Subject- Entreprenuership

Topic- Business Model on Cab-In

Submitted to- Dr Sheeba Khalid

Submitted By- Siddharth Pandey (A8111119135)
Course- BA,LLB (H)
Section- C
Semester- 9th
Introduction

The Cab-In business model is also known as a multisided platform business

model, as it connects drivers (offer) and passengers (demand), in order to offer
cheaper transportation and an additional source of income.

Cab-In is a technological platform that has revolutionized urban transportation

and has given taxi drivers and cab companies a lot of headaches. In short, it is
an app that connects drivers to users who need a ride, using a smartphone as a
tool.

Executive Summary

Cab-In is a ride-hailing company that connects riders with drivers through a mobile app. The
company's business model is based on a two-sided marketplace. On one side, Cab-In has
riders who are looking for a ride. On the other side, Cab-In has drivers who are looking to
give rides.

Cab-In generates revenue from two main sources:

 Ride fares: Cab-In charges riders a fee for each ride that they take. The fee varies
depending on the length of the ride, the time of day, and the demand for rides in the
area.

 Driver commissions: Cab-In charges drivers a commission on each ride that they give.
The commission rate varies depending on the city and the type of vehicle that the
driver is using.

In addition to ride fares and driver commissions, Cab-In also generates revenue from other
sources, such as food delivery and freight services. However, ride fares and driver
commissions are the company's primary source of revenue.
Cab-In's business model is successful because it offers a convenient and affordable way for
people to get around. Cab-In is also a popular choice for businesses, as it provides a
convenient way to transport employees and customers.

Here are some of the key benefits of Cab-In's business model:

 Convenience: Cab-In is a convenient way for people to get around. Riders can request
a ride with just a few taps on their phone, and the driver will arrive at their location
within minutes.

 Affordability: Cab-In is a relatively affordable way to get around, especially

compared to taxis. Riders can get a fare estimate before they request a ride, and they
can also see the estimated time of arrival for the driver.

 Choice: Cab-In offers a variety of ride options, including Cab-InX, Cab-InXL, Cab-
InBlack, and Cab-InSUV. This gives riders the flexibility to choose the ride that best
meets their needs.

Cab-In's business model is a successful example of how a company can generate revenue
from providing a convenient and affordable transportation service. The company is well-
positioned to continue its growth in the years to come as more and more people use ride-
hailing services to get around.
Cab-In’s Business Model

Cab-In’s Customer Segments

In general, Cab-In has two customer segments riders and drivers. The side of riders is people
who either do not have their own car, need to travel outside their city of residence, or don’t
want to drive at a certain time — for example, when they know they will consume alcohol at
a party, concert or celebration. And the side of drivers are those people mentioned above,
who are probably out of the market or need some extra money, and may start a new job just
by driving and using an app.

Cab-In’s Value Propositions

For customers, the greatest value proposition is the convenience of not having to look for a
taxi — the car comes to you. Cars are available 24/7 and their route can be tracked. In
addition, fares are generally lower than those charged by taxi drivers, and the rider can
estimate how much the ride will cost before calling the driver. For drivers, it is a source of
income (main or additional), a job that doesn’t require experience, with flexible working
schedules and easy access to passengers. Plus, let’s not forget that the passenger informs the
destination on the app, which avoids misunderstandings when we are talking about people
who do not speak the same language, which is a positive point for both sides.

Cab-In’s Channels

Historically, in those ten years, the biggest channel for accessing customers was word of
mouth. In addition, the other widely used distribution channel has been social media. And, of
course, the app stores, where riders and drivers download their Cab-In apps.

Cab-In’s Customer Relationships

The customer relationship involves three sides: customer, driver, and regulators. Cab-In’s
focus is predominantly on the customer. If the company has no credibility with the end-user,
then it has no reason to create a relationship with the other two. Transparency regarding time
and prices, as well as confidence in security and privacy, are essential here. Cab-In’s second-
largest customer is its own driver. Since the driver is not an Cab-In employee and their
vehicle is not Cab-In’s property — even though there are several lawsuits around the world in
this regard —, the company needs to offer them attractive working and payment conditions to
keep its business running. As for regulators, Cab-In seeks compliance and responsibility
within the law, within a threshold that also allows it to obey the laws of the market itself.

Cab-In’s Key Resources

Cab-In has two key resources: 1) The platform that connects drivers and riders, with a focus
on continuous improvement of its resources and algorithms, and 2) The Cab-In brand itself,
which is used in all cities where the company operates.
Cab-In’s Key Activities

Cab-In’s two key activities are: 1) Developing and maintaining the app (and its algorithms),
and 2) Maintaining and improving engagement between riders and drivers. In order for these
activities to work, its key activities also include marketing, communication between the
parties, customer service, and more.

Cab-In’s Key Partners

Cab-In’s most important key partner is its driver, without whom the company doesn’t reach
the final customer, doesn’t deliver its value propositions, and therefore doesn’t produce
revenue. They are the supply side of the chain. Other important key partners are the investors,
that allow the company to develop and reach other levels of performance. They bring the
initial rounds of funding to develop the app, algorithms, and new proposals, such as
driverless cars. Of course, this revenue is also used for other expenditures. And, last but not
least, technology providers, with GPS, payment, communication, cloud storage, and data
analytics systems, among others.

Cab-In’s Cost Structure

The cost structure of Cab-In is all about maintaining the platform and marketing to acquire
new customers (Customer Acquisition Costs — CAC). In addition, there are legal costs,
credit card fees, insurance, research and development investments, customer support, and
more.
Cab-In’s Competitors

 Lyft: This is the major competitor. Founded in 2012, the company provides
services throughout the U.S. and in more than 220 cities, providing 18.5 billion
rides per month. It went public at a $24 billion valuation;

 Curb: Owned by VeriFoneSystems, the company uses its systems and credit card
machines for operation. Launched in 2015, Curb operates most of New York’s
green and yellow taxis and aims to reach all the major cities in the U.S.;

 DidiChuxing: Launched in 2009 and already one of the largest companies in

China, it offers services such as DiDi Chauffeur, Didi Test Drive, taxi-hailing,
DiDi Minibus, and DiDi private car rental through its app. In 2015, the company
reached 1.4 billion rides and its valuation was $28 billion in 2016;

 OlaCabs: It began in Mumbai, in 2010, as an online taxi aggregator. Now, the

network reaches Australia, New Zealand, and the UK, and its valuation surpassed
$5 billion in 2015. Currently, Ola has a more than 60 percent market share in
India;

 Grab: Founded in 2011, in Singapore, the company also offers services in the
Philippines, Indonesia, Vietnam, Thailand, Myanmar, and Malaysia. At the end of
2016, Grab introduced a messaging service on its app that allowed language
translations, helping break this barrier in Asia;

 Cabify: Launched in 2011 in Spain, it is considered the most secure in the

industry, with modern vehicles, expert drivers, and geo-tracking. The company
operates in Spain, Mexico, Chile, Brazil, Peru, Argentina, and Portugal, among
other places;

 Yandex Taxi: This Russian company offers ride-sharing and food delivery
services in the Middle East, Russia, Eastern Europe, and Africa, and is also one of
 the world’s leading companies developing self-driving vehicles. The company
completed 1 billion rides by the end of 2018, performed by more than 700,000
drivers;

 Local taxis: Every major city in the world has taxi spots, generally near stations,
terminals, airports, and hotels. The advantage of taxis is the possibility of
negotiating prices directly with the clients.

Cab-In’s SWOT Analysis

Below, there is a detailed SWOT Analysis of Cab-In:

Cab-In’s Strengths

 Global reach: Cab-In is a worldwide company, making it the most recognizable

brand in the industry, since it operates in 85 countries;

 Convenience: Cab-In is accessible to anybody with an internet connection and a

smartphone. The app is easy to use, offers interaction with the drivers, provides
several payment methods, and is usually cheaper than regular taxis;

 Pricing: The company uses multiple variables to determine the price of a trip, also
bringing more advantages for the drivers;
  Operating structure: Cab-In doesn’t have employees, which allows the company
to invest much more back in the business and R&D;

 Brand: Cab-In has the widest coverage in the industry, was the first one to be
launched, and also had a lot of attention from the media.

Cab-In’s Weaknesses

 Lawsuits: Cab-In has been involved in many lawsuits which have been affecting
its image and reputation;

 Regulations: The company has a history of problems with governments regarding

regulations and laws of the taxi industry;

 Sustainability: Cab-In does not have internal policies to minimize the impact on
the environment;

 Transparency: As it is a private company, Cab-In does not need to open up its

finances, but this lack of transparency puts in check whether they are investing in
R&D or others;

 Safety: Like any other transportation, Cab-In riders are subject to robbery, abuse,
and other safety issues;

 Internet dependence: It relies on the internet and smartphones to run, but the
majority of emerging countries still face difficulties in those matters.

Cab-In’s Opportunities
  Expansion: Cab-In has a huge opportunity to expand into new markets around the
planet;

 Diversification: The company has already added food delivery to its services, but
it can still diversity its business and offers, especially niching down to categories
of transportation, for example;

 The number of drivers: Whether it is a result of an economic crisis or not, the

company has been able to attract many drivers. This increases the offer for cars,
which pleases the consumers, thus raising the number of regular users.

Cab-In’s Threats

 Competition: The high level and rising number of rivals may jeopardize Cab-In’s
expansion, thus making it difficult to grow as planned;

 Margins: Cab-In keeps low rates that result in low margins. For example, it has an
80% market share in Brazil, but it is still unprofitable there;

 Regulations: Governments may impose strict rules that can endanger Cab-In
businesses in many countries.
CONCLUSION

The success of Cab-In’s business model is very clear from the fact that you will rarely see a
user comparing prices on their mobile before ordering a ride. They will simply open the Cab-
In app and enter their destination. In addition, the company has had a very positive response
from the population, especially in locations with employment problems, as it offers a new
possibility to several people who are not working.

Any entrepreneur can draw several “lessons” from Cab-In’s business model. For example,
you don’t need large equity to start a business. Cab-In doesn’t even own a car and, still,
provides over 1 million rides a day. More than that, its founders saw a problem in an industry
and simply sought a solution for it. And in doing so, they were able to transform the cab
industry.

Finally, two of the biggest entrepreneurship classes you can take: 1) Treat your workforce as
partners, and 2) Expand one step at a time. Cab-In started with cars and is already operating
with bikes, boats, and even helicopters!