If you missed the webinar with FetchCar's co-founder, Koosha Kaveh, we’ve summarised some vital information about FetchCar in a Q&A session.
1. How is Zipcar in comparison to FetchCar in terms of trip costs? Additionally, what are the reasons behind Zipcar's decision not to offer pickup and delivery services similar FetchCar?
FetchCar: When comparing FetchCar with Zipcar in terms of trip cost, there are a few factors to consider. FetchCar's pricing consists of three elements: delivery, usage, and pickup. The usage cost of FetchCar is exactly the same as Zipcar, so there is no difference there. However, FetchCar does add a £5 delivery fee and a £5 pickup fee to every trip. This makes FetchCar £10 more expensive than Zipcar for each journey. However, the added value FetchCar provides to customers is worth much more than £10. With FetchCar, the car is guaranteed to be in front of your door at the specified time, something that Zipcar cannot offer. The reason Zipcar cannot provide this service is because they lack the necessary technology. The alternative of delivering a Zipcar manually with a person inside is not economically viable, as the cost of sending someone to the car, driving it to the customer, and returning is likely higher than the cost of the Zipcar itself. Thus, without advanced technology, no other car-sharing company, including FetchCar, has been able to offer the same level of convenience and efficiency.
2. What will prevent car rental companies from offering the same service?
FetchCar: The main barrier for car rental companies to offer a similar service is the technology involved. Developing the necessary technology, which took FetchCar four years and resulted in three existing patents with five more patents in the pipeline, is a significant challenge. Car rental companies would either need to invest in building this technology themselves or consider acquiring FetchCar. Acquisition is one potential exit option for FetchCar in the future. As the service scales, FetchCar may choose to sell the company to a large car rental company like Hertz or Avis, or to ride-hailing companies like Uber and Bolt who are interested in adding a car-sharing option alongside their taxi services. Another potential buyer could be original equipment manufacturers (OEMs) such as Nissan, Hyundai, and Renault, who may want to incorporate this technology into their own vehicles.
3. According to FetchCar, is remote driving a gray area in the UK? What is fetchCar's take on it in the future in the UK and the US?
FetchCar: When comparing FetchCar with Zipcar in terms of trip cost, there are a few factors to consider. FetchCar's pricing consists of three elements: delivery, usage, and pickup. The usage cost of FetchCar is exactly the same as Zipcar, so there is no difference there. However, FetchCar does add a £5 delivery fee and a £5 pickup fee to every trip. This makes FetchCar £10 more expensive than Zipcar for each journey. However, the added value FetchCar provides to customers is worth much more than £10. With FetchCar, the car is guaranteed to be in front of your door at the specified time, something that Zipcar cannot offer. The reason Zipcar cannot provide this service is because they lack the necessary technology. The alternative of delivering a Zipcar manually with a person inside is not economically viable, as the cost of sending someone to the car, driving it to the customer, and returning is likely higher than the cost of the Zipcar itself. Thus, without advanced technology, no other car-sharing company, including FetchCar, has been able to offer the same level of convenience and efficiency.
4. Have there been any safety incidents in FetchCar's rollout in Milton Keynes?
FetchCar: No, there haven't been any safety incidents to date in FetchCar's rollout in Milton Keynes, even after covering more than 1000 miles of driving. Safety is a top priority for FetchCar, and they have implemented various measures to ensure a safe experience. Over the past four years, FetchCar has focused on developing technologies centered around three safety pillars. The first pillar is prevention, which includes measures such as utilizing multiple mobile operators simultaneously to ensure continuous connectivity. They have also developed navigation based on connectivity, prioritizing routes with the best network coverage rather than the shortest distance. The second pillar is adaptation, where FetchCar has developed technologies to dynamically adjust the data transmission to ensure a smooth and uninterrupted video streaming experience for remote drivers. This real-time adaptation prevents frozen videos or connectivity issues. Finally, FetchCar's ultimate safety layer is the "minimum risk maneuver." Similar to airbags in cars, this mechanism is designed to activate in rare and unforeseen events. If all four operators experience an unexpected loss of connectivity, the system executes a minimum risk maneuver to bring the car to a safe zero stop, ensuring it does not pose any safety hazards. This feature is being developed to meet automotive standards and will undergo certification. With these comprehensive safety measures in place, FetchCar has been able to maintain a strong safety record during its operations in Milton Keynes.
4. How does FetchCar compare to Zoox, an autonomous driving company?
FetchCar: Zoox is indeed an autonomous driving company, similar to Cruise and Tesla's aspirations for autonomous vehicles. These companies rely on AI-driven vehicles, equipped with over 100,000 sensors. However, their current capabilities are quite limited. Zoox, for example, operates within specific operational design domains, limited geographical areas, and specific timeframes due to the need for extensive data mapping. Autonomy faces several challenges that hinder its scalability. One key challenge is the requirement for highly accurate 3D mapping, which is costly and necessitates constant updates. Additionally, autonomous vehicles rely on expensive sensors but still struggle to make accurate judgments in all situations. They face difficulties operating in adverse weather conditions such as fog, rain, or snow, and may struggle to distinguish between a police officer and a pedestrian. The sophistication needed to overcome these challenges is still lacking. FetchCar does not consider Zoox and similar companies as direct competition. While they focus on autonomous or driverless Uber-like services for short distances, FetchCar's objective is to provide users with an empty car that can be driven for long distances or kept for multiple days. The use cases and capabilities of autonomous vehicles are fundamentally different from what FetchCar aims to deliver, and it may take decades, if not longer, for autonomous vehicles to match the versatility and scale of FetchCar's offering.
5. What factors would FetchCar take into account when considering expansion into a new city in the UK? Would Zipcar's existing presence impact on the decision-making process?
FetchCar: FetchCar considers several factors when selecting new cities for expansion. One key consideration is proximity to their existing operations. For example, if there is a demand from customers to drop off cars at airports like Luton or Stansted, FetchCar would prioritize expanding to those areas. These airports are often challenging and expensive to reach, making FetchCar's service particularly attractive. Another factor is the size of the market and the level of competition in a particular city. While Zipcar's presence may be taken into account, it is not a primary determining factor for expansion. In fact, FetchCar aims to target areas where the Zipcar model may not be viable. The Zipcar model relies on densely populated urban areas, such as Zone 1 in London or city centers like Manchester and Birmingham. FetchCar, on the other hand, can provide a profitable service in any city or area, regardless of density. This includes suburban areas and smaller tier two or tier three cities, which may not have access to similar car-sharing options. FetchCar's strategy involves expanding to places with minimal competition, where they can leverage their delivery model to provide convenient and cost-effective car-sharing services.
6. How will FetchCar's service work in crowded and chaotic city centres in the UK?
FetchCar: FetchCar's service is not limited by road conditions or the level of congestion in city centres. With remote driving, the human operator is located in a control room rather than being physically present inside the vehicle. This allows the operator to make driving decisions and navigate through various road situations, whether it's narrow roads, roundabouts, or traffic lights. Therefore, the crowded and chaotic nature of city centres does not pose a significant challenge for FetchCar's operations. Their focus is primarily on assessing demand and determining whether they can effectively solve transportation problems in a given city. While it is true that cities with excellent public transportation, like London, may have alternative options for people without cars, FetchCar prioritises cities where owning a car or having access to one is essential. These are the areas where FetchCar's service would be of high demand and a priority for expansion.
7. How does FetchCar price their service for customers who want to borrow a car for the whole day?
FetchCar: FetchCar offers three different packages to accommodate various use cases. For customers who need a car for less than an hour, there is a "by minute" package. This is suitable for short trips to places like grocery stores or train stations. The second package is an hourly package, which is the most popular option. It caters to customers who require a car for one to eight hours, with pricing set at £13.99 per hour. FetchCar also offers a daily package, priced similarly to the hourly rates. Currently, they aim to price their daily package slightly lower than traditional car rental agencies. This allows customers who need a car for a longer duration to choose FetchCar over other options such as car sharing or traditional taxis. The goal is to provide flexibility and competitive pricing across all three packages to cater to the diverse needs of customers.
8. Is the cost of insuring the vehicle higher in FetchCar's scenario?
FetchCar: The insurance cost for FetchCar is slightly higher compared to a regular car insurance. This is because FetchCar not only insures the car itself but also covers the aspect of remote control operations, which carries an additional risk. However, the premium increase is not significant enough to greatly impact FetchCar's unit economics. FetchCar is actively working with their insurance company to share data and demonstrate that the new technology does not pose an excessively higher risk. This collaborative effort helps the insurance company accurately price the coverage based on the actual risk involved. As for the situation where a car goes off-grid with FetchCar's kit, the terms and conditions of FetchCar's service are similar to those of traditional car rental companies. Users assume responsibility for the rented car, including situations like theft. If a car is stolen while under a user's possession, it falls under their responsibility, just as it would with a rental car from a company like Hertz. Users are expected to comply with the terms and conditions, which outline their responsibilities during the rental period.
9. How does FetchCar plan to deal with recent EU gig workers' rights if they expand beyond the UK?
FetchCar: FetchCar's next expansion plan after the UK is to enter the EU market. When expanding into new regions, FetchCar will comply with the regulations and rules in place at that time. Currently, FetchCar employs people directly rather than utilizing gig workers. However, one advantage of FetchCar's technology is that remote drivers can control cars from outside the country. This means that remote drivers could be trained and stationed in the UK but remotely operate cars in other countries, such as having drivers in the UK operating cars in Germany. This approach offers scalability and cost savings in terms of wages, as different regions may have varying wage levels. FetchCar will explore these possibilities in the future, while ensuring compliance with any regulations related to gig economy workers that are in effect. Adhering to the rules and regulations of each country and prioritizing compliance will be an integral part of FetchCar's expansion strategy.
10. What is the current enterprise value of FetchCar and how do you determine your valuation?
FetchCar: FetchCar's current valuation is based on several factors. Firstly, their previous valuation was £12.5 million, which was established when they had a prototype but no product or paying customers. Since then, FetchCar has made significant progress towards commercial launch, leading to a higher valuation. Currently, their valuation is represented as a valuation cap of £18 million with a 20% discount. This means that any investments made based on these terms will be adjusted to the next price round. If the next valuation round is higher than £18 million, the investment will be capped at that amount. If the next round is lower, investors will receive a 20% discount from the lower valuation. Additionally, FetchCar considers the valuations of their competitors. Their US-based competitor recently raised funds at a $60 million valuation, and their German competitor secured significant funding at an undisclosed valuation. FetchCar's current valuation is positioned lower in comparison to their competitors. As FetchCar continues to grow and achieve milestones, their valuation may evolve in the future.
11. How does FetchCar envision the valuation growing over time?
FetchCar: The growth of FetchCar's valuation over time depends on several factors. One key factor is the progress they make in advancing their technology and reaching the point where safety drivers are no longer required. FetchCar has a roadmap to achieve this milestone within 18 to 24 months, which would result in a significant increase in valuation. Additionally, the company's commercial success and ability to generate revenue and achieve profitability will also impact its valuation growth. While it is challenging to provide exact figures for future valuations, a general rule for startups is to aim for doubling their valuation each year, especially during the early stages until the Series B funding round. If FetchCar's current valuation is £18 million, they would aim to double it by this time next year. However, actual valuation growth will depend on various market conditions, technological advancements, and the company's performance.
12. What potential exit scenarios does Fetchcar see for investors in this round?
FetchCar: FetchCar envisions three potential exit scenarios. The first is a buyout by a car rental company, such as Enterprise, Hertz, or Sixt. This would allow the car rental company to integrate FetchCar's technology into their fleet, gaining a competitive advantage. The second scenario is an acquisition by an automotive manufacturer, such as Hyundai or Nissan, who would be interested in incorporating FetchCar's technology into their production series. This pathway often begins with partnerships with various automotive manufacturers, leading to a potential acquisition offer. The third scenario involves fleet operators in the ride-hailing business, such as Uber, Bolt, or Lyft. Adding car rental services to their portfolio would be a natural extension for these companies. Currently, it is not possible to order a car rental through apps like Uber, so FetchCar's technology could fill that gap. These three options represent the primary potential acquirers in the near term, within the next 2 to 3 years. Additionally, autonomous vehicle companies may also be interested in acquiring FetchCar, as they would require the technology for human takeover when their AI systems fail. However, FetchCar's plan is not solely focused on acquisitions. They aim to create different revenue streams, including licensing their technology to potential acquirers as partners. Ultimately, FetchCar's long-term goal is to pursue an IPO (Initial Public Offering) in 5 to 10 years, providing an exit opportunity and realizing the ultimate aspiration for many entrepreneurs.
13. Can you provide more information about customer acquisition and the ratio between Imperium-operated cars and franchisee-operated cars in the future?
FetchCar: Currently, FetchCar's primary customer acquisition channel is digital, with a strong focus on Instagram advertising. They highlight the unique service of having a car rental delivered to your door with just a click, offering first-time discounts to attract new customers. The approximate customer acquisition cost is £25 per customer, which is considered favorable as the revenue generated from a few trips covers this cost.
14. What are FetchCar's plans for the Middle East region, particularly the UAE?
FetchCar: FetchCar is actively considering expansion into the Middle East, specifically Dubai and Saudi Arabia. They have been in discussions with Middle Eastern car-sharing companies based in Dubai and are exploring potential pilot projects in the region. FetchCar is also initiating talks with the RTA (Roads and Transport Authority) in Dubai to facilitate their operations. The company sees the Middle East as a promising market for shared mobility, with recent growth in the sector and a supportive attitude towards new technologies.
15. Will FetchCar's technology be available for offline use in the future? Are there plans to white label the solution for other providers?
FetchCar: FetchCar's technology relies on wireless connectivity for remote driving operations. Currently, it requires a stable internet connection to function effectively. However, the company is exploring options to enhance offline capabilities and improve reliability in areas with limited connectivity. As for white labeling the solution, FetchCar is open to licensing their technology to existing car sharing and car rental companies. This means that they would provide the necessary equipment and support, while the partner company's brand would be used to offer the service. Through licensing, FetchCar aims to enable other providers to offer their customers the convenience of immediate car rental delivery.
16. Is the plan to have Fetch as a separate legal entity from Imperium?
Fetch is the trading name of Imperium Drive Ltd. It is included within Imperium and not a separate entity.
17. What about internet area coverage risk?
To mitigate the risk of limited internet coverage, FetchCar employs a strategy that combines the internet coverage of all four network providers in the UK. Prior to launching the service, FetchCar gathers data to identify areas with poor coverage and actively avoids those roads or areas. This helps ensure that the service is primarily offered in areas with reliable internet connectivity.
Additionally, FetchCar has established partnerships with network providers like Vodafone and others. These partnerships enable FetchCar to access priority data allocation, giving them a higher level of service and data availability compared to regular users.
18. Will the drivers be based in another country to reduce costs and be more efficient?
The drivers for FetchCar will be based in the same country where the service operates, primarily due to regulatory reasons.
19. Will there be any fail-safe mechanisms in place to address potential safety concerns associated with remote-controlled vehicles operated by gig-workers?
Ensuring safety is a top priority for FetchCar, and the service has implemented several measures to address potential safety issues. First and foremost, the cars utilised by FetchCar are equipped with built-in safety features. These safety features are designed to mitigate risks and provide safeguards in case of emergencies or unexpected situations.
Additionally, the speed of FetchCar vehicles is limited to a maximum of 30mph (miles per hour). By capping the speed, FetchCar aims to maintain a controlled and safe operating environment, reducing the likelihood of accidents and minimising the severity of any potential incidents.
20. What is the current user base and customer retention rate for FetchCar?
FetchCar has achieved a strong customer retention rate, with approximately 93% of users returning for the service. This indicates a high level of satisfaction and repeated usage among the customer base. As for the current active customer count, FetchCar has around 650 active customers who regularly utilise the service.
21. What is the current market value of the company?
Current pre money valuation is £18 MN SAFE cap with a 20% discount.
