Bike taxi service is becoming increasingly popular in India despite being banned in several states and cities. Bike taxi aggregator Rapido and other ride-hailing platforms have been facing severe legal troubles for over a year now
Karnataka had asked platforms like Rapido to stop three-wheeler services, accusing them of overcharging and harassing customers. In Maharashtra, bike-taxi services are banned. Even Delhi banned bike-taxis for violating the Motor Vehicles Act
Rapido continues to operate in states and cities where they are banned. According to industry experts, the battle isn’t just about Rapido as the whole bike-taxi industry has been impacted since the regulations vary by city and state
“Rapido has gained significant market share over Ola and Uber by running their operations when others shut down to comply with government regulations,” a former senior executive at Uber told Business Today magazine
Start-ups often leverage regulatory ambiguity to disrupt traditional industries. First, they establish themselves as market disruptors by offering convenience and better pricing; then they lobby for regulatory changes to legitimise their operations. Rapido has been driving such a disruption for bike-taxis in India
"The rules change in every state... But that doesn’t mean we have been involved in illegal activity. We are generating lakhs of jobs by virtue of Captains already owning a bike," Aravind Sanka, Co-founder of Rapido told BT Magazine
As per unverified estimates, Rapido currently enjoys a 65% market share in India’s fledgling bike-taxi industry. It provides 1 million bike rides per day in 120 cities across India. Rapido's revenue has grown from Rs 301 crore in FY20 to Rs 597 crore in FY22
Since its launch in 2015, Rapido has had a steady but frugal journey. It chose not to expand beyond Bengaluru in the first three years of its existence. Its first large round of Rs 52 crore in Series A funding came in its fourth year. This frugal mindset has helped it survive even as dozens of peers have wound up between 2015 and 2018
Outside bike-taxi services, Rapido has partnered with Swiggy, Amazon and JioMart to provide its captains with ample work throughout the day. Rapido is working to transition its fleet from traditional ICE vehicles to electric two-wheelers
Rapido is the only one with tight integration with food and e-commerce players. “It’s a superb business. There is no fixed cost, no customer acquisition spends. It is their biggest competitor moat right now," a former bike-taxi founder told BT
While affordability and convenience are a plus for Rapido, safety remains a deep concern. Two-wheelers are seen as less safe than their three- and four-wheeler counterparts. Then comes the hesitation among women in riding pillion with a stranger due to its unfamiliarity and safety concerns
According to Ujjwal Chaudhry, Partner, RedSeer Management Consulting, The bike-taxi industry was quite small till CY19, and de-grew in 2020, but since last year, growth has been phenomenal. Compared to CY20, bike-taxi rides in CY22 have grown 2.5 to 3 times
Rapido’s dominance in the bike-taxi space is undeniable, with it being the backbone of its entire business. This is precisely why they can’t afford to halt operations. However, as the demand for convenient and affordable transportation continues to rise, the bike-taxi market is ripe for the picking