Driving Towards Profitability: Insights into the Cabify Business Model
In the rapidly evolving world of transportation, innovative companies are revolutionizing how people move from point A to B. Among these disruptors, Cabify has emerged as a prominent player, transforming the traditional concept of transportation services. With its unique business model, Cabify has gained recognition for its commitment to providing reliable, convenient, and sustainable mobility solutions.
This blog post delves into the intriguing Cabify business model, examining the fundamental principles and strategies that have propelled its success in the competitive ride-hailing industry. By understanding how Cabify operates and differentiates itself from its competitors, we gain valuable insights into its contributions to the transportation ecosystem.
Understanding the Cabify business model can also help you launch a similar business and gain popularity quickly. Investing in the Cabify clone app with all its features and models can provide you with a great business opportunity. A platform similar to Cabify acts as a mediator between drivers and riders. Read the blog to dive deep into the taxi-hailing business model.
What is Cabify?
Founded in 2011, Cabify is a multi-mobility platform that provides multiple alternatives to reduce urban travel in private cars. Cabify provides on-demand transportation services through a mobile app, connecting passengers with professional drivers in various cities worldwide.
Like other ride-hailing services, Cabify offers a convenient and efficient way for users to book rides and travel from one location to another. Passengers can request rides through the Cabify mobile app, specifying their pickup and drop-off locations.
The app provides information about the driver, estimated time of arrival, and fare details. Users can choose between different vehicle categories based on their preferences and needs, from standard cars to executive vehicles.
Cabify provides its service in Latin America and Spain. The ride-hailing platform offers two types of services:
- For businesses
- Another for individuals.
Juan de Antonio founded Cabify, Spain’s first-ever Unicorn company. The transportation company focuses on safety, quality, and customer experience.
The company aims to provide reliable and comfortable rides by partnering with professional drivers who undergo rigorous screening and training processes. Cabify also prioritizes using modern, well-maintained vehicles to ensure a high-quality transportation experience.
Success Timeline of Cabify
Cabify has expanded its operations to numerous cities across Europe, Latin America, and other regions, making it a global player in the ride-hailing industry. By combining technology, convenience, safety, and sustainability, Cabify has become known to individuals and businesses seeking reliable transportation solutions. Have a quick look over Cabify’s success timeline right below:
Founder: Juan de Antonio
Headquarters: Madrid, Spain
Areas served: Latin America & Spain
Number of employees: 1200 (2023)
In 2012, Cabify had almost 20,000 users and completed 3,000 rides in Madrid alone. Cabify has more than 1.2 million drivers and 42 million registered users today. The ride-hailing company employs around 1,000 people in Latin America and Spain.
The company launched Cabify Lite in 2013. To improve passengers’ and drivers’ safety, Cabify partnered with Waze in 2016. In the same year, the company also launched its services in Portugal.
The company provides its service in over 40 cities, including Alicante, Madrid, A Coruña, Santander, Barcelona, Valencia, Zaragoza, Málaga, Murcia, and Seville. Cabify launched Cabify Logistics in 2022, which owns electric vans dedicated to parcel service.
Cabify Funding and Investment History
The company raised around $4 million in Series Seed investment rounds from Belgian fund Emerge, a series of Latin American investors, Black Vine, and angel investors sourced through AngelList (Winklevoss twins) in 2012. The ride-hailing company, Cabify offers lots of services, including:
Cabify Express: Immediate delivery service through moto-taxis.
Cabify Taxi: Local taxi cab services (Peru).
Cabify City: Independent driver’s service (Spain).
Cabify Bike: A service enabling users to ride their bikes (Chile).
Cabify Cash: Services that allow users to pay cash using credit cards (Peru).
In 2014 funding round led by Seaya Ventures, helped Cabify to generate 8 million. The company’s revenue increased to $40m from $10m in the same year. In 2016, Rakuten invested $92 million in Cabify. After the financing, the company was valued at $320 million.
In 2018, the ride-hailing business raised an additional $160 million. The Spanish company raised $110 million in financing to accelerate its growth in Spain as well as Latin America. In 2022, Cabify received 40 million EUR in Spain from the European Investment Bank to purchase a fleet of electric vehicles.
The business volume jumped by 32%, helping the company to increase its market share in 25 cities in Spain and Latin America with populations of 200,000. Cabify recently said it would invest $300 million to strengthen its presence in Latin America by 2024.
Cabify Business Model: How the Ride-hailing Company Works?
It operates under a business model commonly known as a ride-hailing or transportation network model. The Cabify business model has various factors that make it robust. Let’s check the critical components of the transportation company’s business model:
It refers to the customer spectrum of a business catering to an area. There are lots of customers who get their needs satisfied with Cabify. The customer segment of Cabify is as under:
- Drivers as Collaborators
The above-listed customers get their transportation needs satisfied with Cabify. This helps the ride-hailing brand to expand its business and build credibility in the market.
- Cabify believes in maintaining the best relationship with its targeted customers to build its loyal customer base.
- The company helps riders to book their premium ride-hailing services to give optimal digital experience.
- Customers get various choice points.
- The company gets security and transparency when they book the company’s service.
- Verified drivers will provide customers with the best services in the market.
The company constantly looks at a few concerns, which helps Cabify maintain a positive relationship with its customers.
How Cabify Works: Step-by-step Process
Now you have insight into Cabify’s business model. It combines technology, safety, sustainability, and partnerships to provide convenient, reliable, and efficient transportation services while ensuring a sustainable and scalable operation. The ride-hailing company operates through a straightforward process involving passengers and drivers. Here’s how Cabify works:
Registration and Verification
Passengers must download the Cabify mobile app from their respective app stores and create an account. During registration, users typically provide their personal information, including their name, contact details, and payment method. This information is securely stored to facilitate future bookings.
Booking a Ride
Once registered, passengers can open the Cabify app and enter their desired pickup and drop-off locations. The app utilizes GPS technology to determine the user’s location, or they can manually input the addresses. Cabify offers various vehicle categories, allowing passengers to select the option that suits their needs as well as preferences.
After confirming the ride details, Cabify’s system matches the passenger with an available driver nearby. The driver’s profile and vehicle details, such as make, model, and license plate number, are displayed in the app. Passengers can track the driver’s location and estimated arrival time in real-time.
The passenger can board the vehicle once the driver arrives at the pickup location. Cabify aims to provide a comfortable and safe journey with drivers who have undergone background checks and training. Throughout the ride, passengers can use the app to communicate with the driver or update their destination.
Payment and Ratings
Upon reaching the destination, the Cabify app automatically calculates the fare based on the traveled distance and duration. The fare is typically charged directly to the passenger’s registered payment method, eliminating the need for cash transactions.
Passengers can rate the driver and provide feedback on their experience, helping Cabify maintain service quality and improve customer satisfaction.
Driver and Vehicle Management
Cabify also provides a platform for drivers to manage their availability and accept ride requests. Drivers undergo a registration and verification process, including submitting necessary documents and meeting specific criteria.
The Cabify app provides drivers with information about requested rides, navigation assistance, and tools for efficient trip management.
Cabify’s user-friendly interface allows passengers to book rides conveniently while ensuring a reliable and efficient transportation experience.
Cabify Revenue Model: How Cabify Makes Money?
The Cabify revenue model is an essential part of your research. Knowing how Cabify makes money helps you to understand how transportation generates profit.
Cabify is the right platform for drivers looking to make good profits. The company charges almost 20% commission on each ride. The commission is considered one of the crucial parts of the company’s revenue. There is no fixed investment that drivers need to make; they have to pay a commission.
Cabify implements surge pricing during periods of high demand. When demand exceeds the available supply of drivers, Cabify may increase the fares temporarily to incentivize more drivers to accept ride requests.
Surge pricing helps balance supply and demand while ensuring the availability of rides during peak times. The increased fares during surge pricing contribute to Cabify’s revenue.
In addition to standard ride options, Cabify may offer premium services to cater to specific customer segments. These premium services often include luxury or executive vehicle categories, providing passengers with higher comfort and amenities.
Premium services typically come with higher fares, allowing Cabify to generate additional revenue from customers willing to pay for a more upscale transportation experience.
Advertising and Partnerships
Cabify may explore advertising opportunities and partnerships to generate additional revenue. By partnering with other businesses or brands, Cabify can collaborate on marketing campaigns or offer special promotions to its user base.
Advertising within the Cabify app or leveraging customer data for targeted marketing efforts can also be avenues for revenue generation.
Corporate Accounts and Partnerships
Cabify offers corporate accounts and business solutions tailored to the needs of companies and organizations. These services provide businesses with centralized billing, reporting, and expense management features.
Cabify may charge a fee or a percentage of the total spend for these corporate accounts, generating revenue from long-term business relationships and partnerships.
Launch Your App Like Cabify Today!
We hope this blog might help you to have insight into the Cabify business model, how it works, and generate money. Knowing an online taxi booking platform working can help you understand how it promotes customer loyalty by satisfying their requirements. If you are looking to launch your taxi-hailing or ride-hailing business in Spain and Latin America, White Label Fox can help you.
Our developers have years of experience and expertise in developing a platform like Cabify that helps you deliver a digital experience. We include all the models and functionality that help you manage everything from one place. Contact us to specify your requirements and satisfy your taxi platform development requirements today.