Bolt – a ride-hailing startup is now valued at $8.4 billion as it has raised the sum of $709 million in funding.
The ride-hailing startup had experienced growth in Nigeria, following the COVID-19 pandemic and the significant “chilling” effect it had on people, with their willingness to travel in enclosed spaces with other persons.
This is part of the challenges experienced by its competitors which Bolt had an edge over them. Based on the funds raised, Bolt intends to use it to expand to new geographies and also, bring more consumers and partners to its “super app,” while newer business lines, such as its 15-minute grocery delivery service.
Also, with the Bolt Market, it will be building out “dark stores” in more cities to expand the service beyond the ten where it is currently active.
Bolt (formerly known as Taxify) was founded eight years ago in Tallinn, Estonia with a mission to bring ride-hailing to emerging markets and countries where others like Uber had yet to establish a strong foothold, a strategy that it used to modestly expand across regions like Central and Eastern Europe and Africa, attracting investors like China’s Didi, which had built a massive business in its own emerging market.
The focus of Uber’s marketing had stayed on Europe and Africa over time, but Bolt discovered that many of the lessons learned from those early launches could be applied just as successfully in more industrialized countries, with more profitable payoffs.
Meanwhile, Bolt’s diversification strategy includes scooters, couriers, and now food delivery services in addition to automobiles, is part of its up-scaling strategy.
Putting all of the alternatives and cross-promotions under a single app not only helps Bolt draw in new consumers and cross-sell to them, but it also does so with basically zero marketing costs, according to Villig.
Speaking on the funding, founder and CEO, Markus Villig said that all business units are growing and is experiencing double-digit growth. He also added that the newer businesses though smaller, are also on a fast speed expansion.
“The new trend of last year is that private cars are a bad thing and increasingly people want to use other forms of mobility”, Villig said.
Villig added that Bolt is working on partnering with more city governments to build out its services as part of their updated transportation strategies.
He admitted that Bolt had in times, faced some “short-term fluctuations” in demand when the lockdowns had earlier started.
He also added that Bolt has made attraction and has been keeping drivers by paying out better commissions to its driver than its rivals.
“There is a massive lack of supply on these platforms, so we have focused on taking the most partner-friendly lowest commission,” he said.
That has paid off well for Bolt, which has now seen monthly revenues more than double compared to sales pre-Covid, Villig said.
He added, “We started off in Eastern Europe and Africa because those markets had a bigger need. They had lower car ownership, higher unemployment [making for a market with many freelance drivers], it made sense”.