David Litwak:
Hello and welcome to how I got here mozia and focus wires, a weekly podcast about innovators in travel and transportation. Today we have Nicolas Bruce song of blahblah car blahblah car gained popularity as a platform for long distance carpooling. But it’s fast becoming the go to platform for shared road travel. They’ve got a lot of diverse initiatives and investments including an intermodal transport platform with SNCF, blah blah bus which originated from an acquisition of we bus that operates in 400 cities in Europe and blah blah ride a partnership with vuoi the European scooter startup oh and blah blah line, a commuting a commuter carpooling service as well. So thank you very, very much for joining us, Nicholas.
Nicolas Brusson:
Yeah, thanks for having me.
David Litwak:
So we like to start every one of these interviews off the same way, which is for us to ask you how you got here.
Nicolas Brusson:
Yeah, no, thanks. So you I’ll try not to tell you all about my life and and how I get there. But essentially, I was probably not meant to do entrepreneurship. Yeah. I studied Physics back in the late 90s, in, in France. And I moved to the US in 1990, actually to complete my master’s degree and to do a PhD. And for those who weren’t back then study back then it was during the.com and telecom boom, essentially, of the late the late 90s. So I ended up in Berkeley, with most people actually not doing the PhD not finishing their master degree and doing into startups. And back then, literally, I did not know about startups and venture capital, Silicon Valley’s stock option, or all that all those buzzwords of you this ecosystem that we know well today, and especially It was very much foreign to Europeans or French people back in the late 90s. up with very few startups, very few VCs in Europe. So I ended up joining pretty early stage startup in optical telecommunication. I had my background in optics and physics. We ended up raising from Kleiner Perkins and beat VCs. And we had a pretty phenomenal ride from raising tons of money be raised $85 million. We grew very fast, then cane 911 recession in 2002. And the whole thing got wiped out. And we had like a series of layoff. And company one promises essentially 30 people to 150 to 10 within two years, but that’s how I get into into startups and entrepreneurship. So I spent seven years in the valley. And then I wanted to go back to Europe. So it was around 2006 2007. do two things a to do more of that in Europe, because it was still pretty slow. And also to get eventually have to spend some time in venture capital. So that’s what I’ve done. And that’s where I met Fred actually my co founder and one of the the three co founder of blablacar actually doing an MBA at INSEAD. And yet started this, this website called good virtualized that fr which means carpooling.com essentially. And against a we I fell in love with the guy and his passion and he was doing this thing as a side project back then. And it felt like you eBay of services and again, it was pre remember 2006 pre iPhone. Facebook was still a private network, just taking off. And we started to work on that which you ended up being blablacar and Nunez, the sharing economy and all that stuff. But we’re pretty early, like 2006 2007 was almost like two, three years too early for this type of companies. So so the start of blablacar and I’m sure we will expand on that was not a fast journey. It was like a long, painful ride initially from 2006 to the first funding in 2009 and during the recession. You’re leading to the more known stories of 2012 and build. So you get into startups like almost 20 years ago. Love it. And buy the car has been the opposite of how you create a startup today, it was sort of slow and painful and very hard to raise money initially. Which doesn’t feel like that these days were a lot less.
Kevin May:
Hi, Nicholas. It’s Kevin here. Thanks so much for joining us on how I got here. And lots to pick apart there, I suppose. But I think the one question I have to kick us off really is where did the idea of car pooling and kind of automating that and almost digitizing that process come from that? I guess that’s the second part of a two part question. The first part is how did because it’s kind of hitching in a way it’s old school hitchhiking. So talk us through that process. from taking the hitching concept into carpooling and then deciding, this is what we need to do, because I think it’s just a fascinating way to, to start a business and the concept.
Nicolas Brusson:
Yes, it started in, in many ways, but I would say it started as a concept in Fred’s brain. My co founder, actually was looking for a train for Christmas, actually, to go back to his family, from Paris to volunteers. It’s on the west coast of France. And all the trains were booked and he was like, okay, there must be a classified where you can find some, some guy actually driving there and they can contact that person and just because he can discard, and there was, you know, we had like a website called longquan, which is like the Craigslist of friends if you like, and there was very few of that actually, a few people were sort of hitchhiking but it was seen as risky and reliable. Yo, it was something from the 70s or the 60s but not something people Do actually in in 2005 2006 2007. So you started to develop a very simple website. And that’s, that’s when we met. And you’re right at the beginning people saw that as hitchhiking. And it’s been one of the big issue. Actually, we had we’ve, we’ve blablacar. In the early days, people saw that as hitchhiking. And they felt like, hey, people don’t do the checking anymore. So you guys are doing your checking online, which is absurd, because you do trying to put something online that people don’t even do offline anymore. And the big Theseus back then was offline to online. Again, like right now we do a lot of cool stuff. It was e commerce, it was all that stuff. And essentially, what we described was, it’s not hitchhiking, essentially, through mobile and social network, we believed you still, we can create trust within a community and make that essentially like a much larger transport network that does that’s not about hitchhiking. It’s just about like, you have to travel Reliable means of transport, optimizing empty seats in cars. So if you see this way, you have a complete different picture because you realize that all over Europe, all over the world 80% have even known distance travel is done by car. So if you look at France, ubica, Germany, UK, the UK, that’s how people move around on distances between 50 and 500 miles. So if you look at the empty seats in cars, that’s actually the biggest city inventory on Earth. It’s bigger than in the second century in planes and buses and trains. And it’s very poorly optimized. Because the car is private, it’s not shared. The data is not shared, people can trust each other and so on. So we thought that’s what we need to solve to create the transport network that people so that does Hey, you guys, checking online, makes no sense. And that’s also why I was I was mentioning how tricky it was to to fundraise in the early days. And remember, like Fred and I actually, pitching it was the first time issue we had like a business person. Additional pitch if you’d like. So we pitch the business to a group of business Angel. At INSEAD, we’re doing your MBA. And the feedback was, you’re very negative back then you people told us like a if you get 100 hundred thousand people to use your service in false, you guys get lucky and you get essentially all the bugs to sign up on your website. And by the way, there is no business model. So you don’t really close to 100 million people adding signed up globally in 22 countries, right? So we’ve gone a long way from the if you get to 100 K, you’re lucky we get to 100 million and we still almost steal that. And we go beyond that.
And the reason it took time is a few ingredients that make actually the sharing economy and the sort of trusted network element actually possible. We’re not there yet. What is it? We’re not that visible? It was a mix of like mobile phones. So we were pitching that pre iPhone. Before the iPhone came out, sure that smartphone but it was more like blackberry type smartphone and not like iPhone type smartphone. Facebook was still pretty small. It was Facebook until 2006, if I’m not mistaken was a private network for, like new people from university and it just opened up around that date. I mean, give a date. And essentially, that’s what we, I guess we saw is that social network plus smartphone would actually help create this distrust between people. And everything became what was very funny, hate works. He started to have a word ready in 2010. And it was the sharing economy. And Airbnb raised money from South Korea, and it became a thing and suddenly, like the perception of investors change radically overnight. Whereas for us, it’s in terms of usage of the platform and the growth story. It was like a continuous to just send it to him when he became available. But before it was like, yeah, you guys are doing it, shaking it. It’s a weird thing to do. To wow that’s sharing economy for cars. That’s huge. And and so it became but but it’s there was a bit of a disconnect between the we said the user reality and the investor world which overnight may not have an eye but we’ve you know, your change from Haiti shaking. That’s weird we are to while chilling you couldn’t be at school. And that helped us I guess.
David Litwak:
Yeah. So Nicholas, first of all Go Bears I went to Berkeley as well. And after Berkeley actually spent seven years in the valley and like every good Berkeley or Stanford Graduate at some point applied to Y Combinator. And I remember hearing the statistic that the single most submitted idea of all time at that time, which was seven or eight years ago, was a carpooling network to Y Combinator. And this was around 2010 when I graduated, so right around the time that you’re talking about, and so there you know, and I was told this in kind of like a you know, cautionary tale that there are a lot of dead bodies in carpooling. And you see this, you know, quite a bit, you know, zimride, which is now lift right, you know, was like a flailed around in America trying to do something similar and just didn’t succeed. So, you know, it’s kind of a two part question here. What was it about France or Europe in particular and or your approach that really broke through when you know, when it was so many other failed?
Nicolas Brusson:
Yeah, it’s interesting. It’s almost the question is almost the opposite is what turned out to the opposite. What is it about the US that made carpooling so hard to crack in the US to some extent, because today, carpooling works in France and Spain, in you in Germany, so all over Europe, but it also works in Russia and Ukraine, in Brazil, in Mexico, we do many, many different places. So we’ve been, it doesn’t work so well. In the UK, by the way, interestingly, we can get to that as well. I mean, we’ve in Europe, basically, UK works a lot less than other countries outside. It’s I think one of the reason Not working in the us is that the US doesn’t have the first mile and last mile, drug and transporters, and she can get people to a car. So the way carpooling works, if you think of it, a driver is going to say, Hey, I’m going to leave from that part of town. And I’ll drop you off to San Francisco, and I’ll drop you off somewhere in Los Angeles. But we always assumed, or PC security tends to assume that the passengers, the 234, guys actually sitting in the car come from different location, and the driver is not going to taxi around areas of Los Angeles to pick them up. It’s a nightmare to do that. So they need to find a way to do the first like 2345 miles to get to the car, just like they would get to a train station or bus station, and then drive together and then be dropped off. And it turns out that Europe is great for that because historically we have trains and we have very good public transport, very affordable public transport and very sort of compact cities. Now if you take my example of Los Angeles Less if I tell you and drop you off somewhere in Los Angeles, or even in the Bay Area, what good like you if you want me to send you another drop you off in Mountain View, how do you get between the two? Right needs to be tricky, too. And, and that was the single biggest problem zimride, which ended up being leased with john and Logan faced actually back then, they had a few trips going from the area to tow but the issue is again, like no public transport in on either end of that connection. And it fell to it. That was the main, I think the main reason, the other one was your petrol prices are pretty cheap in the US and the cost of driving is a lot cheaper. So the incentive, the financial incentive to share is not as strong. But again, I think the first one is the most fundamental and interesting, it was one of the struggle for us to fundraise, by the way because people especially back then were looking at European startups, as doing something that was done in the US. A couple of years later and trying to run faster than the US company would expand into Europe, essentially. And people always look to the US, you’re saying that well, no one is doing carpeting in the US. So invalidates the fact that he shaking is weird. That that the company is never going to work, because you’re usually things that work in Europe tend to add worked before. In the US, I think it’s a bit less true today. But back then that was really the, the sort of the rationale of, of many investors. So and today, actually, there are not many players doing carpooling at any scale in the US. Interestingly, sea does not read taken off as a thing in the US.
Kevin May:
How did you in that early phase, almost kind of educate the market, whether that’s consumers or the investors that this was something that was both more efficient and safer than hitching. So this was actually a proper carpooling service and get over those preconceptions that people have.
Nicolas Brusson:
Yeah, there are a few things they should we’ve done pretty early on to really differentiate carpooling from hitchhiking. So if you can get the shaking, it tends to be unscheduled. So it’s just like historically, it’s just a guy on the side of the road. Exactly. You put your thumbs up or you have like a cardboard saying, whatever, like you, Paris or London or whatever. Yeah. Here it was different because really, you’re replicating the same behavior. You do when you book a train a plane or anything. So you book a seat in advance, and there is a price so there is like an agreed price or an agreed value for that seat that the driver is going to decide on. And then we let essentially a community vetting taking place. So essentially, as a passenger, you send a request to a driver and the driver can accept or refuse you in the car. But the main difference is with hitchhiking where But three things a, there is always a price. So where’s each shaking? assumption of it’s free or it’s always awkward essentially, like, it’s an awkward discussion when you do hitchhiking they should, like they not they may expect you to pay. It’s unscheduled. And the trust layer is non existent, because you’ve just picked up someone from the side of the street. So essentially resolved for the prices transparent, very clear venue for events that you scheduled. You do that in advance, it can be very last minute, but you do that in advance very much in the way. So it’s the same behavior you pay online, on a website or an app. And we’ve built on this The main thing with built the trust layer, and I often describe it this way the instill today actually, the thing we work on the most is actually building trust and helping people match with each other. We don’t manage a transport network. So if we take the example of the coffee crisis, carpooling just turned itself off like we did not choose To stop the network, people stop carpooling because you, everything was shut down. And you just restarted buscombe because people restarted carpooling. But we don’t design the transport network, we don’t decide where people go and when they go. So essentially, our job is not to manage a transport network in a traditional sense, we don’t deploy capacity. Our job is to manage, essentially the best match. And the best match is a function of time, money, and trust. So essentially, like we realized that as we gather more information on drivers and passengers, and we start adding, like new hundreds of ratings, and they verified, we have the driving licence of the driver, we have the license plate of the car and again, like tons and tons of ratings on the driver and passenger, the match rate will do the ability to get accepted as a passenger in a car goes up and up and up. And you create that trusted network, which is quite unique. So So we actually solve for trust and matching. Not so much for What traditional transport company worried about?
David Litwak:
So I wanted to segue a little bit into kind of what some of your new initiatives are here, because and I’m curious what your Northstar is with all these initiatives, you could say it’s the spare seats, but you also now have buses. And you could say it’s shared transportation, but you also now have scooters. Right? And so what is the what is the overarching mission and how’s it evolved from day one to where you are now for your company?
Nicolas Brusson:
Yeah, I would say the north star has been the same for many years, we sort of sometimes change the weather the way we describe it, but essentially we call that zero empty seats. So essentially, you we try to optimize inventory of car seats, but also now bus and potentially we could do that on train seats. So that essentially you maximize this inventory so that vehicles and being as full as possible, which makes sense from a environmental point of view, Because obviously you consume a lot less energy with a full car and you do have an empty car. And economically, so that’s how you can actually democratize transport even more. So and then over time, we evolved from just doing carpooling and being known for, you know, essentially black car and carpooling to realizing that actually, we have this massive audience of passengers looking for rides from city a to city B. And at the end of the day we’re going for is a solution from city a to city B or for Point A to Point B might be a car, it might be a bus, it might be a train, and then a black car, it might be your combo of all of that. And because we you know where we have, you will be lucky to have a massive audience in Super qualified, trusted audience. And it was pretty easy for us to start adding more supply at buses and eventually we began trains and start to connect his border network and offer actually more to our passengers. So that’s what we’re doing blah blah right, which is more of an experiment like Institute experiment today to be on the side of and broader mission. The main point here is to connect our world which is more like an intercity world with the NCD world, right? So today we’d say we stop existing when people do you have a zero to five Myers like they would typically resist when people go 20 miles 2000 miles. So we wanted to especially in Fall stick now we’re doing this, this test to avoid on the on the ride, eventually, maybe doing bikes, but we want to connect people to the first and last mile in the city is
David Litwak:
very interesting. So you know, I think you if I’m not mistaken, you guys have kept all your apps separate. And so I kind of wanted to actually touch on that as a general business strategy because I feel like super app is the, the, the you know, the fashionable thing these days for people to be thinking about and you’ve actually kind of somewhat issued that. Yes, I’m curious. Maybe give me some details for like how you are thinking about about that from a business perspective?
Nicolas Brusson:
Yes. So it’s it’s more of a way we get there that an ambition, right, so. So blablacar obviously was one app, single app. We don’t have like different app for drivers, passengers and use cases. We went into buses by m&a. So so we ended up essentially getting like a new app, which was we been rebranded blunderbuss. We get a new app called bus four in Russia and Ukraine that does buses. The goal is to bring all of that onto Blackboard. So essentially, anything that’s made long distance, that’s kind of my obsession right now as to be reintegrated into a single app. So we have some one app obsession right now in the company. And within a year, it’s all going to be integrated into into one app. So that’s for all the the buzz business. It scattered today. I would say not by accident, but by construction of an m&a process we get to get there. When it comes to what we’ve done, we’ve yoruban, carpooling, blah, blah, lines, it was different. It was indeed a choice. Because we realized that the way you correct commuting, so maybe I should step back with business you’re incorporating we have two slightly different product, one for medium distance, which tends to solve like people going on weekends, holiday short breaks. So typically, you’re driving 100 to 500 miles. So we’d say you’re going from Paris to the Alps, or, or whatnot. And we also have like a new app that we launched roughly a year ago. that’s meant to solve your daily commute. So going from home to work driving, which is what you 80% of people do, actually. So we tend to think when we live in cities like San Francisco or Paris or London, that people take the the tube of the metro do good work. At the nation scale. It’s not true. It’s actually three quarter of the population, use a call It’s close to 80% actually use it a car, do good work. And it’s highly inefficient because the car is for the most part empty. So in that case, we decided to develop a separate app. So that we could we could play freely on the product paradigm, because we realized that the schedule model, and the way you look, a long distance journey to go to weekend is fundamentally different from the way you think of your daily commute that you’re going to repeat every day. So we don’t want to be stuck with the the booking platform and the product paradigm of black car. And we want to think freely within another app. It might converge long term, but essentially you need to realize if you if you launch a side product, on your existing product, you very often going to be stuck with some product paradigm we defined on the initial product. So again, like you if you want to do like a citymapper on train line, it may be tricky, actually. Those are different use cases and you realize that actually the product look varied. So today, bloodlines loops look very different from from rubber car, long term, all the supply. So essentially all the trips and we build API between the apps and read record is meant to be that sort of like, go to app for all the trips. Yes.
David Litwak:
So one more for me until I hand it back over to Kevin. You know, there’s been a lot of interesting stuff happening last five to 10 years in long distance transportation in Europe. I think, you know, I think you’re probably, you know, potential arch nemesis here is flex plus. And, you know, that was prompted by the liberalization of the German bus market, and they went and, you know, snatched up a lot of European bus competitors. And, you know, come into here in New York, for example. I’m curious that you mentioned a couple acquisitions are in Ukraine and Russia. How have you thought about expansion? Clearly, you bought the bus off of SNCF. And, you know, I know you guys are in for and set 400 cities around Europe. Like Have you thought about the network effects of expansion and your m&a process for kind of solidifying kind of like a use case that can compete nationally or internationally with a flicks bus?
Nicolas Brusson:
Yeah. So, so maybe couple of questions within. Within that, I mean, the interim of expansion and m&a strategy, we had two very distinct phases. Essentially, we had, we had one from 2012 to probably 2016, or 17. And it was all about global expansion. So essentially, we add a great product carpooling. So blablacar. working well, in France, it’s starting to work well in Spain. And we realized that again, no one’s doing that pretty much anywhere in the world, in Europe and outside of Europe. And we get to try as many markets as we can. So essentially, we had this first phase of feminine because all the m&a we’ve done from 12 to 16. It was essentially like pick, we’re hiring teams locally. You’re in different markets, we’ve done that in Russia, we’ve done that in Poland, Italy, we’ve done that in Mexico, it was just about speed. So So vo MLS, the MLS strategy was, was essentially like, if we, if it goes faster to buy, then built, we’re going to buy fix a great change. But we want it to be first in all these markets because if you look at the black car model, it actually be like a classified bit like interminable CGC marketplace where very quickly you have millions of drivers sharing with billions of passengers. And it’s truly we often abused this, this concept, but it’s really a winner take all model, you would beat like Gumtree or were Craigslist and so on. Once you get there, it’s very hard for competition to get in and CGC marketplaces tend to be this way. So that was the first phase. Then second phase started not long ago, actually in 2017. It was what I just described earlier was recognizing that now you have like close to Today we have 90 plus million members. And actually, they come with no marketing. They come because of the brand and the community. And you realize that actually, we could build a much more by starting to connect buses and trains onto the same platform and just expand, if you like the share of wallet of those users by offering more than enough transport. So since 2017, the strategy has been more of a product expansion strategy. So if you look, we launched new countries since 2017. And we acquired Nokia, but essentially no company in other countries. It was all about product expansion. So we acquired to bus company, we acquired like a short distance corporate in company, and it was your meant to just add supply. So and that’s what we’re doing. So we are in that phase of sort of like product expansion or offer expansion. And, yeah, that’s what we that’s what we were doing now essentially. So it’s more like, and maybe I should say that but m&a should always feed your dominant strategy. So you should never use mmm For sort of tactical move or operational improvements, so it’s essentially your core. If you if the obsession of the company is to go international m&a should support that the core obsession of the company is to build more supply and become multimodal m&a should support that. And that’s been. That’s been our story we’ve done about 10 acquisitions in the last seven years. I think.
Kevin May:
You saying going international reminds me of a question that perhaps I should have asked a bit earlier on. But in those early days, when you were branching out from France into other countries in Europe, what kind of if any regulatory difficulties did you face? And that’s the I guess that’s the first question and the second one is, you know, and I know a lot of the the concept is around the ratings of the driver and the rating to the passenger. So they’re, they’re seen as good passengers, and good Drivers but in that really early phase, you don’t have many ratings. So was there a sense of nervousness that something might go wrong to a really terrible extent whether it is for a passenger or driver. So just kind of talk us through how you kind of dealt with that as a as a founding team as well as the any kind of regulatory issues that you had to get over?
Nicolas Brusson:
Yeah, regulation has been, it’s been interesting because essentially we are true CGC marketplace. And the way it works is drivers do not make a profit. And in pretty much any country where we went there is a pretty good definition of what’s making a profit. If you go to the US it’s going to be your VIPs so it’s going to be HMRC in the UK saying, hey, if you make more than the UK as an example, in the UK, but HMRC will tell you, if you make more than 40 I think 40 or 45 cents per mile. With your car. You are making a profit. If you making less than 40 or 45 cents, I can’t remember the mile actually sharing the cost of your vehicle. So it’s like the cost of your petrol you put in the vehicle, depreciation of the vehicle insurance and so on and so on. And essentially, we always operated below that bar of 40 or 45 cents per mile in the UK. And same thing in Germany, Spain, France, and so on and so on. So, and it’s been pretty fundamental, especially at the time where ubirr was launching things like Uber x, Uber pop, and they were launching this sort of citrusy Uber, it became like that your massive regulation issue in most countries because people said, well, that’s illegal taxi. It’s just like a guy with a car transporting people professionally. It turns out that you encorporate if you do that for long distance, you can actually irrationally stay below that threshold. Because if you think of 45 cents per mile, it means you’re London Manchester is like 200 miles. So actually means you can collect as much as 90 pounds. To go from London to Manchester, and you can get like four passengers paying roughly 20 pounds per passenger. And it’s still pretty good video, right? It means if you do a round trip, as a driver to Manchester, you could collect as much as 90 pounds on the way to Manchester as much as 90 pounds on the way back. And all of that being below that threshold of making a profit. And it’s been one of the fundamental difference, I guess, between your ride sharing, or what’s been called ride sharing, which is Uber Lyft. And all these sort of like in city ride hailing activity, and what we do, and I guess Thanks to that, actually, we’ve been immune to a lot of regulatory issues in cities and countries. And it’s really it’s not like a sort of an untold story, but we we had very few issues. And so far we’ve won every lawsuit we had to get like a couple of lawsuits in, in Russia. We had a couple of lawsuits in Spain. actually trying to Make the record illegal, more regulated, and always failed essentially on that basis on the fact that actually drivers don’t do that as a professional activity, they would do that trip anyway with an empty car. And they’re making an amount of money that’s below that threshold of your the average cost of using the car. And the beauty of it is we’ve built the entire activity below that threshold. And generally, it’s again, it’s a C to C and not a b2c activity. So if you take a brother call the driver is never going to be a professional guy. Driving around with a van between London and Manchester. It’s just gonna be a genuine driver. That happens to go to Manchester for XYZ reason.
Kevin May:
I’m interested you said very early on in our conversation about you know, investors didn’t really get it and then all of a sudden, the sharing economy just kind of knew up here around 2010 do you think you’ve been given get enough credit for being a part of that, given that so much attention is given to the likes of Airbnb and Uber and Lyft. And, and brands like that because one you were around before all those folk and two, it is ultimate sharing economy isn’t it’s people that are doing as you say, not profit. But you’re rarely mentioned in the same breath.
Nicolas Brusson:
Yeah, yeah, it’s I think we get lots of credit for that knowing we don’t operate in the US right. So I think if you look at the if you look at the the number of mentioned, mentioned we have in in US press when they talk about the sharing economy and so on for a service that does not even exist in the US that US consumers cannot even try. I think it’s pretty good in Europe. You were written for us in Spain in Germany, Italy. Well known actually, so let me just because you have millions of people using it, it’s a lot less used in the UK and absent in the US. I think that’s why in English speaking price, you have a bit of a brand deficit because we don’t have a consumer reality in those countries. And I think it’s pretty hard. It’s the same way like companies like Alibaba has been around them, they huge and people discovered that Alibaba is a giant company just a couple of years ago, because and even if you walk around the US or Europe and you talk about Alibaba, Tencent, or these companies, no one really knows so. So the lack of consumer reality in the US probably did that. On the investor side. It was not the case of so so since I would say 2013 or 14, we’ve been on the radar of us investors. So it really changed around that time. So really saw that as a as a very interesting A European play, and very quickly also, so that is a very interesting emerging market play. Because we had launched many countries outside of both Europe, Russia, Brazil, Mexico, and so on. And it was kind of an interesting play in that sense.
Kevin May:
Just a quick one for me before David comes back again, I mean, the Rebus acquisition from SNCF. I mean, was that a difficult one to do? Because it was from us, you know, such a large organization, a state owned part, state owned company, and all those kind of things. Yeah. I mean, on the one hand, you could think just don’t go there, because there’s going to be an absolute nightmare. But obviously, it was just strategic and good thing to do. But just the mechanics of the acquisition, I suspect, maybe caused a little bit of perspiration on the forehead.
Nicolas Brusson:
Yeah, no, no, no, it was I mean, it was not an obvious deal to do. And, and I’ll get back to that in a segment maybe you if we put a minute on. You. I guess the importance of Tech and internet players have seen the the evolution of the bus market in Europe is a prime example. So you that market liberalized as you said, like five, six years ago, not even I think if you and I had that discussion five years ago, we would have said like, well, you it’s going to be first group from the UK or mega boss is going to move in and then it’s going to be SNCF and Dutch Oban and those companies are going to dominate the space market because there’s just a natural extension to trains. If you look at now in Europe, essentially five or six years later, just looking at the bus market, you have two companies let her left standing flicks bus and us right and that’s two companies that essentially denote a very single bus with a single train five or six years ago. So we began from for putting the started fix bus from on that promise. And that’s pretty interesting how it shifted you want like symbols of together The world is shifting toward was platforms and was internet companies. Just because the model was more flexible. We don’t own the boss, we don’t hire directly the bus driver. It’s a much more flexible model. So those two companies dominate. So having said that, so, for us the way to enter this market was even rebuilt from scratch. So it was two years ago when we started to look at Viva. So we go by acquisition. And in fact, the only company that was interesting, at least in fosse was Rebus. And initially, we didn’t think about that because we felt like okay, requiring a company from SNCF makes no sense they’re not going to want to sell number one and number two, it feels like like a headache. And, and it came almost by accident that we we met with the guys from Rebus and they told us like, well smsfs changed its strategy and and essentially they want to sell all the non train assets. And we both you eventually we was going to have to go. And we felt like wow, okay. That’s interesting because you would think of SNCF, maybe I mean, you could fantasize about the lessons of buying a black car or buying stuff from SNCF, especially in the tiny French market. He feels a bit awkward. And that’s what happens when we engage with rivermen. Yes, we ended up buying that strategically makes tons of sense. I was discovered this way disseminate very interesting, strategically made tons of sense. Culturally, you would say you, it’s a French company, we are French educated. So it’s easy. But actually, culturally, it was a massive gap, right? Because you end up with people from SNCF. And, and they’re just we had to adjust and there was some obviously heavy lifting in the first six to 12 months, essentially, you’re adapting processes and the way we work versus West and South work. So, so culturally, it’s been one of the most challenging m&a we’ve done. We knew it moving in. So it was kind of the the cost of it. And that’s often what people forget about m&a, they tend to be overly focused on Strategy and Finance as they should. But then to miss the the post merger integration side of things, which is like very much HR and people. So we had to invest a lot essentially, like you creating common grounds common cultural common processes over the last the last 12 months, but now it’s mostly actually behind us. But yes, it was a it was an interesting experience, I would say, de
David Litwak:
novo. So I wanted to touch a little bit on something you said earlier as well, which is use you joke that most people view European startups as people just trying to get a head start on an idea that’s already worked in America. And I liked how you phrased that it was it wasn’t like Well, how do you make carpooling work and Francis how, why does carpooling work in America? And I think, you know, I think that that’s changing. And it kind of just mentioned that, like, I know that you mentioned Alibaba. And I think that in tech circles, there’s a lot of obsession about analyzing Chinese companies like pin Duo Duo and others these days, and like, why did they work in China? And like, what does that mean for x in America or in Europe? And I feel like the lesson for me from that is that eventually, you know, we’re all the same, we may have certain cultural differences and regulatory differences that lead to certain regions to be more primed for certain models to arise. But in general, we almost always revert to you know, doing the same stuff. challenger banks is kind of another example. So it’s kind of a philosophical question here. How do you conquer the US market? Like theoretically, if not, now, in a few years, what either has to change in the US market or what in your strategy has to change to actually make carpooling and blah, blah car successful in the US?
Nicolas Brusson:
It’s a very good one. So I agree with you. I don’t think you’re cooperating is never going to work in the US. I think the product was built initially was not the right product for the US and the US was maybe more complicated to crack and no one has cracked it. So for me to prove that it’s not that simple, because it’s the country of startups and venture capital and entrepreneurship, so it was easy to crack, they’ve been cracked. That doesn’t mean it’s never going to be cracked. And in fact, you I think the new product we launched just a year ago in fast blabla lines, which is incorporating applied commuting. Next a lot more sense with us actually, right, because a lot of people commute by car pretty long distances actually, in the US. So there is a lot of action in commuting and it’s a lot easier to do like a true door to door on commuting because you people connect and eat and then you create some sort of like teams of people that start sharing along one on one for example, in the in the Bay Area. So So I think it could be like commuting and short distance. carpooling could be a very interesting entry point into it. To the US. Having said that, there are a few companies like shivers, a company called scoop in in the Bay Area
David Litwak:
about asking about them.
Nicolas Brusson:
Yeah, so I haven’t tracked recently we had prior discussions with them. I mean, essentially, not that many cooperating company. So we ended up knowing each other. And but Rob and john have done a great job actually cracking that use case of commuting in in the Bay Area. And I think even beyond now, and I don’t know how big it get to you and where they are exactly, but I think they have like a nice business model that gets some good traction. And I think that’s probably the way to craving US market. Your lead See also what’s going to happen like Pascucci that we see the COVID crisis of spread be slowed down, or this shirt transport them in for us and for buses, and planes and trains. So let’s see, oh, it’s going to bounce back in 2021. I think 2020 is bizarre your return to track liquid Doing well he’s not doing well and what behaviors are doing because it’s so
challenged by by the crisis we’re going through but
I would say the signs were very positive on on scoop and short distance carpeting in the US so bad maybe the the entry door.
David Litwak:
One last one before I turn it back over to Kevin to wrap up here. You said something that I think I understand is true in France. I think almost anyone outside of France or at least a few European countries would would raise their eyebrows that you said fantasize about SNCF buying blahblah car, not bla bla car buying assets from SNCF. And the idea you know, coming from America of having a government institution being innovative enough to actually be acquisitive is absolutely foreign. But I realized it’s not a uniquely SNCF thing. I remember you know, a few years ago, I was in Paris, me with our ATP, and found out that they had sold a lot of their technology and their operational expertise too much of the Francophone region, and all over running public transit networks all around the world and The idea of you know, New York City metro. You know, franchising our operations is just comical. So like, I guess it’s kind of a wider cultural question, what is it about, you know, France and your guys kind of system of entrepreneurship that makes that actually a realistic acquisitive path?
Nicolas Brusson:
Yeah, I mean, maybe you want to say fantasize It was not in a video was was misleading you me it was not. It was not my dream to be to be acquired by sunset, I would take within the the range of possible because it’s a massive company with a message balance sheet. So in theory, it’s possible in practice, SNCF is never going to go and buy your company like that by car because it’s a, it’s subsidized by by taxpayer. And I mean, they don’t do these big m&a. So in reality, it’s not even in the realm of, of possible and we never even entertained the discussion that people would have expected like SNCF to buy stuff from Black Hole by their coin the early days, Robert Then they’re called buying stuff from us and says feels, it feels a bit awkward, a bit awkward talking maybe more broadly about the European and specifically the French ecosystem. You know, I mean, clearly does improve a lot in the last in the last five years. So I think and obviously, there is lots of funding everywhere in the US and in China. But Europe has done fairly well that we take catching up and there was a lot of catching up to do. France weaving Europe has done pretty well and the government and back home clearly pushed to that. I think he’s been pretty proactive and trying to attract talent to attract capital in France. So France has sort of like closed the gap with with most countries in Europe. In fact, it’s one of the leading place today. In terms of venture funding. Yet, I think you should take a step back. Europe is still pretty far behind us and China in terms of like new building, respect. If companies and you 1010 plus billion valuation and so on and so on. I mean, you see a lot of that from China, a lot of that from the US. I mean, you’re still counting these companies in Europe. So I you, I hope that you the current crisis we’re going through is not going to slow down the momentum we have in Europe, because the truth is we have lots of catching up to do. And it’s not just France, it’s really, Europe in general has a lot of catching up to do on technology. I mean, to me, yeah, having spent a lot of time in Silicon Valley and then in London, it feels like in Europe, politicians discovered a couple of years ago that tech matters. And it was in use just recently, I think was last week a couple of weeks ago, that the valuation of Apple is as big as the French index composed of 40 different companies. So we will see the CAC for you which is like L’Oreal and the talent, so on. The son of that index, the French stock index is equal now a bit smaller than apple. Right? So technology does matter. and Europe is waking up to that fact a bit late, but at least it’s it’s, it’s on the right track. But, but we need baby, and I’m going to sidetrack a bit. But we need actually smarter regulation in Europe. If we want to push more technology in Europe, I think today, most of the regulations in Europe a bit naive technology. A
Kevin May:
couple of quick points for me then, Nicholas, before we wrap up, I mean, we haven’t mentioned that you didn’t actually start out as the CEO, you are now the CEO. I mean, talk to us a little bit about that transition. And presumably It was a position we’re happy to take because you’re sat here in front of us as the CEO but it’s quite a it’s it is quite a leap to take. What was it ambition or was it a natural thing for you want to want to do that though
Nicolas Brusson:
it was, it was sort of a natural evolution of our walls within the companies too. So basically, we started by cars, three co founders. And until 2016, essentially, we manage that car as like a team of three. So essentially, we were the three founders were three of the board members with three shoulders, but we were also the executive committee of that car. So essentially, any operational tactical decision was taken by us three together. We realized, though, that around 2016, that as the company grew, that he began pretty inefficient as a model, essentially, it was like, it was like a tripod of three founders beating the company in three. And you Fred was managing product communication, it was managing international finance marketing forces, one was managing technology. So it was kind of this split of skills and what we like to do, but we had no Executive Committee, so Were restructured as the founders, the three guys were taking all the decision. In 2016, we realized we need to formalize the wall a bit more. And we need to formalize like a CEO role and build like a real executive team with like a CEO or CFO, and so on and so on. And that’s what we decided to do in 2016. So it’s actually been more for a natural transition, actually. So from the outside, it feels like oh, well, we can be changed change of CEO. In fact, it was more of a natural evolution between the three of us where my jobs didn’t really change overnight. And, and fed them policies actually stayed for quite some time and phased out very gradually. And right now, they’re still obviously founders are still board members. We’re still shareholders. We still have a founder meetings actually, every month. But from an execution point of view. I’m the CEO, I have my executive team and that’s how I make I make sort of the daily decisions. If you like.
Kevin May:
And you’re the one who gets to come along and do podcasts like this with us, which is, which is which is great. So quick one then. And a lot of people might not know this, but what is the what is the story behind the name? I think it’s a great story and the reason why but there’ll be many people that are tuning in who don’t know the reason why you’re called bla bla.
Nicolas Brusson:
And yes to two small anecdotes actually on on that. So. So we started as something called covert trials that fr, which again, it’s carpooling.com, which was great because it says what he does. So from an SEO point of view, it’s easy and people don’t at least understand what what the product is supposed to do. But it’s very weak because a you cannot go international obviously. So you have to stay in France with such name. And be even if it was not the case, descriptors are very weak brands, so they could stick being called a car to a car note. We call that BMW something else. So we decided to change and, and back then actually, we had no idea how to name this thing and not much money. And we every time I was using the product, I was asking people like, Okay, what product Have you used? Because back then there were like, lots of core printing website with tiny classified doing that. And people were always like, Oh yeah, I used the website called carpooling, something, incorporating something and they could never spell the name. And then I asked them, like, Okay, what was the color of the logo and like blue, green, red, they never remembered that. But they always remember like, a, that’s the the service where whenever when I when I sign up, actually, they asked me if I’m talkative or not, and I have to choose within my profile, a blah, blah index. So I need to decide if I’m a blogger, and I don’t want to talk in the car, and blah, blah because I’m normal with and blah, blah, blah, and it’s all about social. And we were like, literally we put that feature in that blah, blah was just something like it was not even foot through back then it was just a thing we had like smoking, non smoking pet, no pet and we had bla bla bla bla bla. And people remember that too. And I can discuss before like, that’s really interesting. Like they don’t remember the name they don’t remember the color of it kind of gives you like your like, I’ll give you anything except that one feature that’s almost anecdotal in the entire flow of booking, booking a ride but seems so important. So so we thought, okay, because it’s so much about social experience in a way and these blahblah is an icebreaker of sexual discomfort in a way we thought okay, that has to be part of the name and the story. And we change that to to blablacar and remember, like one peach fever. You see, I won’t name when we renamed that Corey satellite where we have such a name. You’re never going to be a billion dollar company. And
they guess we have Yeah.
But anyway, so that’s the story, the story of the name. But that’s also just maybe in a in 10. sec. That’s also the beauty of that series your was describing that as we work on trust and connection and not on the transport network. But that Korea is enabling actually millions of people to connect for 234 hours, when in fact, they were not meant to be connected. So we ended up new social media, we’re not meant to to talk to connect. And within the social media, they probably have like very different feed on Facebook and Twitter and so on. Pinterest or whatever. So it’s very interesting, because it’s a massive social experiment where, especially in those sort of political tense days, where you put like three, four people together with very different political views, and then you’ve run a survey alone. And people get can go check that, which is fascinating, where we see that 80 plus percent of user said blowback or was an enriching experience carry you would not say that of taking a plane or train 50% of people say they’ve changed their mind on something, taking a black car. And even crazier 20% of people said they revealed something some kind of like a secret quote unquote, you know, blah blah car but they have not told their friend. And we’ve done that on like 10s of thousands of people surveyed in 10 different countries. And the reason people do that is you think after the record, you end up spending like three fires with someone you probably won’t meet again. And you end up talking for three four hours it’s a long time take a lot longer than the podcast it’s a very long time to to talk to someone and you’re not facing each other in a car. So you just like you’re looking at the road, just like a drink. And and people tend to go off and and tell her tell amazing stories. You know, so? So we say the beauty of the services, obviously the environmental impact, but also that social element. Yeah.
Nicolas Brusson:
We certainly connect people not going to be coming.
Kevin May:
Certainly blah blah car is a lot catchier than psychotherapy car, isn’t it?
Nicolas Brusson:
Exactly.
Kevin May:
Okay, that’s all. That’s all we’ve got time for. I’m afraid. Oh, I I am curious. You can just say yes or no, if you’re like, I’m assuming you’re aware of the British sitcom. carshare. Presumably.
Nicolas Brusson:
TV one was the name it was? Yes. Yes. Yes.
Kevin May:
Okay, did you like that? Because that almost thrust the whole concept of car pooling and car sharing into the, into the consciousness of interviews in cars
Nicolas Brusson:
and so on. Yeah. No, no. Yeah, indeed.
Kevin May:
Okay. Right. That That was great. Thank you so much for joining us, Nicholas. Thank you. Thank you. Okay, so that was another really great interview and great episode of how I got here. These are mosey on focus wise, weekly podcast. interviews with entrepreneurs and innovators in travel and transportation. Thank you very much for listening. If you’re not a subscriber, you can do so on all the usual platforms. That’s iTunes, Spotify, Amazon, Alexa and Google podcast leave us a five star review. We always like to hear your feedback and see people give us lots of great ratings. So thank you very much in advance for those. Thanks again to Nicolas. And on behalf of David and I thank you very much for listening to how I got here. We’ll see you next time. Thanks a lot.
Transcribed by https://otter.ai