BlaBlaCar: meet the ‘idealists’ who are set to change how the world travels
Paris-based long-distance ride-sharing startup BlaBlaCar announced a $100 million Series C funding round led by Index Ventures today. As part of the round, Index’s Dominique Vidal and Martin Mignot will be joining the board. Here, Dominique and Martin explain why Index is so excited about what lies ahead for the company.
The best consumer companies tend to be the simplest. They do one thing particularly well. So well, in fact, that its customers soon take them for granted, and forget that they ever lived without them, and that the premise the company is based on, was once viewed as unthinkable, even slightly ridiculous. BlaBlaCar falls squarely into that category.
The best entrepreneurs don't start companies, they launch movements
Their former INSEAD classmates will privately admit, that when Frederic (CEO), Francis (CTO) and Nicolas (COO) came up with the model for BlaBlaCar in 2007, they were widely seen as a bunch of "doux-rêveurs" – idealists, whose project to enable strangers to meet through the Internet and share their car journeys, was more akin to a form of lunacy than a serious business endeavour.
But fast-forward seven years, and against all odds, this ‘wacky, hippie’ platform has turned into one of the fastest-growing businesses in the world, and is well on its way to creating a new kind of people-powered global transportation network, from scratch, and at a fraction of the cost of the existing ones. Today, the value proposition is so clear that very few people would even think of challenging it.
BlaBlaBla = WinWinWin
By using the Internet to match empty seats with passengers, the company is creating a unique win-win-win situation: drivers recoup their costs, passengers pay less than they would otherwise, and society benefits from having fewer cars on the road. All the while, enabling users to meet new people and travel like human beings again (indeed the company name actually comes from a feature on the website, which allows users to define their chattiness according to three levels, from "bla" to "bla bla bla").
For passengers, benefits do not stop at unbeatable prices and good conversation. While the service will never be faster than high-speed trains, it is becoming increasingly more convenient as an option to move from a point A to a point B. Indeed, as the community grows and more rides are being offered (currently, 1 million members share journeys every month, 3x more than last year), the granularity of the pickup and drop-off addresses improves too, with ever-more precise routes attracting interested passengers.
At a wedding I attended in France recently, a guest mentioned he had used the service 40+ times in the past four years to take passengers from Paris to Vendée (pro tip: if a random non-geek person is publicly raving about a tech product they have been using monthly over multiple years, you know you are onto something massive). He described how the precision of the route he offered on the platform greatly increased over time: it started as "Paris to Vendée" and morphed, eventually, into "Massy-Palaiseau Train Station to Les Herbiers", with the exact same fill rate for his vehicle. At scale, the company will offer a perfect door-to-door experience - making it as convenient as driving one’s own car, yet without the cost and hassle.
To the next 7 billion members
But the most exciting aspect of BlaBlaCar is that it addresses a universal human need. People in every corner of the world want to travel from a point A to a point B in the cheapest, fastest, and most convenient manner. And in every corner of the world, BlaBlaCar's model is more cost-effective than any existing alternatives.
The company already operates in eleven countries and every one of them is growing by orders of magnitude faster than France did at the same stage. Russia gathered over 250,000 members in its first three months of operation. Turkey, Brazil, India, China... every market, no matter its size, is a potential next target. The opportunity is truly global, and probably even bigger in emerging markets, where the cost of car ownership is higher relative to disposable income. Rather than yet another business catering to the 1% of cash-rich and time-poor urban elite, BlaBlaCar addresses the needs of the remaining 99% of the world population.
It is therefore particularly fortunate that Nicolas, the driver of the internationalisation effort, is one of those rare "unicorn" entrepreneurs, who have totally internalised the fact that the world is flat, and that no market is too big or too complex to go after. He puts it this way: "I've seen too many companies tinkering endlessly with their product and their business model, while forgetting about the international scaling. But when you have a proven product on a couple of markets, your entire focus should be on scaling as fast as possible, because international expansion is much more costly and complicated than people realise and you should wire your entire organisation to obsess about it."
And Nicolas doesn’t just talk a good game: over the past two years, the company opened six offices outside of France and acqui-hired three local teams, which have been brilliantly integrated in the organization, while retaining their unique local culture. This is the kind of drive and execution one needs to build a global iconic company.
And to the next 10 years
Last, the need BlaBlaCar is addressing is not only universal, but also fundamental. Jeff Bezos has a great way of explaining how he thinks about Amazon's value proposition in the long run: "I very frequently get the question: 'What's going to change in the next 10 years?' And that is a very interesting question; it's a very common one. I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important of the two -- because you can build a business strategy around the things that are stable in time. ... [I]n our retail business, we know that customers want low prices, and I know that's going to be true 10 years from now. They want fast delivery; they want vast selection. It's impossible to imagine a future 10 years from now where a customer comes up and says, 'Jeff, I love Amazon; I just wish the prices were a little higher,' [or] 'I love Amazon; I just wish you'd deliver a little more slowly.' Impossible."
The same applies to BlaBlaCar: in ten years' time people will still want to travel from a point A to a point B (to visit their families for the weekend, to attend a conference, to sit an exam, etc.) in the most cost-effective manner. And in ten years time, we believe BlaBlaCar will still be the company offering the best solution to that most fundamental of needs.