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OnRamp Business: How BidRide is Changing Transportation

Innovating the Giants: How BidRide is Changing Transportation

Written By: Dan Steininger, President and Co-Founder of BizStarts
As seen on the February 25, 2016 post in Milwaukee Business Journal OnRamp Blog.

 

When Uber burst out into the scene in 2011, taxi cab drivers and taxi companies fought furiously to stop this new transportation service giant from expanding and cutting into their business. It was ruining the taxi industry.

Well, not all taxi companies viewed it this way. Enter Joe Sanfelippo and his daughter Andrea Davis, co-founders of BidRide, a new app-based transportation service that allows drivers and riders to negotiate the price of the ride. Realizing that the taxi industry hasn’t changed in 100 years, they knew it was time to innovate.

Any disruptive technology or service transforms an industry but also opens new niches and opportunities where none existed before. Joe Safeilippo was just the right person to find that new opportunity created by the success of Uber.

The taxi industry runs in Joe Sanfelippo’s blood. His father began driving a taxi in the 1960s and his brother Mike began family run American United Transportation in 1997. So one would think Joe would join the fight to stop Uber and Lyft’s crusade on taxi companies.

Not Joe. He and his daughter looked at Uber and Lyft and took the perspective that these new companies are helping the taxi industry. How so?

Well, first of all, Uber proved there is still an appetite and market for taxi services. It also showed the industry that customers want a higher level of service.

For Joe, this was a wake-up call. Competition is good – it gets you to think outside of the box and think of new ways to do business. It was time to take advantage of technology and find a better way to operate.

Pouring over articles from all over the country and world, Joe found out what people in every city were saying about Uber. He was able to pick out all the good things Uber brings to the table. More importantly, he found ways to improve on its weaknesses.

The biggest weakness? Drivers are earning less. Uber makes claims that driver will make $100,000 a year, and then raises the fees they charge drivers. The fees began at 10% of the ride fare; now they’ve reached 30% in some U.S. cities. Uber keeps lowering rates for riders to swallow the market, leaving drivers powerless and receiving less money per ride.

Similarly, in the heavily regulated taxi industry, taxi cab drivers are stuck using the rates the local governments decide for them. In both systems, drivers have no control over what they charge for a ride.

And there it was, a solution: let the driver and rider decide on a price. The rider makes a bid and the driver counter-offers until they agree. BidRide was born.

No more getting stuck with surcharges from Uber as a rider; no more rates set in stone by Uber or the government for drivers. With an app allowing a rider to summon a driver and then barter on a price that suits both parties, BidRide is creating the first true free market transportation service in the world.

Now, a driver will never work for less than they want, and a rider will never pay more than what they think is right. Everyone benefits, and thus emerges the beauty of free market economics.

Plus, all the drivers will carry proper commercial auto insurance policies and will be properly licensed, eliminating the safety and trust concerns caused by unlicensed and unregulated Uber drivers.

Joe and Andrea are having a “soft” trial launch later this month, hoping to get user feedback so they can improve their service and get more taxi drivers to get on board with BidRide. A full public launch in Milwaukee is planned for late March.

This approach, facing adversity with true innovation, may result in BidRide seriously challenging one of the fastest growing tech giants in the world. As Joe puts it, “If you can’t beat them, join them… and do it better.”

View Dan’s blog post on OnRamp >>

About the Author
Dan Steininger is the president and co-founder of BizStarts. BizStarts facilitates the creation of new companies in southeast Wisconsin. He currently teaches courses on innovation for the UW-Milwaukee School of Continuing Education for business leaders. Contact BizStarts >>

About OnRamp
OnRamp offers conversation and connections among the entrepreneurs who are shaping Wisconsin’s economy, and brings corporations and start-ups together at statewide events. View other OnRamp blog posts >>

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