The Kenyan capital Nairobi is among the 10 most congested cities in the world, with the average commute time standing at 57 minutes – mostly as a result of heavy personal vehicle use and slow public transport services.
Approximately 8,000 new vehicles appear on the roads each month, an unsustainable volume but growth that is only encouraged by the fact Nairobi lacks a quality public transport system, with “matatus” (minibus taxis) perceived as unsafe, unreliable, and uncomfortable.
As with other problems, local tech startups believe they have the answers. One of those is Data Integrated, which provides digital technology-based solutions in the informal public transport space and last year secured funding from Toyota Tsusho.
“Our solutions help the public transport organisation provide route optimisation, scheduling, information on commute planning such as travel times, online booking portal and digital interoperable payment platform for buses, motorcycles and ferries,” chief executive officer (CEO) Mary Mwangi told Disrupt Africa.
Providing tech solutions to the informal transport space in Nairobi is an extremely new concept.
“When we first started working in the informal transport sector over 90 per cent of the daily processes, logistics, payments and records were manually managed, mostly on paper,” Mwangi said.
“Up to now there are many systems in the transport sector that are very manual processes. There are over 80 per cent of businesses in transport that are yet to adopt technology in their operations.”
These businesses are missing an opportunity, as all the evidence suggests that applying tech within the transport sector leads to improvements in daily operations, services and general business practices. Much of this results from the increased and improved use of data.
“In logistics, historical data is used as evidence in case of accidents. In accounting, it helps with transparency in collection of revenue, reducing cash leakages,” Mwangi said. “Travel information and trip management enables efficiency for the passengers, as well as security and enhanced safety when using public transport.”
Another Kenyan startup in the public transport space is QuickBus.Launched in 2019, the startup aggregates long distance bus tickets in a marketplace, making it easier for users to compare prices and book journeys, and helping bus companies run their businesses more efficiently.
Managing director Humphrey Wrey said QuickBus, which closed a US$1 million seed round at the end of 2019, modernised internal systems in bus companies and made it easier for customers to book through WhatsApp, USSD and web platforms alongside an agent network.
“Largely the long distance bus space has not adopted any significant customer facing technology beyond payment methods and SMS tickets. This is the same the world over, aggregation and onboard Wi-Fi are generally the most advanced features of modern long distance bus transport,” Wrey said.
“Tech allows companies to reduce fraud, customers to book more easily, having more choice both in terms of service and price, and cities can benefit from a more organised transport sector as long distance bus parks within cities can put pressure on the traffic systems in an urban area.”
Kenya is not the only African country, nor Nairobi the only African city, plagued by public transport challenges. South Africa has similar issues, and as a result has emerged as a leader when it comes to transport technologies. GoMetro and WhereIsMyTransport are innovative continental leaders when it comes to using data to smooth journeys.
“Digitalisation of mobility information has progressed at different paces. With networks made up of different operators – from independently run informal services to government-run systems – accurate, reliable and comprehensive data from every operator in a city has typically not been available,” Devin de Vries, CEO of WhereIsMyTransport, said.
“Where it has been, such as timetable information for buses and metros, it is often incomplete and out of date. For informal services, which run flexible routes and timetables, the challenge of accurately digitalising network information is one that no firm before WhereIsMyTransport has met.”
Formed in 2016, WhereIsMyTransport is a big data platform for sustainable mobility in emerging markets, which connects and collects data and integrates this information on its open data platform.
Its products are used by cities to coordinate and monitor services, operators to integrate their systems, and passengers, who access the platform through apps and endpoints connected to the WhereIsMyTransport platform.
The company raised a US$7.5 million funding round last March from investors including Google and Toyota Tsusho for further global expansion. De Vries said the mobility information provided by WhereIsMyTransport, which launched operations in Africa but has since expanded to India, Southeast Asia and Latin America, can be transformative.
“In the Majority World, it is common for commuters to rely on word of mouth or lived experience when choosing routes. This can result in viable options remaining unknown and, most critically, difficulty in planning alternatives when journeys don’t go to plan,” he said.
“Comprehensive network information is the foundation of any response to these challenges. For organisations working in these regions, understanding mobility is impossible without accurate and reliable data. Everything from urban planning projects to goods distribution benefits from understanding mobility ground truth.”
Sustainable transport solutions
Clearly, then, the likes of Data Integrated, QuickBus and WhereIsMyTransport have developed technologies that can have real impact on African cities and the people living in them. But can these innovative technologies establish themselves as sustainable businesses, especially when often their key clients are temperamental beasts indeed – African governments and city authorities.
Mwangi said Data Integrated pursues sustainability by engaging all stakeholders within the public transport ecosystem, be they government, transport institutions, bus owners, drivers, or commuters.
“We monetise our product in several ways through software as a service, transaction fees as a percentage, and markup on device sales,” she said.
The ability to potentially turn a profit has attracted investors of the yolk of Toyota Tsusho, but Mwangi admits the ability to secure investment from partners like this is a relatively new thing for companies in this space.
“At first we had a real challenge raising funds, mainly because of the knowledge available within the informal public transport industry, and it takes time to get investors who are comfortable with the public transport area,” she said. “We since got Mobility 54 as a strategic investor and we are seeing more investors taking a second look at what we are doing now.”
She also admits that working with the government can sometimes be very difficult, especially when the company has developed a strategic plan and a new policy comes along that makes various aspects of that strategy unusable.
“You have to be flexible and work within the government regulation, which slows us down, but we have learned to plan our product schedule,” Mwangi said.
“The government also encourages digital systems adoption and this gives us a boost due to these regulations. All in all the impact of the government is positive. The bigger challenge is the lack of infrastructure support for the digital solutions that we need to provide easier adoption for the cities and general public transport as a whole.”
De Vries said governments were incentivised to work with tech startups due to their ability to inform better decision-making.
“It’s nearly impossible to solve a problem you can’t see. Government partners benefit from better data, helping inform decisions and create successful and sustainable initiatives,” he said.
“Operational understanding of informal transport, which up to 80 per cent of passengers rely on, is crucial.”
However, as informal networks are not owned, operated, or regulated by city authorities, this can mean government interests do not always match citizen interests.
“Many innovative solutions in these markets are coming from small, fast startups, but administrations are not always set up to work with them. We always aim to work inclusively, and collaboration with government partners is important for impact, but it is not always the shortest route to deliver change on the ground,” de Vries said.
Yet when such partnerships can be established, their effect on a startup’s growth and a country or city’s public transport systems can be huge, said Wrey.
“It is challenging but rewarding when it pays off,” he said. And for an increasing number of VC-backed companies in markets such as Kenya, South Africa and elsewhere, that pay-off seems to be arriving more quickly.