Middle East Unicorn Swvl's Spectacular Rise and 99% Stock Tumble (bloomberg.com) 22
A SPAC merger brought a global "Uber for bus" startup to the Nasdaq just as tech investment was about to dry up. From a report: In July 2021 the world's tallest tower, the Burj Khalifa in Dubai, was briefly lit up in brilliant red, with animated electronic text scrolling up its height announcing "the Middle East's first $1.5 billion unicorn to list on Nasdaq." The splashy marketing was for Swvl, a company with lofty ambitions to become a hybrid of a ride-hailing app and bus service in cities across the globe. Twenty months later, the Dubai-based company's shares have dropped more than 99%. Its roughly $9 million market value is a shadow of the billion-dollar-plus valuation that once gave it so-called unicorn status.
A deal to buy Turkish transit company Volt Lines largely using Swvl shares fell apart in January. Once trumpeted by Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum as a symbol of the Middle East's startup spirit, Swvl Holdings has become another example of tech-sector overreach -- and how quickly investor money dried up once superlow interest rates went away. It also shows the perils of trying to build a business that straddles emerging markets vulnerable to currency shocks as the dollar rises. Swvl was co-founded in Cairo in 2017 by former Rocket Internet SE executive Mostafa Kandil along with Ahmed Sabbah and Mahmoud Nouh. The trio started the company as a solution for commuters who didn't want to rely on public transit but couldn't pay a premium for ride-share services. Their idea: buses and vans running along routes that users could book a ride on with an app.
A deal to buy Turkish transit company Volt Lines largely using Swvl shares fell apart in January. Once trumpeted by Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum as a symbol of the Middle East's startup spirit, Swvl Holdings has become another example of tech-sector overreach -- and how quickly investor money dried up once superlow interest rates went away. It also shows the perils of trying to build a business that straddles emerging markets vulnerable to currency shocks as the dollar rises. Swvl was co-founded in Cairo in 2017 by former Rocket Internet SE executive Mostafa Kandil along with Ahmed Sabbah and Mahmoud Nouh. The trio started the company as a solution for commuters who didn't want to rely on public transit but couldn't pay a premium for ride-share services. Their idea: buses and vans running along routes that users could book a ride on with an app.
seems reasonable (Score:2)
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Seems like exactly the same thing, but you just buy the ticket on the internet.
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Seems like exactly the same thing, but you just buy the ticket on the internet.
I haven't read up on what Swvl was going to do but I'm envisioning Uber Pool on steroids.
The opportunity is to make routes, schedules, and vehicle sizes much more dynamic and driven by demand. That's something traditional mass transit systems haven't done well. It's not that they couldn't, they just have not and as government agencies, I don't have high hopes they ever will.
The other thing ride share systems attempted to do was change the capital structure. Rather than owning the vehicles, drivers own them
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The general travel patterns are known and routes and frequencies are already planned to satisfy the needs. At least in places where public transport isn't considered a joke :)
I think what you mention with Uber Pool++ has been tried and mostly doesn't seem to work out that great. Basically you have to pool a lot of people to get it to make sense and then then your journey becomes a nightmare or you only get a few people and end up paying taxi-like money for more inconvenience.
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The general travel patterns are known and routes and frequencies are already planned to satisfy the needs. At least in places where public transport isn't considered a joke :)
How much is is the travel patterns are known or people adjust their travel patterns to match the bus schedule? That's the thing: people's desires adjust all the time. Mass transit systems tend to be much slower adjusting their schedules.
I think what you mention with Uber Pool++ has been tried and mostly doesn't seem to work out that great. Basically you have to pool a lot of people to get it to make sense and then then your journey becomes a nightmare or you only get a few people and end up paying taxi-like money for more inconvenience.
Yeah, that's a dance and maybe it'll never work. You're definitely trading off speed and convenience versus price. It's possible that tradeoff just doesn't exist. TBH, ride shares are way too expensive for me most of the time. I should look into something like Uber pool (exc
mega bus? (Score:2)
mega bus?
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Why are the busses empty? Do they connect areas that have no business with each other, are the tickets too expensive, do the busses run too rarely to be reliable, something else?
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Buses need to be passing by and available to pick you up very frequently, or they become too inconvenient. They need a good fixed schedule, so you can rely on them. So we make the busses run past every stop every 15 minutes AHA! Busses are now useful, reliable transportation! But now there's some routes with some times when almost no one happens to need that particular bus...they went on the one before or ride the one that comes 15 minutes later, and it just happens that not many people needed THAT particul
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bus rides here are free. I just don't think there are enough riders to really justify the routes so the busses are infrequent and can be complicated to use (They can switch routes mid journey) which makes it even less attractive to use them
I think the service might benefit if they cut the frequency further or maybe dropped a route, they could use that bus as a sort of "dynamic fill-in" just like an uber ride share except that the driver is getting paid !
it sounds like the kind of thing that could be simulat
San Francisco tried this (Score:2)
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The service died before the pandemic shut the city down, so it wasn't a victim of that bad timing, but there was a lot of consternation at that time about for-profit bus lines using Muni stops and the rise of the company commuter bus.
Yeah, it's almost as if you need to build a business with paying customers and demonstrate sustainable success before you proclaim yourself a unicorn. How quaint.
It was seen locally as yet another way tech was destroying the public good by consuming resources better left alone.
No doubt, that's a very San Francisco state of mind. We don't want competition to a public services, even if we don't especially like the public service and something better comes along, because Public Is Good, Private Is Bad.
I didn't follow that story. I remember the white commuter busses schlepping people between Santa Clara county and SF, oh abo
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Yeah, it's almost as if you need to build a business with paying customers and demonstrate sustainable success before you proclaim yourself a unicorn.
If you have to call yourself a __________ [unicorn/alpha male/expert/etc] , you're not.
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Valuations are ALWAYS mythical. Valuations mean nothing if there's nothing to back them. I could put 50 cents into a slot machine and claim that I have a $1 million valuation but some of the same logic these companies use. If you haven't sold the stocks yet then you have no actual value, and the point of issuing stocks is precisely to sell them and get actual cash that can be used.
Part of the reason for labeling companies as "unicorns" is for the hype. Get more gullible people interested so that you can
Re:San Francisco tried this (Score:4, Interesting)
The company commuter bus is a big things now. It's not a great idea, because it's a service only for that company's employees, so you have multiple private buses traveling the same route. In the past I have seen a public shuttle system that was heavily used be shut down because a few big name companies moved into an area and prived their own shuttles.
Right now this week, I see a Google bus that drives from a park-and-ride and exactly follows the mass transit light rail to its destination one block from a rail stop. Now maybe it starts further away (I haven't tracked it) but the fact that much of its route is identical to existing mass transit really feels like it verges on selfishness. I can understand the need to provide some service if there are vital workers who are not able to use mass transit, it can help with employee retention, but I feel like much of that expense on a private bus service is redundant.
But it's the same old story - only poor people use mass transit but we're rich therefore we have a parallel service that we use instead. We can't have good things if they have to be shared with undesirable people.
It's not "Uber for Buses" (Score:3)
SPACs (Score:2)
Uber for Busses? (Score:2)
Did nobody else on the way to this having a billion dollar valuation (at one point) notice that it was a really stupid idea?
Dubhai is world's laundromat. ... for money (Score:4, Interesting)
After the petro dollar boom, almost all the loosely governed South Asian countries use Dubai to wash their black money. Some of the black money is simple tax dodging, others are from bribed the politicians, and more from drug trade. The money launderers would take a loss in their trades, that the cost of money laundering. Their loss is profits for the traders in Dubai, using their government and sovereign funds to invest it in legitimate businesses around the world.
This is their business model. So no surprise they could run up a company valuation to a billion dollars, and cash out and leave the chumps holding garbage paper.
If you do business in Dubai, do it in gold, and nothing else.