized businesses’ pain. However, the
company must adapt its offering essentially to each firm. While we see that all companies agree on
the fact that executives must have nice cars to use when going on client calls, since we’re targeting
this offering as a benefit for junior or rising executives, we may be able to negotiate pricing on taking
a mid-range sedan. However, if the vehicle is going to be used as part of the daily drive to see clients,
it may have to be upgraded—which ups the cost and may lower the savings over other transportation
options.

So what’s a company to do? With Tamir Fishman we worked out an implementation roadmap that
begins with a coupon to adoption method.

● An initial introductory tryout in the form of a Groupon-like offer for a test period to all
employees. If there’s enough interest, TF would embark on a pilot testing program with
Car2Go. The target audience would be:
○ Employees who don’t currently have leased cars
○ New employees
○ Junior executives who the company may feel that it wants to compensate in a new
way
○ All of this points toward Car2Go developing a new market penetration model
● Pending the results of a pilot, TF would implement Car2Go as part of its roster of
perks/offerings in the 2013 benefits package

It’s critical to have open channels of communication and feedback throughout the process in order to
keep improving the model. Each customer has different needs and hence, we should expect the same
for each different business that Car2Go approaches. By gathering feedback along each part of the
roadmap, Car2Go can reach customized coupon to adoption models for each company or segmented
groups and hence meet their needs.

13
This model is easily implementable in other companies and helps Car2Go hedge its risk as it attempts
to break into the B2B market. Rather than having to buy a new fleet of luxury cars, customize them
to clients and then find itself with extra vehicles that are unnecessary should these clients decide not
to proceed, using a pilot to adoption program helps increase Car2Go’s revenues without dramatically
increasing the company’s costs and helps it analyze whether this sector is a profitable one to compete
in.

Therefore, we conclude that: Since Car2Go offers another option to car renting/leasing/purchasing or
public transportation, it has positioned itself as an offering for a niche customer—not a product for
the mass market. This differentiation is key to future marketing and targeting efforts.

Pilot launch should be completed by Q1 2013, while the assessment and feedback should be expected
from March through April 2013. Marketing, sales, and distribution channels can then be cultivated in
order to build upon a successful pilot and move into phase one of implementing a full-time
fleet/joint-venture/partnership with Car2Go.

14
 Chapter 8: Sales & Marketing Plan

Marketing for Car2Go’s B2C segment was primarily viral. “We began with an online advertisement
with a small budget of about $2000, the rest was flyers to create the PR buzz. Within one year we
had 75 articles in the press giving us great media exposure 10,” Gadish told INSEAD’s Center for
Entrepreneurship. “One of Jonathan’s partners Noam Margalit, owned some popular pubs, bars and
cafes in the nightlife area of Tel Aviv. He distributed the flyers and even mentioned CAR2GO on
some of the menus. Word spread rapidly and by 2009 Car2Go employed 12 people with three full
time partners and one part time. There were 3,000 members with a fleet of 50 cars, growing 30%
each month11.”

Since we know that while some elements of B2B marketing mimic B2C marketing but need to be
tailored to the “what’s-in-it for my company” question, we’ve identified the following three
challenges Car2Go faces in its appeal to the business market:

1. It has to educate companies on its value proposition and how it fits into the already complex
transportation matrix that businesses already use and feel comfortable with. As marketers we
know that setting out to change people’s mindsets is both a time-consuming and costly
proposition. Car2Go must convince executives, especially human resources and ops
managers, who have the power to adopt this new idea into the company that a car-sharing
plan not only fits into their budget, but also works to their advantage. Identifying the
appropriate company executive that has the power to make this decision for the company is
another obstacle Car2Go faces, however it can be achieved
2. Car2Go is operating under a business and marketing model that has worked well both in
Europe and the United States. However, bringing a tailor-made solution to Israel doesn’t
guarantee success. Therefore, Car2Go must adapt its model to fit the needs of the Israeli
corporate customer. We have identified in our research that the focus should be operational
as opposed to compensational, unless a new market can be developed, composed of

10
http://www.insead.edu/facultyresearch/centres/entrepreneurship/topent/Alumni-Gadish_J.cfm
11
IBID

15
 employees that could begin getting a shared car when they were previously not getting any
(for example certain kinds of salespeople or junior level executives).
3. In its B2C marketing, Car2Go has relied solely on lead generation and word-of-mouth via
targeted marketing campaigns and buzz generated by positive PR. However, to succeed in the
B2B world, Car2Go must be more proactive in its approach toward lead generation.

In order for Car2Go to overcome these challenges, we first identified a working knowledge of the
company and typical customers, then we set out into the field to perform a market study in 4-5 small,
medium and large companies in order to find out the following:

● Current benefits packages, operational business needs and how Car2Go can add value
● We’ve identified that in most companies, there’s an opportunity to enter the company as a
pilot rather than immediately be offered as part of the benefits package. This is actually a
win-win entry strategy for both Car2Go and its corporate partner as both companies can
assess the working relationship and whether teaming up would be beneficial.
● Entry models include coupon-to-adoption which entail Car2Go to propose an exclusive,
limited-time savings for the company’s employees. Should that generate enough interest, a
pilot program would be instated. A successful pilot program would lead to negotiations about
full implementation within the company as part of a benefits/operations package
● Get feedback and build tailored package
● Create sales pitch built upon customer needs, company offerings, Ishikawa findings and
detailed feedback

We recommend Car2Go to utilize our findings in order to standardize a marketing and sales strategy
for the B2B market, called “Coupon to adoption.” This program can be advertised and sold directly
to businesses through viral and media current channels. Car2Go can also choose to focus B2B efforts
to a specific sales team within their organization that could specialize in tailoring the specific coupon
to adoption program to each company, based on the same idea of trying out first by giving a coupon
with a certain benefit to the employee that would try the service. Examples of coupons could include:
additional working benefits, medical, groceries, services, etc.

Additionally a group of young and hip interns could visit industrial areas during lunch time in order
to generate buzz again around the services of Car2GO for a low cost (just their transportation to the

16
sites) in order to regenerate the initial buzz that accompanied the company at its launch. Examples of
sites could include Ramat Hachayal, Herzliya Pituach, Raanana industrial Park, Matam area in Haifa,
etc.

17
 Chapter 9: Financial Plan (with assumptions)

The following discussion and analysis of financial condition and results of operations should
be read in conjunction with Car2Go’s consolidated financial statements in order to understand the
financial status of the company:

Overview

Car2Go got financing from two key and influential sources. In 2009, Gadish began talks with
Pointer, a public safety products and services firm dealing in the auto and insurance industry. A 6
million NIS investment in exchange for a 51% stake in the company came along with smart money—
the supply chain contacts that Car2Go needed in order to expand. An investment by Tamir Fishman,
one of Israel’s leading venture capital and private equity firms—with more than $3.2 billion under
management—ensured that Car2Go had more room for growth.

Fleet Operations

Fleet operations consist principally of costs associated with operating the vehicles such as lease
expense, depreciation, parking, fuel, insurance, gain or loss on disposal of vehicles, accidents, repairs
and maintenance as well as employee-related costs. Fuel costs fluctuate as gas prices increase or
decrease. Fleet operation costs are expected to increase as Car2Go grows the number of vehicles in
its fleet to service a growing business clientele. However, as Car2Go learns how to better utilize its
systems and becomes more efficient, these costs should reduce and stabilize. As the company grows
it should also be able to negotiate better terms for its leases, building upon its brand recognition and
economies of scale.

Member Services and Fulfillment

Member services and fulfillment costs as well as human resources expenditures and credit card
processing fees make up the second bulk of expenses for Car2Go. These costs are expected to rise as
the company expands and adds more clients, which means more transactions and more customer
support. Since we recommend bringing on an experienced B2B marketing chief and operations
director, we may see a demand for additional overhead in member services headcount as well.

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Research and Development

Car2Go’s technology is one of its key competitive advantages. As such, it must be protected and
continuously updated. Expenses in this sector include human capital, labor costs, coding, testing, and
legal fees for patents. R&D efforts so far have been focused on improving both the front-end and
back-end interfaces, as well as marketing and selling the operational aspects of the technology
mainly to overseas clients. Currently R&D expenses account for approximately 2.5%-5% of
revenues, a figure that’s in-line with industry standards.

Selling, General and Administrative

Car2Go has been able to keep its operation lean and mean, staying true to its entrepreneurial roots,
but it is now time to loosen the reins and grow. As with most companies, SG&A expenses are made
up of labor-related expenses for sales and marketing, administrative, human resources, IT, online
search and advertising, PR and other promotional expenses, professional fees (i.e. legal, accounting,
finance personnel), insurance and other corporate expenses.

In order to compete in the B2B space, we expect these costs to rise for Car2Go, especially in the
marketing and human resources arenas as we recommend that the company embark upon a more
aggressive marketing campaign to encourage a successful pilot program as well as the hiring of an
experienced B2B marketing chief and an operations manager to support the marketing chief’s
initiatives.

19
 Chapter 10: Organization

Car2Go’s business plan was created in 2007 by Gadish as part of a business venture competition
project when he was enrolled at INSEAD as an MBA candidate. The company officially launched on
September 1, 2008 with a fleet of 8 vehicles in the center of Tel Aviv.

Today Car2Go has expanded to several other large cities within Israel and has grown its fleet to over
200 vehicles. Car2Go provides convenience to its customers as there is a Car2Go parking spot every
200m-300m within the cities that Car2Go operates.

Car2Go currently follows a functional organizational structure in which departments report to CEO
and cofounder, Gadish (please see chapter 11 for more information about the organizational team).
While the current organizational team of the company is solid, Car2Go must expand its team to
include specialists that will care for the needs of the B2B customer. More specifically, we
recommend that Car2Go hire at least one marketing head and one operations manager who will focus
on expanding Car2Go’s B2B clientele. Additionally, it is important that Car2Go hire one or two B2B
customer service reps who will report to the B2B marketing and ops chiefs. By having a separate
management team for each customer segment, Car2Go’s organizational structure will shift to a
product organizational structure. This is crucial as our research has proven that the B2B customer
segment has different needs than Car2Go’s current customers. Please see chart below for a
recommended outlined product organizational structure.

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 Chapter 11: Team & Management

Car2Go is helmed and backed by a proven team of entrepreneurs and board of advisors. In addition,
Tamir Fishman, one of Israel’s leading private equity firms, invested in the company via its parent
company Pointer and subsidiary Shagrir.
The management team includes:

 Jonathan Gadish, CEO & Business development. INSEAD MBA; B.Sc in Industrial
engineering from TAU; Naval officer; Project manager with Tefen, operations management
consulting (5 years); Business development in Suncar - car rental.
 Gerrard Gadish – Operations, founded Suncar, car rental and leasing company, in 1983.
Currently the owner and CEO of Suncar with 3 branched and close to 1,000 cars.
 Noam Margalit, Sales & Operations, B.Sc Industrial Engineer from TAU; serial
entrepreneur, owns several businesses in the night life arena of Tel Aviv, including some of
the most trendy bars and Cafes. Education from Massachusetts Institute of Technology - MIT
and Shenkar College of Engineering and Design.
 Benjamin Ninio, Marketing & Customer Service B.A. Business Management from IDC &
Wharton; Customer service and sales manager in tourism industry; Programs coordinator at
Jewish Agency, Research coordinator, John Hopkins University.

Board of advisors:
 David Brook – Cofounder and senior manager with Flexcar, 2nd biggest car-sharing
organization in the USA (now part of Zipcar)
 Nathan Strauss – Parking solution consultant
 Gal Bardea - Brand manager at P&G
 Cobi Barnea - M&A & strategic alliance consultant
 Yonatan Factor – Branding expert
 Conrad Wagner – Car-sharing consultant (Mobility)
 Michael Aidane – IT architect, serial entrepreneur
 Johnny Sabag – Former advisor to Shaul Mofaz, deputy Prime Minister and Minister of
Transport

21
 Chapter 12: Required Resources

Where we saw the most room for improvement was within Car2Go’s board and network, an
untapped resource. A meeting with Tamir Fishman, an investor in Car2Go’s parent company,
revealed a potential fit for both sides and yet neither had previously considered exploring the
synergy. We recommend that as Car2Go considers right partners for its pilot program it first look
within its board of advisors and their networks to see what natural partnerships may already exist that
are right at its fingertips. With a little probing Car2Go may have its pilot right within its board, and
there’s nothing like a group of interested parties to make an initiative work.

In order to make inroads into the B2B market, Car2Go will have to make a substantial investment to
grow its luxury fleet. The company is already in the process of acquiring several Alfa Mito vehicles
in order to answer rising demand for more upscale models, but we’ve calculated that to carry out a
pilot which will run across 5 companies—2 small, 2 mid-sized and 1 enterprise—Car2Go will need
to lease or purchase a total of 10 better or luxury-level cars (Lexus, Audi, Mercedes sedans) at a cost
of $350 per month (1,400 NIS)-$1,000 per month (4,000 NIS)12 respectively.

Additionally, we recommend that the company bring in both a head of marketing to lead the B2B
effort in terms of outreach, planning and client relations, as well as a head of operations for B2B.
While the B2B Marketing Director must have experience in this segment, and will therefore
command a higher salary—20,000 NIS-25,000 NIS per month given 3-5 years of experience13
according to AllJobs. For a marketing manager with some business development experience, that
salary is in the range of 18,000 NIS-21,000 NIS per month.

Technology is not going to add costs since it’s already been developed and is actually a revenue
driver to Car2Go. The car-door-opening technology, as well as the operational fleet management and
reporting technology that is patented is continuously developed by Ben Ninio and his team. In order
for Car2Go to operate in the B2B realm however, no immediate advances in the technology need to

12
Audi lease info obtained from Audi of Boston, Christopher Wall, dealer.
13
Salary table link: http://www.alljobs.co.il/SalarySurvey.aspx

22
be made. In fact, some companies prefer to just license the technology aspect of Car2Go’s offering,
using employees’ existing cars and essentially mimicking the Car2Go fleet experience.

For companies who want to take advantage of Car2Go’s car-sharing offering but want a more
exclusive look and feel, Car2Go can offer a tailor-made exclusive fleet furnished with branded
vehicles. The costs of branding a car to a specific company vary depending on the model that the
company selects. Fitting the car with the company’s decal adds only marginal costs and may actually
help save Car2Go marketing costs as satisfied customers continue to spread the message that Car2Go
is a reliable and right transportation solution—a move that is consistent with Car2Go’s method of
marketing and evangelizing.

As Car2Go’s customer base grows it will likely need to acquire more parking spaces. While it will
not need to pay for parking near or at offices (as it can pass on those negotiations to the companies it
partners with so they can leverage their relationships with landlords—at least at the pilot phase),
Car2Go should increase its available parking spaces by 25% around the most popular locations
around the areas it services, as those are the most likely locales that clients will choose to have
meetings, etc.

Car2Go will pay for these costs by building them into the pilot proposals, rather than having to take
out a bank loan, issue debt, or appeal for private equity funding. For example, the price plan for
Tamir Fishman (see section 18, Appendices, below), which includes an Alfa Mito for 4,600 NIS per
month, a Honda Insight Hybrid for 4,000 NIS per month and a Nissan Acko for 3,300 NIS per
month, in addition to the monthly usage fee and initiation fees, cover the costs of acquiring the Alfa
Mito and taking the other two vehicles out of Car2Go’s daily rotation for other clients.

23
 Chapter 13: Legal & Shareholders

Contract and Charter:

Each Car2Go member must read and sign the subscription agreement which describes the
responsibilities of the subscriber. More specifically, the agreement covers the following topics:
general information, appendices, prioritization of appendices, substance of contractual relations,
period of agreement and consideration for the services and mode of payment. The subscribers’
payment details are also documented in this form. After signing the agreement, subscribers are given
an electronic key card that allows entrance into Car2Go vehicles they choose to rent.

In addition to the subscription agreement, all Car2Go users are presented with a charter form that
further describes the nature of the relationship between Car2Go and the subscriber. Topics discussed
in the charter are as follows: threshold considerations for receiving the services, terms of use and
maintenance of the cars, duties and responsibilities, collateral, payments, damages, fines, business
subscribers, supply of the subscriber’s cards, privacy of subscribers details and intellectual property.

Municipality

Car2Go has received permission from several major cities throughout Israel to designate parking
spots just for Car2Go members. Cities have an incentive to work with Car2Go since it works towards
decreasing air pollution.

Intellectual Property

Car2Go currently has a patented car door technology that allows subscribers to access the vehicle
they register to use. The company has also made this technology available to businesses via
licensing.

Shareholders
Car2Go is a private company and therefore share information is not publicly available. However,
we’ve discovered that in the initial round of investing, family and friends helped to bootstrap the
company from concept to the seed stage. Gadish, who started the company with 3 friends, ended up

24
having to switch partners mid-stream, adding his dad and 2 others in order to keep Car2Go going14.
The new partners split equity in the ventures and by 2009 the company had grown to 3 full-time
partners, one part-time partner and 12 employees.

To fuel further growth, Gadish and co. spoke to several private equity and VC firms and tried to
engineer different types of deals (following a second round of FFF financing). In the end, they settled
on debt financing of 6 million NIS from Pointer in exchange for 51% of the company. Additional
cash arrived later from Tamir Fishman in the form on an investment in Shagrir/Pointer, Car2Go’s
parent company via a Tamir Fishman fund.

But the company is still in the red and looking for ways to turn a profit. While Gadish had originally
hoped to navigate Car2Go to a quick exit, the financial crisis of 2008 quickly derailed those hopes.
And with its U.S. twin Zipcar also suffering dire financial losses on the scale of millions of dollars,
investors are shy to drive more money into the sector.

14
http://www.insead.edu/facultyresearch/centres/entrepreneurship/topent/Alumni-Gadish_J.cfm

25
 Chapter 14: Evaluation of Uncertainty & Risks

Car2Go has reached a point of market saturation with its B2C product offering and must therefore
explore other revenue streams, especially as it struggles to reach profitability.

The first risk is doing nothing and keeping the status quo. By keeping to its current business model,
Car2Go risks not growing its business, indeed shrinking its operations, as it loses customers to
competitors (at a typical rate of attrition of 5% annually). And with new entrants flooding the market,
Avis’ Quickie service is just the latest example15, Car2Go needs to figure out an effective solution--
fast. Established companies and nimble entrepreneurial firms have pushed pricing wars that have
seen rates slashed from a high of around 200 NIS/day to a low of 58 NIS/day. At these margins it’s
difficult to eke out a profit on consumers alone, especially if volume isn’t maximized. Therefore, it’s
time to explore whether expanding into the commercial, or business, market.

In exploring the feasibility of a B2B option, we spoke to current and former Car2Go customers as
well as 13 companies of various sizes in Israel. Our findings include:

● Car2Go makes sense as a secondary car solution; meaning, they will not replace their
primary, daily car, but will consider not buying a second car for a spouse or significant other
and instead use Car2Go for hourly drives/projects
● Car2Go does not make sense for a company that has many executives who all travel from
home to office and office to home at the same time since they will all need the cars at the
same time
● Having to return the car to the same pick-up location is a deal-breaker in 89% of the cases. If
Car2Go found a way to economically pick-up cars from one-way trips, or have a way to
centrally command and control the fleet, that would be ideal and bring in thousands more in
revenues
● Startups and mid-sized companies could be a great target as they’re more willing to take risks
on new initiatives. Entering larger corporations would mean going after mid-managers who
are not already beneficiaries of car leases and would therefore not have to give up a benefit—
rather, they would feel that they’re gaining a benefit

15
http://www.haaretz.com/business/taking-us-for-a-ride-1.418985

26
 ● Executives will not be willing to give up their cars
● Executives demand luxury cars, which Car2Go does not provide in abundance
● Offering Car2Go as part of a series of secondary benefits to mid-level managers who don’t
already get car leases is an excellent way to pilot the program and test whether it would gain
corporate acceptance at no risk to the host company
● Young professionals would be more willing to try this out
● Car2Go must increase its hybrid or electric car vehicle options in order to be seen as a truly
green solution

Understanding the customer objections and needs, Car2Go must realize that expanding its fleet
before validating that there’s a market need is a big risk. Just because corporate leaders say they
would consider Car2Go as an option doesn’t necessarily mean that they would sign on the dotted line
once Car2Go comes up with a B2B product offering.

Since the average car lease costs approximately 1,000-3,000 NIS per month16, Car2Go needs to
embark upon a year-long pilot program in order to make the costs worth its while. Additionally, a
branded-option, meaning that the company uses a Car2Go vehicle with its own branding on it—
effectively taking this vehicle out of operations for other companies—makes the proposition even
more expensive since the costs are not being shared among multiple customers.

In order to hedge against this risk, protect Car2Go’s financial interests and maintain good working
relationships with potential customers, we recommend that Car2Go embark on coupon-to-adoption
models with small- and midsized companies and pursue full-time contracts with large companies.
The coupon-to-adoption model outlined above allows both Car2Go and its clients to safely, and
economically, explore the option of offering Car2Go as part of its transportation infrastructure.
Predicting the state of the economy and customer demand for Car2Go’s product is always a
challenge. However, the benefit of reaching out to the B2B market is that businesses will continue to
have meetings and woo customers, no matter how poor the economy gets—indeed, the worse the
situation is, the more executives need to meet with potential customers face-to-face. And while
international travel is often among the first expenses to be cut during economic distress, short, in-city
trips—where in-person meetings can have a big impact—are typically favored.

16
http://www.ianglo-auto-association.com/lease.html

27
However, Car2Go must watch its rate of expansion. Growing too quickly and implementing too
many pilots can weigh heavily on its finances and put undue financial pressure on its operations.
Additionally, in order to appeal to attractive companies, Car2Go must be careful about who it
chooses to align its brand with. Selecting the right fit for a pilot is key to successful implementation.

Therefore, we recommend that Car2Go undertake no more than 5 pilots within the 2013 FY under a
strict vetting process, preferably two with small companies (one with an established small business,
one with a startup), two with mid-sized businesses, and one with a large business. By embarking
upon these studies with a broad range but a small exposure, Car2Go limits its risk but maximizes its
learning potential about acceptance and market reaction to a B2B offering.

Additional risk factors include, but are not limited to:

● Potential changes in insurance laws that would make it cost-prohibitive for Car2Go to
continue covering insurance premiums
● Changes in tax laws that would make it no longer attractive for consumers and businesses to
choose car-sharing over car leasing or car ownership
● Changes in labor laws that would increase the costs of hiring and retaining employees
● Safety concerns and/or recalls with any of the vehicles offered by Car2Go would
significantly detract from the company’s bottom-line and erode customer trust
● The ability to secure parking at popular locales where the company operates—and hopes to
grow—is essential to the success of the business
● Any Internet outages, downtimes, interferences would severely undermine Car2Go’s
credibility and may curtail any companies doing business with Car2Go if the system is not
reliable and available at any and all times that it is needed

28
 Chapter 15: Potential Exit, ROI & Key Learnings

The goal for this project is to increase Car2Go’s revenue stream by finding new markets in the B2B
sector. There is no need at this time to go public by filing for an IPO. There is a need to find new
investments in order to cover the costs of additional fleets or sales/marketing.

Car2Go must decide if it can provide the investment capital itself or tap new sources. The investment
will be returned in the form of increased revenues by added business volumes. The idea is to
establish a new clientele in the B2B sector.

In order to help Car2Go break into the B2B market, increase its market share and gain wider
visibility overall, we initially interviewed 5 current Car2Go customers and a handful of former
drivers in order to get anecdotal data about their experiences. All are either currently employed by
companies who allot lease cars to their top employees, or have enjoyed this benefit within the past
year. Their comments were as follows:

● Car2Go makes sense as a secondary car solution; meaning, they will not replace their
primary, daily car, but will consider not buying a second car for a spouse or significant other
and instead use C2G for hourly drives/projects
● Car2Go does not make sense for a company that has many executives who all travel from
home to office and office to home at the same time since they will all need the cars at the
same time
● Having to return the car to the same pick-up location is a deal-breaker in 89% of the cases. If
Car2Go found a way to economically pick-up cars from one-way trips, or have a way to
centrally command and control the fleet, that would be ideal and bring in thousands more in
revenues
● Startups and mid-sized companies could be a great target as they’re more willing to take risks
on new initiatives. Entering larger corporations would mean going after mid-managers who
are not already beneficiaries of car leases and would therefore not have to give up a benefit—
rather, they would feel that they’re gaining a benefit

Building upon these findings, we targeted the following 13 Israeli firms as a testing ground for a
Car2Go pitch: Dor Alon, Mega, AM: PM, Tamir Fishman, HOT, Netvision, Matomy, Pfizer, Teva,

29
Beitili, ISEF, Shekulu Tov and Techloft. From our preliminary research we wanted to focus on the
small- to mid-sized companies to test feasibility of pilot programs because it’s typically easier to
launch new initiatives with smaller firms which tend to be more entrepreneurial, and mid-sized
companies may be more likely to need the cost-savings while not be locked into a relationship with a
big car service provider as they’re seen as “small fish” to the Hertzes and Avises of the world.

In speaking with corporate representatives, we found the following:

● Executives will not be willing to give up their cars
● Executives demand luxury cars, which Car2Go does not provide in abundance
● Offering Car2Go as part of a series of secondary benefits to mid-level managers who don’t
already get car leases is an excellent way to pilot the program and test whether it would gain
corporate acceptance at no risk to the host company
● Young professionals would be more willing to try this out
● Car2Go must increase its hybrid or electric car vehicle options in order to be seen as a truly
green solution

Further, some company-specific findings include more detailed insights. For example, in Dor Alon’s
AM:PM we found a unique aligning of the brand with Car2Go.
 Since both Car2Go and AM:PM operate in highly urban areas, targeting a young clientele,
and want to maximize the overnight hours for deliveries and merchandizing, Car2Go’s 50%
off overnight solution may be an excellent selling point
 We discovered that the 24/7 convenience store chain uses only 3-4 light trucks (which
Car2Go owns) and makes spot deliveries on-demand, making it the ideal client for Car2Go

From Beitili, we learned of the costs some companies incur while using a hybrid offering for their
employees—offering car leases for their executives and subsidizing subordinates’ bus passes. At
Beitili, the points of interest were:
 Saving between 700-1,400 NIS in taxes for their employees, who pay anywhere from 2,000-
3,000 NIS monthly for a leased vehicle.
 Saving the company 300 NIS per employee, per month—or 90,000 NIS monthly (the
company employs 300), 1,080,000 NIS annually—for those who qualify for bus passes

30
Techloft took us on a journey through the startup space. We targeted the incubator since we know
that startups are low on cash and wanted to bring an element of CSR to the project—pitch the C2G
option at a discounted price to the incubator so that entrepreneurs can use the vehicles to get to
meetings, get the funding they need, and then use Car2Go for their other transportation needs. While
Techloft was interested in our proposal, the incubator is, itself, in its preliminary stages and not yet
ready to hear a pitch, but promised to stay in touch once it reaches the second stage of its
development and raises enough money for a fund where some of the discretionary money can be
diverted to transportation costs.

Our meetings with Tamir Fishman were perhaps the most illuminating. Here we confirmed our base
assumptions (mentioned in the key findings above)—which we then went on to verify with every
company we spoke with—and also learned of a suggested pilot program (see section 5).

While Car2Go gave us the option of pitching both its patented technology and its services, all
companies were interested in the service arm of the business. As the HR lead from TF put it, “you
can’t ask an executive at a top firm to always be ready to lend his car to someone who needs it.”
While she saw the benefits of car-sharing, even down to the Shekels and agorot of the tax savings,
she said her group of executives would not be willing to pool their cars into a fleet.

The major pain she identified with current car lease provider Hertz were:
● Customer service leaves a lot to be desired. Any time there’s an issue, customers have to wait
a long time for a response. Money isn’t managed well, etc. This is unacceptable for TF,
which serves top-notch execs
● There’s a sense of being over-charged for minor issues, i.e. a scratch costs hundreds or
thousands of NIS to fix. Any minimal problem costs a lot of money to repair and the issue of
pricing fairness comes up a lot

Besides giving us this valuable feedback, this specialized company also shed light on what clients are
looking for once they sign on the dotted line:
● Customer service must be top notch. Car leasing companies have a bad reputation of
charging for every little scratch and this is an area where Car2Go can differentiate itself

31
● Have designated representatives handling top clients’ needs. When a high-end corporate
customer calls, Car2Go has to be able to drop everything and address their concerns, no
matter what
● Make sure that available inventory matches demand

32
 Chapter 16: Corporate Social Responsibility

The question of CSR is an important one and in the case of a startup—and emerging company—the
issue revolves around when do we implement CSR initiatives? According to Milton Friedman, the
first obligation of a business is to make a profit for its shareholders17, anything else amounts to a
form of taxation. However, since we live in a society, there’s an expectation that companies give
back once they hit a certain threshold of profitability.

Car2Go has maintained that its approach to corporate social responsibility is in its green proposition.
The company claims that every one of its vehicles serves 30 drivers and has the effect of taking 15
cars off the road18. The company further maintains that renting a car by the hour means that
consumers are more likely to consider the purpose of their trip and think twice before embarking
upon it. This means that 70% fewer rides happen on cars that are shared.

Yet despite all these promises of a greener tomorrow and a smaller carbon footprint, potential
corporate partners are reticent to endorse Car2Go with the green stamp of approval as the company’s
fleet of hybrid and electric vehicles currently accounts for only 3% of its total offering.

This will immediately boost the company’s credibility to those seeking a green alternative. After all,
according to Max B. E. Clarkson, Corporate Social Performance can be evaluated more effectively
based on the corporation’s relationships with its stakeholders, as opposed to using any models or
methodologies19. By listening to its green constituency, Car2Go shows that it is ready to be an active
participant in the battle to save the planet and fight to end our dependence on fuel.

To that end, the company has to do more in order to fulfill its role as a good corporate social citizen.
In order to boost our business, we suggest taking a note from Michael Porter and implement a shared
value CSR initiative that aligns with Car2Go’s core values20.

17
Friedman, The Social Responsibility of Business Is to Increase its Profits
18
http://www.car2go.co.il/giv/index.php?option=com_content&view=article&id=50&Itemid=56&lang=en
19
Clarkson, A Stakeholder framework for analyzing and evaluating Corporate Social Performance
20
Porter and Kramer, Creating Shared Value, 2011

33
With “Road to Work” we recommend:
 Car2Go team up with strategic partners to sponsor driving lessons for people in
underprivileged neighborhoods regardless of ethnicity or religion
 The primary purpose of this initiative is to teach people a vocation that leads them to find
driving-related jobs. Car2Go’s strategic partners will be key in helping with employment and
placement options
 Secondary benefit of this initiative will be better road safety, better relationships between
Car2Go and strategic partners, better brand awareness for Car2Go—and the creation of a new
customer base for Car2Go as these newly employed people become customers

By embarking upon a CSR program that aligns with Car2Go’s core values, the company will be able
to grow its appeal to consumers by showing that it values the environment it operates in, that it cares
about those less fortunate, that it understands how it can have an impact on the economy by training
people for jobs and helping find positions for them, and by serving as a consumer good option once it
places its graduates in well-paying positions, enabling them to become contributing members of
tomorrow’s economic society.

34
 Chapter 17: Conclusions, Recommendations and Summary

There’s a clear need in the market for Car2Go’s services. We believe that if the company chooses to
implement our coupon-to-adoption method it can test the arena at minimal risk. Currently the B2B
market doesn’t see car-sharing as a solution it can use as part of its infrastructure framework. That’s
a bias that Car2Go will have to overcome—one client at a time. A successful implementation with a
key partner, such as Tamir Fishman, AM:PM or Beitili would go a long way toward validation by
other companies and would increase demand for Car2Go’s service.

Building this demand around rising young professionals is the most organic path to growth. They’re
already open to the idea of car-sharing and have fewer demands than executives who have been
driving their own luxury vehicles for years. Younger professionals are also more welcoming to pilot
programs, coupons, and experiments.

Additionally, implementing a CSR initiative would generate fresh buzz and press that would renew
interest in the company for all the right reasons. Right now, the B2B market doesn’t see Car2Go as a
viable green solution. While customers recognize that a limited percentage of the fleet runs on hybrid
cars, the complaint we heard most often is that it’s not enough. In order to be seen as a serious player
in the green space, Car2Go must immediately increase its ownership of hybrid and electric vehicles.

Finally, making it in the B2B world takes more initiative than it does in the B2C world. While so far,
Car2Go has been able to rely on its cool factor when it came to generating leads, businesses expect to
be pitched and courted. In order to maximize the pitch directions and market segmentation we’ve
provided, we highly recommend that Car2Go target 10 companies per year to go after, actively
pursue them, use our questionnaire if necessary, and tailor an offer. If they succeed in closing a few
deals per quarter, we feel like they could be self-sufficient in their road to growth. Otherwise, they
would need additional sources of private investment.

There’s no question that Car2Go needs to embark upon a new market or a new product in order to
grow its revenues and appeal to new customers. We believe that by tapping into the B2B market,
Car2Go will discover that it has a ready and willing new driver base happy to contribute to its bottom
line.

35
 Chapter 18: Appendixes (including supporting docs and resumes)

 Our Prezi presentation:

http://prezi.com/m0bxq0tgdkrr/car2go/

 Additional source for Business Plan formatting: David Zilichovsky’s “Elements of a

Business Plan”

Our questionnaire:
1. What solution do you have now?
2. What do you like about it?
3. Who do you currently offer a car solution to in your company?
4. What differentiation do you have, if any, between different users?
5. What is your ideal transportation solution?
6. Do you use the vehicle benefit to recruit and retain employees?
7. Do you keep a log or a management system of fleet and different users’ consumption and
mileage?
8. How costly is your current car lease/taxi/bus plan?
9. Go over the C2G Plan
10. How would you tailor it differently to fit your needs?

36
Takeaways from Car2Go’s Sales Calls:
● Moving is an unexplored potential business area
○ problem: those consumers don’t become regular C2G customers and they’re usually
interested in a one-time solution to a unique problem
● Overnight businesses can save 50% of the hourly/KM price by reserving after 23:00. This
could be good for:
○ bakeries
○ retailers who receive goods overnight to restock their floor
○ newspapers
○ Any other industries
● Customer objections tend to be over price. Car2Go overcomes that by asking for a
comparison benchmark
● This is all about getting to know the customer and all info/data is customer-generated. This is
not a PUSH
○ All calls are generated by leads, not cold calls
○ Questions include: where in Israel are you based, what is the nature of your trip, how
often will you need a car? Based on the answers, Car2Go tries to come up with the
right parameters to fit the customer needs. There’s no desire to oversell because that
way the user is unsatisfied and leaves the service
○ Emphasis on the fact that this will NOT replace a rental car, a train ticket, or a plane
ticket. This is just ANOTHER tool in an arsenal of tools that can be a viable solution
on a needs basis
○ From the lead-generation tool that is proprietary to Car2Go, 25% of people become
members, 35% become drivers. In-person inquiries show a conversion rate of 95%

37
Contact information for Companies we spoke with:
Tamir Fishman
Sivan Shapira- Operations & Welfare Manager. Tel: 03-6849340. Cel: 054-6530400. Email:
sivans@tamfish.com

Dor Alon/AM:PM/Mega
Nissim Shavit- Environmental Section Manager, Projects Manager, Dor Alon. Tel:
046321206. Mobile: 0545438011.
Email: nissim.shavit@doralon.co.il

Betili
Renana Medina- HR Manager*. Tel: 03-9536428. Cel: 052-2309024. Email:
renana@betili.com
*This contact has only agreed to participate in the project as an educational sample and
has not agreed to discuss further business with C2G.

Shekulu Tov
Arik- CEO. Cel: 050-2090378. Email: arik@s-tov.org.il

Netvision/Celcom
Sharon Shuri- HR Manager, 013 Netvision. Cel: 052-3133934. Email:
sharons@013netvision.co.il

HOT
Avishay Damari- HOT HR. Tel: 077-7077057. Cel: 054-7077057. Email:
Avishay.Damari@hot.net.il

Matomy
Shir Ross- Account Manager, Publisher Key Accounts, Matomy Xtend Media. Tel: 077-
3606145/ Cel: 054-7945920
Email: shir.r@matomy.com

38
ISEF
Shai Zamir. Cel: 052-5841177
Email: shaizamir5@gmail.com

Techloft
Gilad Tuffias- Founder. Tel: 050-5475540
Email: gilad@techloft.co.il

Pfizer
Inbal Goren. Tel: 09-9700500
Email: Inbal.Goren@Pfizer.com

Teva
Natalie Kamil- Israel Compensation & Benefits. Tel: 03-9148958. Cell: 054-8885073
Email: gilad@techloft.co.il

39
40
Our SWOT Analysis:
STRENGTHS
 Recognized brand, perceived as young hip
and sexy
 Patented door opening technology
 Methods of marketing that include a personal
and business approach
 Diverse vehicle offering in fleet
 Location in key big cities that allows
functionality success
 Specialized parking spaces
 First mover advantage, establishing car
sharing business in Israel
 Strategic financial back up through the
support of the Tamir Fishman group
OPPORTUNITIES
 Reliance on lead generation sales system
prevents proactive pitching
 Market not educated enough about benefits
of car sharing
 Capitalizing on tax benefits of car sharing vs.
car ownership/leasing
 Tel Aviv’s government hasn’t defined which
vendor they will utilize for citywide for
municipality car project.
 Lack of penetration into B2B markets
41
WEAKNESSES
 Not yet operationally profitable
 Business model forces drivers into
two-way trips
 Company is stuck in a startup
mentality despite being in a more
mature phase
 Not enough luxury vehicles
 Not enough hybrid/electric cars,
while appealing to green conscious
market
 Lack of customer segmentation
 Corporate strategy is unfocused.
THREATS
 Competitors forming strategic
partnerships (i.e. Better Place and
Eldan)
 Customer perception as an
expensive service
 Major corporations favoring a car
leasing culture in Israel
 Growing number of alternatives
 Growing reach of public
transportation
Our Ansoff model

Ansoff Current Products New Products

Model

Current Market Penetration Product Development

Markets
 C2G is already implementing
marketing efforts
 Market is relatively saturated
with competitors. Where’s the
benefit in further saturating it?
 Only new place to enter into is
new markets (see bullets below)
 Market demand indicates that
current markets would benefit
from new offerings in luxury
market and commercial market
 New features such as pick-up here,
drop-off there, would increase
business.

New Market Development Diversification

Markets
 No need for investment in new  Highest risk
products  Niche demand for luxury vehicles
 Partnership with strategic within new market but no proof
partners means higher visibility that it will lead to fast profits
at lower risk  High upfront costs
 Potential customers may be more
willing to sign on if their
companies implicitly endorse the
service

42