In May 2021, Taximandu won the Startup World Cup Nepal Regional 2021 competition organised by Startup Hub Nepal and World Trade Group. The top 10 startups were selected in the Nepal edition of the Startup World Cup which Taximandu eventually won.
The Startup World Cup is an international competition between budding companies with innovative and disruptive business ideas from around the world. Startups from 60 countries have participated in this year’s event and the finale will see the winner picking up a prize of USD 1 million.
“It is the first time that a Nepali startup has participated in such a large platform and it is a great opportunity for us. It can help to demonstrate that startups in Nepal are also very competitive,” says Arjun KC, founder of Taximandu. He is excited that his team will visit California’s Silicon Valley in November to compete in the finals of the Startup World Cup.
Taximandu is an on-demand transport service provider established in 2019, just a few months before the lockdown in March 2020. It is an online taxi booking app where customers can book a taxi within few minutes using its mobile app. While other ride sharing apps are more focused on two-wheelers, Taximandu is solely a taxi service provider.
KC claims that his company is reliable regarding the safety and security of its customers. “If any goods are left behind in the taxis, then customers can track the vehicles and get their goods back,” he says.
Prior to the establishment of Taximandu, KC had worked with different tech companies and participated in different vocational training programmes related to technology. After working for around eight years with a company in Hong Kong, he returned to Nepal in 2016 thinking of doing something on his own. At first, he started a media company, which he found to be more of a social service than a business. Then, he decided to work on a ride sharing service.
The idea of starting a taxi ride sharing service was inspired by his experience of such services during his stay abroad. “While using ride hailing services, I had always thought if a similar thing could be started in Nepal too,” he shares.
KC believes that public transportation system in Nepal as still very much underdeveloped and many things still need to be done in transport management, including the safety and security of passengers. “I was always inspired by ride sharing services,” he adds. Hence in 2019, he started the company with an investment of Rs 30 million. According to KC, he took a collateral-based loan of Rs 10 million from Nabil bank and added investment from his personal savings and also borrowed money from friends.
In the first phase, he had thought to start the company with Rs 50 million but due to the covid-19 pandemic, they could not operate as planned. Prior to the establishment of Taximandu, he hired 10 interns and did market research.
Challenges and Opportunities
After months of research and field study, his team found that were around 12,000 taxies operating in the Kathmandu valley which showed that opportunity was there.
Although there was huge scope for the business, he came across various challenges. Interacting with taxi drivers was the main challenge. “Most of the taxi drivers were not tech-friendly and it still is a challenge for us,” he says. On top of that, the common mindset of customers regarding the behaviour of the taxi drivers was also another challenge. “Furthermore, access to the internet was also another problem,” he mentions.
KC informs that in order to overcome the challenge, they started training taxi drivers and educating them on using the app and digital maps. They also trained the taxi drivers and taught them about payment gateways and how to use them.
Four months after starting the service, Taximandu was forced to face the lockdown imposed by the government to curb Covid-19 infections and they had to close their operation. “In the first three months of our operation, we felt that we could achieve our goals within three years which we had earlier set for five years. But the pandemic affected our business badly,” says KC. After the lockdown was lifted after four months, they continued to provide services to customers.
The company also had to cut the number of employees. They used to have around 35 staff before the lockdown and this number has fallen to 15.
KC believes that along with challenges come opportunities. Although booking taxi rides via a mobile app is still in its infancy in Nepal, he says that the number of app users is increasing.
However, survival is the biggest question startups like Taximandu are facing right now. “The government needs to support us in these trying times. Though there are policies and programmes for startups, lack of clarity creates bottlenecks in terms of implementation,” says KC, adding, “Also the government is still not clear about the definition of a startup and categorising startups and other businesses.” According to him, this ambiguity is one of the reasons why startups take bank loans.
At the moment, around 3,000 taxis are associated with Taximandu and more than 40,000 people use their service. KC claims that these numbers are increasing, and they have been receiving encouraging feedback from customers.
Before the pandemic, Taximandu was only a ride sharing service. But after the lockdown, the company has been upgraded to a multiservice platform. They have started logistics services which includes home delivery of groceries, medicines and restaurant food. “We will also provide handyman services and doctor services,” informs KC. According to him, the platform has already been developed and they are waiting for aggregator partners.
KC says that some individual investors have shown their interest in the company. “Similarly, some investment companies are also in talks with us to invest in the company,” shares KC.
For now, Taximandu has focused its efforts in preparing for the Startup World Cup. “We want to bring home the glory and this is one of the top priorities for us at the moment,” shares KC. Similarly, the company is planning to expand its service beyond the Kathmandu valley to major cities like Birtamode, Biratnagar, Pokhara, Chitwan and Butwal.
According to KC, the company is also looking to operate in some developing Asian and African countries. “We are doing feasibility studies to expand our services in 10 countries including Indonesia, Malaysia, and the Philippines and are also communicating with prospective partners in Australia to operate there,” he says.