Start a Rideshare Business and Get Your Profit

Starting your own rideshare company isn’t out of reach, you just need dedication and a solid and actionable business plan.

What is carpooling, and how does it work? Carpooling has been around for many years and is by no means a new concept. However, with the rise of new technology, such as having the Internet and GPS on handheld devices, what was once a basic arrangement between friends has blossomed into an entire rideshare industry worth billions.

Simply put, carpooling is when the driver of a vehicle transports passengers from one destination to another. There must be an agreement among the passengers to pay for the total ride costs, including reimbursing fuel expenses. Companies like Uber and Lyft have benefited greatly from this carpooling ideology and have created rideshare businesses that work on this very premise while taking it one step further.

Rideshare companies operate as a lift-hailing service, which is a company that matches vehicles and drivers with people who are in need of a ride. The passengers pay the company for the service, and the drivers take a percentage of the money as a “wage”.

Let’s take a look at some of the steps needed to create a rideshare business.

Starting a business has never been easy, especially in competitive industries. All you have to do is look at Uber and Lyft’s dominance to see just how tough of a nut this market is to crack. However, the industry is growing year-on-year, and as more people turn to ridesharing companies, the slice of the pie gets bigger.

There are small businesses popping up in cities all around the world with hopeful entrepreneurs trying to establish a foothold in the market. Starting your own rideshare company isn’t out of reach, you just need dedication and a solid and actionable business plan. If you’re thinking about having a crack at this exciting new industry, then these following steps should give you some guidance:

Step 1: Design your business idea

The idea is the root of any business. Brainstorm ideas from your competition and see where they are lacking. Conduct competitive analysis to see what they do well and what they don’t.

Unfortunately, you’re not going to have the first-mover advantage in the market, so you have to try and shake up the game by bringing something a little different to space if you are to be a success. What’s going to make your company stand out from the crowd? Why would a passenger choose your service over the next? The answer to these questions should help you orient yourself in the market.

Step 2: Get the essentials in place

Create a rideshare app with the necessary features. Hire a company or a specialist developer to create your app. This is one of the most important aspects of your company so you need to get this right. (More on this later.)

Build a website for marketing your service. In addition to an app, every business needs a website to promote and spread awareness about their brand. Your website must contain complete information about the application process for drivers and how the service works for riders. 

Get marketing. If you are not an expert in marketing and advertising, you will need a professional marketing team or agency to develop an effective strategy to increase awareness of your new project.

Step 3: Find drivers

For your new company to grow, you need drivers – it’s as simple as that. The ability to onboard competent and reliable drivers is the real make or break point for a rideshare company. If you have no drivers, your company has no ability to make a profit. Think of an enticing way to attract drivers and consider what their compensation scheme will be.

Step 4: Find riders

Now that you’ve got the drivers, you need passengers. Promote your application across as many platforms as you can and consider offering a welcome deal to new riders, such as free journeys or referral bonuses.

Step 5: Meet legal requirements

Obtain all the necessary permits and licenses required by your country, state, or region. Moreover, it’s important to run criminal background checks on drivers and employers to ensure passenger safety. Lastly, your company will need fleet-wide rideshare insurance that covers injury, property damage, or even death for every driver. 

How to make a rideshare app?

The development of a rideshare app is not the most complicated job for an app developer, but it still requires meticulous planning and careful execution. Here are some things to consider when making a ridesharing application:

Step 1: Investigate the competition. Visit other rideshare apps of your competitors and learn from them.

Step 2: Stand out. You need to add features that differentiate your app from your competitors. Incentivize the potential drivers and passengers to use it. You should pay attention to your target market and design an app with them in mind.

Step 3: Create a mockup using an MVP (minimum viable product). To start a rideshare business, you should focus on creating an MVP. Create your app with all necessary features such as, status changing, user profile, search, payment, chat, and so on. At this stage, you don’t have money to waste, so create a simple but functional app to see what’s necessary and what isn’t.

Step 4: Launch the app. After rigorous testing, and potentially offering a beta period, it’s time to launch the app. This should coincide with a full marketing campaign and an attempt to secure as many riders and drivers as possible.

Advantages and disadvantages of ridesharing 

Advantages of ridesharing

• Ridesharing companies help reduce CO2 emissions from the traffic by cutting down on the number of cars on the road and helps to ease congestion on the roads.
• 100% cashless transaction, which reduces the risk of crime.
• Drivers get to meet new people each day.
• Drivers can work as little or as much as they want, depending on how much demand there is.

Disadvantages of ridesharing

• Drivers sometimes have to deal with rude or inappropriate passengers and may have limited ability to decline their custom.
• Similarly, passengers may feel uncomfortable with certain drivers, which could create problems with concerns about safety.
• Drivers may be required to secure their own health insurance and rideshare insurance.
• Complications over liability and culpability could easily arise due to accidents.