Toronto-based taxi-hailing company Nekso is making its Canadian debut after launching in Latin America.
Nekso is a startup spun out of Toronto’s Blanc Labs, but its app of the same name was built and piloted in Venezuela last year. Taxi industries in the Dominican Republic, Ecuador, Panama and Venezuela endorsed Nekso, connecting a network of 550 licensed taxi companies with 9,000 drivers.
The taxi-hailing app currently boasts 150,000 users, facilitating roughly 400,000 rides per month. Although Nekso gained popularity outside North America, seven cities in Canada and the U.S. will soon be able to tap into the app in early 2018—offering a competitive alternative to Uber and Lyft.
“When we launched, we saw a bigger opportunity in Latin America at the time. But today, there’s a big gap in the taxi ride-hailing space in Canada,” said Kevin McLaughlin, Nekso’s VP.
“Even after all the disruption that Uber and Lyft have brought to the industry, the taxi market is still extremely fragmented,” he added. “We’re trying to digitize the analog information that taxi drivers have always used.”
Some taxi drivers are already connected to existing market offerings like Uber, allowing users to request a cab and be charged a metered rate. But McLaughlin explained Nekso’s partnerships with taxi companies and drivers means users can flag down a cab on the side of the road and hop in, no in-app request needed.
“Folks that take taxis sometimes want to take an Uber because they know at the end of the trip they can jump out and go. We are bringing that kind of convenience to the end of the taxi trip, along with the convenience of hailing a cab on the street.”
McLaughlin said Nekso’s embedded AI technology—dubbed the Taxi Beacon—uses real-time weather, event and traffic data along with historical demand to predict what areas of the city might need more drivers. The predictive technology isn’t offered to taxi drivers by any other company, McLaughlin said.
“Taxi drivers spend two-thirds of their day either looking for a rider or waiting for a rider. The Taxi Beacon can get them closer to the demand and get them more rides,” he said.
Nekso reported the demand-predicting technology is increasing daily rides by more than 25 per cent. Nekso’s payment technology is also taking the friction out of the typical taxi transaction of a cash exchange or credit card charge.
Toronto will be the first city in Canada to launch Nekso as apart of its North American expansion. The startup is aiming for a total investment of $25 million USD, a goal that’s been first fuelled by a capital injection by EVP. The new funding will add to the $6.5 million Nekso has raised since its 2016 launch.
“Nekso is a perfect example of a company that has taken advantage of Canada’s policies to innovate and solve global problems,” said Ray Sharma, EVP’s CEO, in a statement. “They’ve solved payment, solved the customer experience, and solved driver utilization using AI. We see Nekso becoming a world leader in mobility.”
The taxi industry in Canada is a $2 billion industry. For Nekso to crack into the market, they’ll have to work with licensed taxi companies and convince both existing drivers and riders to download their app.
The startup’s 75-person team is split between Toronto and Latin America. Nekso is currently used by drivers and riders across 22 cities in the four countries. In addition to North America, the app will also be expanding to four more countries in South America including Colombia, Peru, Chile, and Argentina.