Shohoz plans to go big with $15M investment. Can it keep up?

Shohoz rides, the latest addition in the ride-sharing industry of the country, has pulled in $15M worth of investments as a part of its round B investments. Singapore based Golden Gate Ventures led the new investments round. Linear VC of China, 500 Startups and Singapore based angel investor Koh Boon Hwee were also associated with this investment.

With this investment, Shohoz rides becomes one of the heavily invested in businesses in the country and looks steadily set in their goal of expanding their services in the future. Shohoz’s closest rival, Pathao, has also recently raised $10M investment from Indonesian ride sharing giant, Go-Jek.

Steady growth

Shohoz raises $15M
Shohoz started with online bus ticketing

Shohoz has remained a trusted name in online sales for bus tickets since 2014. After its initial success, it soon expanded to selling ferry tickets and very recently, tickets for events and movies. After the ride-sharing industry in the country saw a boom in the latter half of last year, Shohoz started out its ride-sharing services, Shohoz rides, this year in January.

With its ride-sharing services rapidly gaining traction, it does not, however, mean that the platform will move away from its bus ticketing services. “Bus tickets will remain an important part of our business, [there’s] lots of synergy with ride-sharing,” she explained in an interview with Techcrunch. “Dhaka has a super dense population with bad infrastructure. If anything, there’s a better case for ride-sharing than Indonesia. There’s no subway and transport is a horrid nightmare.”

Shohoz started its ride-sharing services by adding motorbikes to its platform. It recently added cars to it and hopes their overall service will ease the traffic situation in the capital city.

Keeping its feet on the ground

Shohoz raises $15M

Despite having shown promising prospects, Shohoz has apparently been taking things slow. It hasn’t yet shown any initiative to grab iOS users in the country but recently underwent a massive rebranding to appeal to new customers. It is unclear if they’re planning to launch an iOS app any soon.

Shohoz plans to tap into the groceries and food delivery market soon. It aims to model itself after the “Super App” style most southeast Asian tech giants usually go for and something Pathao has recently ventured into.

It doesn’t plan to go global anytime soon but is surely set to expand its services outside the capital city of Dhaka, as explained by the CEO in a recent interview.

Is three a crowd?

Shohoz raises $15M

Currently, three ride-sharing platforms, including Shohoz, are doing steady business in Bangladesh.

Pathao has skyrocketed with its constant influx of investment, aggressive market attitude and expansion beyond the country. Uber, although lagging a bit behind in the local market in comparison with Pathao, is on stable grounds. With its UberEats service soon launching in Bangladesh, its competition with Pathao is not dying down any soon either.

Can Shohoz keep up with aggressive Pathao and international giant Uber with its laid back but organised market strategies? So far, they’ve been doing good for themselves. Only time will tell what the future holds for this ride-sharing rising star.

Pathao is going global! Launching services in Nepal on 15 September

Pathao, popular Bangladeshi ridesharing and logistics service, is set to launch its services in Nepal. They confirmed long-standing speculations through social media posts. The startup has also been actively hiring employees in Nepal using online job vacancy platforms like Merojob (as reported by a Nepal based tech news site). This is the first time a locally grown ride-sharing platform is expanding beyond Bangladesh’s borders.

Humble beginnings

Pathao was founded in 2015 by Hussain Elius, Shifat Adnan and Ahmed Fahad. The early days involved bootstrapping from a small office in Banani and being a consumer-facing on-demand delivery service. That expanded to ride sharing and food delivery. Their latest venture goes into cashless payments, demonstrating their aspirations to create a full ecosystem. Launching in Nepal said to be the first stage of Pathao’s planned global expansion.

Nepal ride share
Nepal already has quite a few ride-sharing platforms like Tootle and Sarathi.

“Pathao has built a platform that enables employment for thousands of drivers and a product that millions of customers use in Bangladesh. We are excited to take our Pathao platform internationally – starting with Nepal. We have already started to get riders on board in Nepal, and plan to launch in the next few weeks. The Pathao team is inspired to be #MovingNepal and working closely with the local ecosystem,” said Pathao CEO Hussain M Elius.

Pathao has competition

Nepal already has a few ride-sharing platforms like Tootle, Sarathi etc. However, Pathao believes it will be a strong contender once it gets a foothold in the local market.

“The Pathao team is inspired to be #MovingNepal and working closely with the local ecosystem,” said Pathao CEO Hussain M Elius.

Global investors seem to share this conviction in Pathao’s potential; Pathao is one of the country’s most invested-in startups. In November 2017, Indonesian ride sharing giant, Go-Jek, reportedly invested around US$ 2 million as part of its Series A funding.  This was followed up by raising another round of investment at a valuation of over $100 million in April this year.

“Pathao will be launching its ride-sharing service at first in Kathmandu and gradually move on to its other services like food delivery and cashless payment,” said Sayeda Nabila Mahabub, Lead Marketing Manager of Pathao in a recent conversation with HiFi Public.

Growing fast, moving safely

Pathao is also facing increasing concerns about the safety of the millions of people they are moving. In order to ensure ensure the safety of its riders and passengers, Pathao is running the #MovingSafely campaign. Initiatives include distributing two sets of helmets for its registered riders. Additionally, the ride-sharing service introduced an insurance policy for its users. Pathao is expected to maintain these safety policies in Nepal, as well.

“We want to create a safe ecosystem to solve everyday problems, starting with traffic and transportation,” said Kishwar Hashemee, Vice President of  Pathao, about its expansion in Nepal.

Pathao will have a soft launch in Kathmandu on 15th September. They will go into full operational capacity from 1st October 2018.

Uber in the deep waters of South East Asia

It’s no secret that Uber has been the pioneer for ride-sharing apps. In Bangladesh, Uber’s biggest competitor for ride-sharing is Pathao. Uber might have started back in 2009, but its competitors weren’t too late to start. In its markets, Uber has to compete with companies such as Lyft, Didi Chuxing, Ola, and Grab.

It’s all over the news if you haven’t noticed it. Uber just sold its massive market in South East Asia to Grab; a local ride-sharing app. Why on God’s green earth would a Fortune 500 company sell to a “puny” South East Asian company?

Models stand beside Grab cars during the launch of the ride hailing-firm’s services in the country, in Phnom Penh on December 19, 2017. Southeast Asia’s top ride-hailing firm Grab launched services in the Cambodian capital Phnom Penh on December 19, as it looks to lock down regional domination against main rival Uber. /AFP PHOTO/Charly TWO

Grab isn’t as mature as Uber. It’s journey started three years after Uber in 2012 when Anthony Tan and Tan Hooi Ling, two Harvard classmates decided to enter the massive market of ride sharing in Malaysia; Anthony quitting his position as head of marketing in Tan Cheng Motors, a family-owned business and Ling quitting her job as a consultant in McKinsey & Company. Eventually it moved to Singapore, Phillipines and Thailand and today, the app has 3.5 million daily rides.

One would think that Grab, acquiring Uber’s market, would create a monopoly in South East Asian market for Grab; But Go-Jek, the fastest growing start-up in South Asia from Indonesia, decided to penetrate the market by expanding into three more countries as the CEO, Nadiem Makarim thinks that it’s a great opportunity as there are fewer players within the landscape. Planning to expand into three more countries, an internal e-mail from Go-Jek specified that it aimed to set up it’s operations within Philippines within this year.

People may not have noticed it, but Uber is in deep waters for the worst of reasons. Last year, Uber sustained a $1.5 billion loss. Ironically so, because no other startup in history has raised more capital, operated globally and reached quite a lofty valuation as Uber.

Amidst a hailstorm of controversy, Uber’s former CEO resigned and was replaced with Dara Khosrowshahi. Dara understood that the Uber’s biggest market had little room for expansion, thanks to other services such as Lyft and Grab. Right after taking up the throne, Dara mentioned that the market in South East Asia might not see a better future, at least for the next six months.

Selling businesses in markets isn’t new for Uber. Back in 2016, Uber sold a majority of its operations in China to Didi, the latter acquiring a market of around $35 billion dollars. Why and how is this relevant? Sure, Pathao isn’t going to eat up the ride-sharing market in Bangladesh anytime soon. In fact, Uber’s bike ride sharing service, Uber Moto, caught up quite early. But Pathao is expanding to regions Uber Moto still hasn’t moved into. It’s fairly easy to say that micro-management isn’t Uber’s strong suit, and local startups are taking advantage of it. As a result, ride-sharing services around the world are currently engulfed in wonderful, chaotic anarchy, with an aim for national domination.

It is expected that after this move, Uber is trying to concentrate in its North American market – aptly so, as Dara previously worked for Expedia Inc., another company based in the US. But the market in the US isn’t settling down anytime soon, as Lyft’s plans for expansion is in order as well.

Uber is doing pretty good where it matters, and it’s nice to see that the new CEO acknowledges that holding its ground is more important than aggressive expansion. But innovation is what keeps tech companies alive, and while Uber might have plans like autonomous driving, those plans took a hit as the autonomous Uber project was recently banned in Arizona following a fatal crash.

One good thing Uber still has are its investors who are sure of its success even after the monumental losses suffered in last year’s third-quarter. With it, Uber still has funds to pull itself up. What the world waits to see is how they plan to navigate themselves out of the way of the graveyard of tech startups.