The mobility-as-a-service startup has raised a total of £5m (€5.8m) to help staff at UK companies facing a lack of public transport infrastructure commute to work by accessing shared taxi and bus services.
Ride Tandem, a mobility-as-a-service startup launched in the UK in 2019, has raised £2.3m (€2.7m) to provide more sustainable shared commuter services for employers whose staff would otherwise struggle to go to work due to the cost, inconvenience, or complete absence of existing public transport options.
This latest funding round, which brings the total raised to date to £5m, was led by Blackfinch Ventures who were joined by First Monday VC, Rainmaking Impact, and backers through the Seedrs crowdfunding platform, with follow-on capital also provided by existing investors 1818 Venture Capital, Ascension, and the Low Carbon Innovation Fund.
Ride Tandem works staff of companies such as supermarket Lidl, clothing retailer Next and British postal service Royal Mail with transport partner companies, including taxis, minicabs, and coaches, through a driver and passenger app.
The apps work in a similar fashion to a ride hailing app but routes are created by businesses and are available only to their staff. Passengers book and pay for their tickets via the passenger app, receiving a QR code as a ticket. Drivers are then notified of how many people are waiting at each stop and scan passengers on using the QR code, allowing businesses to see who has booked onto, and boarded, each service through a reporting portal.
As well as allowing passengers to track the live location of the vehicles, the company said two important features of the service were giving passengers the option to make block bookings and access to payment software that offered flexibility in when payments were taken.
Speaking to Impact Investor, Alex Shapland-Howes, co-founder and CEO of Ride Tandem, explained the latter two features were missing from most ride-hailing and mobility apps but were critical to low-income workers, because passengers did not always have the money to pay for the bus before receiving their first paycheque.
“Flexible payments allow people to get the bus to work before they get paid and block bookings make it easier for people to book their week of tickets in one go. Given lower income workers are more likely to be on fixed shift patterns, this can make it easier for them,” he added.
Higher revenue, lower CO₂ emissions
Ride Tandem said its services had enabled passengers using its app to earn more than £40m in wages since the company’s launch “by unlocking otherwise inaccessible jobs”, and that the weighted average of £12.50 per week spent using the service – with 50% of passengers travelling completely for free and the other 50% paying in the region of £25 per week – generated a cost saving of £65 per week compared to using a private vehicle to make the same journey.
The company said it had also helped deliver higher and more consistent recurring revenue per rider for its transport partners than most ride-hailing apps, with the average passenger taking 20 or more rides per month, and reduced costs for employers such as parcel delivery service DPD, which has seen a 50% reduction in per-passenger transportation costs and a 38% reduction in the total cost of its employee transport provision.
Trips on Ride Tandem have also been reported to have saved more than 8,000 metric tonnes of CO₂ emissions to date thanks to the highly concentrated ride-sharing, with the average Ride Tandem vehicle carrying more than 20 passengers and operating at more than 70% capacity, compared to just 1.14 for the average commuter car.
Shapland-Howes added: “In addition to reducing carbon emissions by using a shared shuttle bus, we have partnered with climate action consultancy Climate Partner to allow our clients to purchase carbon offsets for their employees’ commutes.”
Tackling the cost-of living crisis
Ride Tandem said the UK’s cost-of-living crisis had compounded an already underfunded public transport infrastructure in the UK, with 20% of UK bus routes cut in the last 10 years.
The company, which operates outside cities and large towns where the problem of transport poverty has the strongest economic and social effects, also highlighted a recent survey which found that 68`% of low earners and 71% of people without a car, were concerned about the implications of bus service cuts on their ability to work, with the average cost of car ownership said to be above £3000 per year.
“Too many people are left with a stark choice, car ownership, which is itself increasingly prohibitively expensive, or simply not working. That’s not right, it’s not good for individuals and their families, and their social mobility and mental health, or for communities more broadly, and it’s not good for the economy,” said Shapland-Howes.