Country’s biggest taxi-beckoning tech company, 99, in "hyper-growth mode"
Brazil ride-hailer set to hammer Uber
Brazil’s unemployment rate is near its record, but at the headquarters of ride-hailing app 99 it is nowhere in evidence.
The country’s biggest taxi-beckoning tech company is outgrowing its Sao Paulo office after just 17 months as it seeks to quintuple its workforce in 2017 to 1,000 employees. Backed earlier this year by Didi Chuxing, which this week made a major investment in Dubai's Careem, and Softbank, 99 is planning to expand into the rest of Latin America in the near future and is on the hunt for more capital - executives were recently in San Francisco digging around.
Even with a hefty competitor in Uber, the company sees no end in sight to the potential.
"I can’t even predict how big the market in Brazil will be," said 99’s head of legal, policy and communication Matheus Moraes at the company’s Sao Paulo headquarters. "We try to forecast, but we just can’t."
The new additions to the staff will help 99 to grow in a country with poor infrastructure and a meagre public transport backbone. Traffic in the biggest cities is intolerable, with trips sometimes taking five times longer than they should - for example, it can take three hours to get to the international airport, a 30km drive from the financial district.
"Mobility is a problem in Brazil," Mr Moraes said. "In Germany, for example, you don’t need a hailing service, It’s convenient, of course, but not problem solving. Brazil has indeed a problem to solve."
The five-year-old start-up is in "hyper-growth mode" and snagged the Didi investment in January after reaching out for advice. Softbank’s stake followed within months. Both are minority shareholders and Didi holds a board seat.
Currently, 99 has more than 200,000 drivers in 500 cities, and 14 million users in a country with a population of more than 200 million. That compares to - as of a year ago - Uber’s more than 50,000 drivers and 13 million users in Brazil. Over the past three months, 15 million Brazilians have taken an Uber, yet it still operates in just a fraction of the cities where 99 is present, having doubled in the past year to more than 60.
Brazil is Uber’s second-largest market after the US, said Guilherme Telles, general manager for Brazil. (Uber no longer operates in China or Russia, though it does own stakes in companies that do). The competition does not bother him. In fact he thinks it’s a good thing.
"Other players see things we don’t," Mr Telles said.
While Uber is growing in Brazil via its pool service, in large part due to areas such as the periphery of Sao Paulo where getting to public transport can be onerous, 99 is still studying whether to jump into the ride sharing segment. Its person to person car service is among its fastest-growing segments, with top company executives riding at least five times a month. They do not always let on about who they are, although Mr Moraes, if the passenger requests his opinion on the route, will confess since he does not really know his way around Sao Paulo.