New York on the Move: The Future of Mobility
On May 21st the BMW iVentures team invited a selected group of New York investors, entrepreneurs and tech professionals to their 7th mobility meetup. Good timing for the gathering: With Internet Week taking center stage in New York, the bike share program finally commencing on Memorial Day weekend, and Tumblr, the New York based blogging company, being sold to Yahoo for a record sum of $1.1 billion, the spotlight for new ventures is on New York.BMW might still be more famous for its cars than for its tech investments at this point, but with its move into office space at 95 Morton Street in January of 2012 to set up an incubator, it has gained entrance to the digital scene here in New York. The $100 million iVentures Fund is focused on startups that will create an impact in the area of mobility services in urban areas either by improving personal mobility via intermodal travel, smart parking, recommendations, communication, or even in bicycling. Why has BMW moved into this space? For one, it has become obvious that the younger generation is less likely to spend on a car purchase than previously; in addition it has become obvious that the sharing of resources and data can improve urban living and transportation overall.BMW iVentures New York hosted Wednesday’s meetup in its spacious loft on the seventh floor of a prewar building with a beautiful views overlooking the Hudson river. A perfect sunset on this first summer evening helped to set the tone of the event and almost 200 investors, tech professionals, and entrepreneurs attended.Four companies were invited to present and were judged by a jury consisting of Lawrence Lenihan, Founder and Managing Director of Firstmark Ventures, Steve Schlafman, Principal at Lerer Ventures, and Ulrich Quay, Managing Director at BMW iVentures. It was exciting to watch each company present their ideas about enhancing our mobility in the future, as clearly, there is room for improvement, especially here in New York where congestions and infrastructural problems are visible every day.Bandwagon
This company promised to increase the efficiency of taxis by selling excess capacity in each vehicle. Their core selling point: an airport "batch platform" currently in use at La Guardia airport for rides going into the city. The company promised to improve the $9 billion transportation market and – even more importantly - to speed up the lines at airports by giving customers a jump ahead of the line when they decide to share a ride. Bandwagon already raised $4 million in their first funding round and will be looking to expand the service into other regions and areas in the city. New Yorkers and visitors alike will surely love to see a similar service at JFK and Newark. Bandwagon is already in service and the company is screening the market for further opportunities.
Via also attempts to enter the ride share market with a different concept, which reminded some attendants of mass transportation solutions in Asia: Via is looking to employ a fleet of minibuses throughout the city on which customers will be able to book a point-to-point transit in the city for only $5 per trip. The Israeli / US startup has teamed up with Mercedes and is in a private beta. This hybrid bus / taxi concept still needs to validate its promise, but with increasing prices for cabs and buses that are still not covering the entire city, we’ll be watching out for dark minibuses to hit our roads in the coming month.
The third company pitching to the iVentures VCs presented a different idea centered around a connected car platform. With a $10 device, Dash promises to turn any type of car into a smart car, which would make driving safer, smarter and more social. From danger alerts (speeding, obstacles) to driving comparisons, to roadside assistance, Dash promises the user value through assembled data – calling its application the “ultimate data machine.” Dash already develops custom apps for Ford and GM and is in talks with the insurance industry – a playing field still largely untapped.
The final presentation, Sidecar had the disadvantage that their service is momentarily on hold in New York, but is operating in other metropolitan areas such as Philadelphia, Boston and D.C. Sidecar made the plausible argument, that most of today’s privately owned vehicles are vastly underused (only used on roads 5% of the time) while the average cost of maintaining and driving a car was a staggering $1000 per month. This means that on average 17.6% of the average yearly spending is done on cars in American households. Leaning on the shared economy principle, participants of Sidecar are able to utilize their own cars better by offering rides to others while the platform suggests a donation to the driver.
While we can see useful cases for all four presentations, the jury thoroughly questioned the economics behind each business model. Bandwagon claimed to increase the value of each cab ride, therefore making it easier to implement, while Sidecar argued that most car owners would welcome the ability to lighten the burden of maintaining a car. Still, the economics of each model need to be proven, and legal restraints as well as competitors like Uber already in the New York market will make each effort a challenge.New York International applauds all efforts that promise a better urban future and we are looking forward to the next BMW i Venture event – car presentations included!