Telecoms.com: Hi Alon. You’re uniquely placed to tell us about Uber’s African growth, but I’m curious to know, first of all, what the general protocol is for launching Uber in a city?
Alon Lits: When Uber launches in a city, they send out what we call the Uber international Launch Team. Their objective is to get things up and running, and that means a few things. First of all, it means getting supply on the roads and ensuring we have partners who are active and available for pickups through the application. Then it’s about generating that initial buzz around Uber on the demand side – creating that initial brand awareness and excitement in the city. The final and probably the key objective is to hire the local team.
I think that’s probably one of the main reasons Uber has been successful: when we launch in a market, it’s very important that the team operating in that market is made up of locals who understand the local dynamic and are in touch with the city. The team as set out initially is three people: a general manager, a driver operations manager, and a marketing manager.
When Uber operates in a market, we want to ensure that our partners can operate in some form of legal framework. This can prove a challenge because in most cases you’re dealing in an environment where regulation is lagging behind innovation. It’s about identifying the category which would most closely fit the way that Uber partners operate, engaging with policy makers and ensuring that the partners we work with have a clear route to licensing.
You were previously general manager for Uber in Johannesburg, what specific challenges did you come up against launching there?
This may sound obvious after the fact, but something which wasn’t really considered going in was that, if you are dealing with a market like London or the US, most drivers which come on the platform have been using smart phones in a personal capacity. When they go through the training process it’s not so much getting them comfortable with how to use the smartphone, it’s more about how do you use the Uber application, whereas in Johannesburg and South Africa we had to take a step back. In a lot of cases, drivers we were working with were using the smartphone for the first time. We had to add an additional module into the training process on using a touch screen – a lot of people were using it for the first time, and were not familiar with that.
How do you make smartphones available and affordable to prospective drivers?
What we’ve done in South Africa is, we provide a smartphone on lock down, and the only thing that individual can do with the smartphone is access the Uber application. If we had to charge the individual a full amount for that phone it could be a barrier, but there’s a way to deduct, through the platform, a security deposit, which is paid over a period from the fares the driver earns on the platform: there’s zero outlay up front, and then a small cost for the data cost associated with that devices for that period.
Then, if the driver for whatever reason decided to terminate their partnership with Uber, they return the device and we return the security deposit. Longer term what we’re trying to do is gain access to cheaper devices.
Tell us about the learning curve Uber has undergone in South Africa in relation to safety issues and concerns?
Obviously safety is something that’s core to Uber everywhere we operate. Looking into South Africa, a thing we identified early on was that, to become a professional driver, you needed to obtain something called a Professional Drivers Permit. In order to obtain one of these, there is a criminal background check, but what we found – and we identified this is early 2014 (relatively soon after we launched) – is that there were drivers coming forward and looking to partner with us with a Professional Drivers Permit who actually had some form of criminal hits against their name, despite having gone through a process in which they were theoretically checked for a criminal record.
In response, we introduced an additional criminal background check to ensure we could go above and beyond the regulatory requirement to ensure we could connect people to some of the safest drivers on the road, and that would be true everywhere across the continent.
Ultimately, though, technology built into the Uber application brings unprecedented levels of safety for users. You can see your driver’s name and identify before you take the trip and you can share that information even with someone not travelling with you. That means that, even when you’re travelling alone you’re never travelling alone because someone can monitor your trip remotely. Safety features in the application such as this have addressed a lot of the concerns that people had about using public transport across the continent. People feel safer knowing that the checks are in place and that everything’s on the record and they can share that information.
Another important feature is that you can actually rate that driver at the end of the trip , and the feedback rating goes both ways, so drivers can rate their riders and if they have riders that are rude or aggressive they can rate that and we can actually ban riders from the platform.
What can you tell us about Uber’s wider continental ambitions for Africa?
One important point is the challenges we face in South Africa are different to those we face in Nigeria and those are different to the ones we face in Nairobi. Nairobi became the second city within Uber to experiment with cash. We pride ourselves on the fact that the experience is seamless and everything is processed directly through the application, but at the same time when you have a constraint in a market where credit or cheque card penetration is very low you do need to adapt to that to overcome those barriers.
In the short term it’s really about identifying those local challenges. We want to bring Uber to every city in the world where there’s a population of more than 200,000 people. The opportunities in Africa are outstanding. The product may not be the same in every market but there are definitely huge opportunities – not only an emerging middle class but also huge numbers of young consumers across the continent. We get a lot of inbound requests about where are we going to be next, what city and when. It’s just about tweaking the model to ensure it’s right for the continent and then growing from there.
Finally, you’re appearing at appsworld Africa (17 & 18 November 2015) in Cape Town this year. What’s the motivation for attending?
I’m excited to be a part of the event, and very keen to engage with developers across the region. A trend I’ve seen lately is that African developers are increasingly thinking beyond their home markets and are really good enough to take on the rest of the continent and in some cases the world. It’s fantastic to see that innovation and entrepreneurship emerging.