Bengaluru-headquartered car-sharing startup Zoomcar is revving up expansion plans across Southeast Asia, with Vietnam, Indonesia, and the Philippines as the primary target countries.
Launched in 2013 by Greg Moran and David Back, Zoomcar enables individuals to rent vehicles from a diverse pool of more than 10,000 cars by the hour or day. Zoomcar works with individuals and SMEs that source cars to share on the platform. The firm also offers mobility solutions to car dealers and fleets.
In November, Zoomcar collected USD 92 million in a financing round led by New York City-based SternAegis Ventures to fuel its expansion plans in markets across Southeast Asia, the Middle East, and North Africa. Weeks before this announcement, in October, Zoomcar began operations in Egypt and in the Philippines. Last week, the company announced that it will start operations in Vietnam “shortly.” The firm’s Vietnamese business will be led by country manager and vice president Kiet Pham, who previously held senior management positions at Indonesian ride-hailing giant Gojek, India-based hospitality giant Oyo, and global consumer data firm Nielsen.
Zoomcar also plans to expand to Indonesia by the first quarter of next year. “It’s really about nailing these four new countries—Egypt, Philippines, Vietnam, and Indonesia—and preparing ourselves for more and more growth in India. Ultimately, we are also looking at an additional ten countries for next year,” co-founder and CEO Greg Moran, told KrASIA.
2022 might also see the company going public, according to Moran. “We definitely have plans to go public next year, and we are on track in that direction. We don’t have any fundraising plans prior to the IPO.”
KrASIA recently talked to Moran to unpack Zoomcar’s entry in Vietnam. He also discussed the company’s broader plans in Southeast Asia and the challenges of boosting growth in India.
This interview has been edited and consolidated for clarity and brevity.
KrASIA (Kr): What are Zoomcar’s plans in Vietnam?
Greg Moran (GM): We are super excited about entering Ho Chi Minh city and, ultimately, other tier-1 and tier-2 cities. The Vietnamese market shares many similarities with India, where local consumers are extremely knowledgeable and ripe for this type of personal mobility disruption. We expect to reach over 50% of the market share in Ho Chi Minh City and Hanoi to then expand into ten more cities over the next 18 to 24 months.
Like India, Vietnam is a country dominated by two-wheeler culture, with a low level of car ownership. The majority of the middle-class population in Vietnam owns a motorbike. Few people have a car, and they might use it only two to three times a month. Car owners can unlock passive income and encourage micro-entrepreneurship by renting out their vehicles.
Kr: What are other expansion initiatives in Southeast Asia?
GM: In terms of our soft launches, we plan to expand to Indonesia over the next month or two. Indonesia is the only car rental market that’s bigger than Vietnam in Southeast Asia. We also expect to enter Thailand later next year. Indeed, we are also hoping to be in Laos, Cambodia, and then Myanmar, provided that the macro environment supports it from a political standpoint. In terms of our medium-term strategy, Malaysia and Singapore are not emerging markets, so we would not prioritize them. Yet, every other market is fair game.
Kr: What’s your company’s main stream of revenue? Is Zoomcar profitable yet?
GM: Around 90% of our revenue comes from our consumer car-sharing marketplace. However, our mobility solutions offering has also been growing and is set to account for 10% of our business revenue in 2022. We are expecting to be fully profitable in the second half of 2022.
Having said that, I think we will prioritize heavy investments in the next 24 months. We want to get into 35 countries across the globe over the next two years.
Kr: What are some challenges when it comes to growing your company’s presence in India?
GM: Every marketplace relies on a certain supply-demand balance. We have seen how demand has consistently outstripped the supply dramatically in India. It was only until recently that we were able to get our supply growing quickly to be in line with the demand.
We need to be hyperlocal. Our business is geo-location-based, making geography, micro-zones, and ZIP codes in each city very important. We have to look at our business at a neighborhood level to ensure that we can have a balanced supply and demand.