Together with on-demand market experts and real-life entrepreneur, we've had the chance to dive into some fascinating conversations about launching a Super App project. In this article, we'll break down the highlights and expert takeaways from a recent podcast that focused on a critical decision many entrepreneurs face: Should you launch food delivery or ride-hailing first in your Super App package?
Below is a summary of the key takeaways from our podcast speakers, each a seasoned expert in their field, who shared real-life lessons, challenges and valuable insights into launching these two challenging verticals.
4:52 What should an entrepreneur do to launch a food delivery business?
Vera Kozlova, Key Partners Manager at Playfood, highlighted two essential steps for launching a food delivery service:
Identify Unique Value Proposition (UVP): Understand the market, competitors, customer pain points, and existing gaps.
Create a Business Model: Draft a high-level plan for income sources, expenses, and pricing strategy. Research is key to positioning the business competitively.
Additionally, operational logistics such as contracting with vendors, recruiting couriers, and setting up a Call Center are crucial. Start small to test the operations and scale as needed.
12:03 What should an entrepreneur do to launch a ride-hailing business?
Elizaveta Pischala, Account Manager at Onde, emphasizes that starting a ride-hailing business requires market research and operational decisions:
Choose the right technology: Entrepreneurs can use a platform like Onde to save time and money, or develop their own custom solution.
Attracting drivers and passengers: Building a base of drivers and attracting users through marketing is critical. Drivers are the backbone of the service and passengers need to know that the service exists, which ties back to marketing investment.
Analytics is important for constant monitoring, especially in terms of cancellation rates or popularity of service types.
19:02 Challenges in launching each vertical (Real-life experience from Super App businessman)
Gedion, co-founder and COO of the RIDE Super App project, shared the complexities of scaling both verticals in new markets:
Market differences: Every market is unique. While ride-hailing might work in one country, food delivery might face challenges due to lack of digital infrastructure such as payment gateways.
Choose the right workflow: Entrepreneurs should understand that choosing a system like Playfood or Onde means committing to a specific workflow and operational process.
He highlighted that while ride-hailing may be easier to scale, food delivery can be tricky, especially in markets where logistics like payment methods aren't fully developed.
25:10 Challenges and opportunities in launching food delivery services
Vera highlighted several universal challenges for food delivery:
Regulatory: Complex in some markets, with varying restrictions on couriers and licensing.
Payment systems: Particularly difficult in regions without centralised digital payment systems.
Cultural factors: In some countries, communal eating habits may limit the demand for food delivery.
However, she also highlighted that food delivery is becoming a habit, especially among millennials and Gen Z, which presents great opportunities.
36:55 Critical factors for success in ride-hailing services
Elizaveta stresses that operational excellence and marketing are key:
Driver support: Ensuring drivers are well trained and feel supported helps with retention.
Passenger experience: Quality of service, including pricing and safety, plays a critical role in user satisfaction and market traction.
Personalised approach: A customer-centric focus builds long-term loyalty, whether through driver support or passenger care.
47:05 Top 3 operational mistakes
Gedion outlines three key mistakes:
Underestimating people management: Attracting the right talent to manage operations is critical.
Neglecting the customer side: The business depends on both customers and drivers, but customer acquisition and satisfaction are paramount.
Blocking innovation: Entrepreneurs must remain flexible and open to product development, particularly in areas such as payment systems and fleet management.
53:52 Unit economics comparison: Food delivery vs. Ride-hailing
Vera explains that the economics of food delivery are more complex because there are multiple stakeholders - suppliers, customers and couriers. While ride-hailing only deals with drivers and customers, food delivery requires more careful planning to balance costs and revenues across all three.
Launching ride-hailing may seem safer from an economic perspective because the model is simpler, but food delivery can offer higher revenue per transaction once properly scaled.
01:04:05 Financial considerations in deciding which service to launch first
Elizaveta highlighted important financial considerations:
Marketing budget: This is key for both industries, but ride-hailing may require more upfront investment to attract and retain drivers.
Driver costs and salaries: The structure of driver payments (percentage, fixed salary, etc.) is critical to ensure sustainability.
Unexpected costs: From taxes to transaction fees, these hidden costs need to be factored into initial financial projections.
01:14:35 Super App representative's experience and advice
Gedion emphasized the importance of scaling sustainably and diversifying revenue streams. A Super App should not focus on just one service, but must constantly innovate and grow other verticals to prevent competitors from entering the market and eating into profits.
The decision of whether to launch food delivery or ride-hailing first in a Super App depends heavily on market conditions, financial resources, and business capabilities. Both verticals have their own challenges and opportunities, but with the right planning, investment, and focus on customer experience, success is achievable.
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