ZOOMCAR CASE STUDY
I remember back in my MBA Days, when a newly opened Startup “Zoomcar” was the talk of the town for providing Free First Rides up to 50km.
Obviously me and my college friends did take full advantage of it ;p
But why were they giving it for FREE?
This Blog is all about Zoomcar Business Model.
How Zoomcar the Bengaluru-based car rental platform created a chain of nearly 6500 + cars spread over 26 cities and raised over $45 million in funding.
Today, Who allows 3000+ rides on a daily basis!!
I have shared most detailed case study on ZoomCar with the ZoomCar business model.
WHAT’S IN IT FOR YOU ?
STARTING OF ZOOM CAR – INITIAL DAYS
Lets start with the idea of ZOOM CAR developed in the minds of the founders.
The Story of zoom car starts with the founder.
ZOOMCAR was founded and lead by an American Duo – David Back & Greg Moran.
Greg had an idea about India as where he started his career in a bank had a branch in India as well.
He felt that India was a largely unexplored market and it must explored soon.
So Greg decided to visit India explore it more than just on papers.
At first, he had an Idea of starting a company for the renewable energy space but
soon after his arrival he realised that there was a strong business potential for the car rentals in India.
At the time, no player in India was offering a similar service of self driven car renting.
ZoomCar would automatically receive the edge and because of the uniqueness in its fundamentals.
Greg believed his idea had the potential to click in India!
Once the idea and the business model was finalised, next major challenge was to register this type of business in India.
They needed at least 50 cars in their name, registered, owned, and insured and also they needed to have five offices across the state in which they are getting license.
To overcome this challenge, they jumped to the conclusion that they would tied-up with local operating owners who already had license and ended up subleasing cars from them.
This is how ZoomCar was initially launched in 2013.
They used their license for almost ten to twelve months, after that, using the money they earned in past ten months, they procured 50 cars of their own and also got the license.
Since then, there was no looking back.
They faced one problem after the another but the company always managed to survive the process, and has managed to grow on to become largest self-drive rental company in India, with a market share of 60%.
ZOOM CAR BUSINESS MODEL
ZOOM CAR is India’s first online self drive car rental company. The business model that it follows is of peer-to- peer car renting business.
The company allows an individuals to hire cars on rent.
Yes!! You can hire a car for few hours to days to even months.
ZoomCar follows a model wherein the company owns almost 75% of the cars through loans from the banks.
While the remaining cars are on lease from large companies like Avis Budget Group.
Other than that, recently the brand have also started a new initiative called ZAP (ZoomCar Associate Program).
Here, individuals can invest in either a Maruti Ritz LDI or a Maruti Swift LDI (for now) and get into a 30-month Lease Agreement with ZoomCar to lease the car to them.
In against for the business and for all the operational support cost that ZoomCar will provide, they take a 30% commision of the revenue earned from the car, and they also provide a monthly minimum guarantee payment of 3% of the vehicle ex-showroom price to ensure a baseline level of repayment, as well. At the end of the lease tenor, ZoomCar will return the car to you.
Little confused ?
Let me explain you in some very simple steps –
#1 Select a Car
#2 Apply for an offer
#3 Pay specific amount and book
#4 Delivery of the car
#5 List your Car and Share when not in use
Still confused ?
Go through the ZoomCar Official webpage dedicated for ZAP programme.
HOW TO BOOK A ZOOM CAR
You can book a zoom car by following 5 simple steps –
Step 1 – is to search for a car you want to book and then click on book car on their website or on their mobile app.
Step 2 – Now, you need to upload your driving license through the website or the app and you need to pay a small security deposit.
Step 3 – Your request will be processed and 20 min before the pickup time you will receive the car details via SMS.
Step 4 – Then, at last you need to fill the start checklist on the Zoom Car app. Then just grab the keys from the glove-box and drive.
Step 5 – You need to return the car to the same location from where you picked and fill the end checklist to finish your trip.
MANAGEMENT AND THE CORE TEAM
He is the Co-Founder and CEO(Chief Executive Officer) at ZOOMCAR.
Prior to Co-founding Zoomcar, Greg studied at USC’s Marshall School of Business.
He was the Founder and President of the USC Energy Club, Southern California’s largest club.
Greg is also a graduate of the University of Pennsylvania, where he holds a degree in International Relations.
Apart from the professional life, he is personally interested in playing piano and hitting the golf links.
He is the Chief Technology Officer. He is responsible for the technology at ZOOMCAR.
He has a rich experience of working at early stage with hyper-growth companies such as Speedera and Inmobi.
Vinayak is also a well known speaker at various national and international technology conferences.
He is also the co-founder of Headstart Network which is a decade old not for profit network that mentors various early stage start-ups.
Apart from the professional life, he is personally interested in photography, travelling and reading books.
He is the Chief Operating Officer at ZOOMCAR.
Before joining ZOOMCAR, he worked with P&G for more than 8 years. He also has 3 years of experience with DRDO in project management.
Apart from the professional life, he is personally interested in playing golf.
He is the General Counsel & VP Corporate Affairs at ZOOMCAR.
Before joining ZOOMCAR, Manish has worked for some of the biggest organisations in India such as Snapdeal.com, ZTE Telecom, DLF Limited, Delhi Stock Exchange Association Limited and Yadu Corporation.
He is the Chief Marketing Officer at ZOOMCAR.
Varun is responsible for the marketing and demand side of the business at Zoomcar.
He is having more than 12 years of experience in the field of marketing and growth strategies. His expertise lies in growth marketing and scaling up internet businesses.
loves to read during his travel and leisure time also he likes to go on unplanned road trips.
He has travelled to 12 different countries so far.
He is the Senior Vice President & Commercial Head at ZOOMCAR.
Prior to ZoomCar, Hemanth was previously working in the Principal Investment Area (PIA) of Goldman Sachs in New York. He worked on equity, loan investments and mezzanine in companies across multiple industries.
Apart from professional life, Hemanth personally loves to travel and pursue various outdoor activities including scuba diving, cycling, skiing, and hiking.
FACTS AND FIGURES
Automotive, E-Commerce, Rental, Reservations, Transportation
Venture – Series Unknown
Number of Employees
Legal Name is Zoomcar India Private Ltd.
Zoom Car has raised a total of $115.2M in funding over 11 rounds.
The company raised its seed funding in October 2013 for a total amount of 1.6 million dollars from Barbara Judge, Nurzhas Makishev, Basset Investment Group, Empire Angels, FundersClub, Lloyd Thomas, Microsoft Accelerator.
Latest funding which ZoomCar raised was from Trifecta Capital for an amount $11,350,000 on 10th July, 2019.
ZoomCar partnerships have been a great strategy for them.
ZoomCar has created several partnerships improve their services and to grow gradually.
Few of such partnership includes automobile manufacturers such as Ford & Mahindra.
Their partnership with Mahindra and ford have allowed them to become the first car rental company in India to offer an electric vehicle i.e. the Mahindra REVA E2O and the Ford EcoSport.
They have also tied up with Tata Motors to add 50 brand new Tata Nanos to their fleet of cars.
Other than that, ZoomCar has also penned down several other partnerships with locally established real estate developers, universities, hotels, and corporate IT parks to secure parking for its vehicles and offer pick-up points to its members, as well.
In November 2013, ZoomCar also initiated for a noble cause partnering with Uber and the Ashoka Foundation.
Together they launched a campaign in Bangalore and named it RideSmartBLR to discourage drink and drive for its economical, health and environmental benefits, and encourage car-rental.
- The company has the first mover advantage.
- The company remains very well updated with the latest market trends and cosumers changing behaviour.
- Customer satisfaction – At this initial stage, ZoomCar is failing to provide full satisfaction to its customers.
- Scalability – There is a vast opportunity for Zoom Car to scale its business across all the state in India as well outside the country.
- Competition – The greatest threat for the company is the competition which it has to face in form of new emerging car rental start-ups.
- Governmental regulations ( leasing and age cars)
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