Carpool startup Ride launches, with a different plan in mind

The latest entrant in the ride-hailing industry is hoping to make waves by focusing more on car-sharing with commuters rather than on-demand rides.

Dara Kerr Former senior reporter
Dara Kerr was a senior reporter for CNET covering the on-demand economy and tech culture. She grew up in Colorado, went to school in New York City and can never remember how to pronounce gif.
Dara Kerr
3 min read

Ride is a new car-hailing app that caters to carpooling commuters. Ride

Is there room for another ride-hailing startup?

That's what a new smartphone app called Ride is hoping to find out. It's muscling into the increasingly crowded field of ride-hailing startups, dominated by Uber and Lyft, by focusing on carpooling, rather than replacing the taxi.

Ride, which launched its app across the US on Tuesday, touts its service as being able to help take cars off the road, ease congestion and "reinvent the commute" for riders. The way it will do that is by partnering with businesses to use its app that matches employees traveling along similar routes. The employees then drive each other and pay through the app to help defray gas and other commute costs.

Uber and Lyft, by contrast, let passengers use a smartphone app to hail a town-car service or a personal driver using their own car.

"We really believe Ride fits a need that nobody was solving," Ride CEO Ann Fandozzi said. "There's a lot of ride-hailing, which is an easy way to get a cab or a black town car. But we're for people with much longer commutes."

New ride-hailing services are popping up on what seems like a weekly basis. All of them claim to be changing how people move around cities. Since Uber launched in 2009, direct rivals have sprouted up, including Lyft and Sidecar, as well as taxi-hailing apps, like Flywheel and AsterRide. There are also shuttle buses, like Leap, Chariot and Via, which pick up passengers along a set route. All of these services believe there's money to be made by offering alternatives to existing taxis and public transportation.

Ride isn't the only company focused on business partnerships. Uber also announced Tuesday that it's seeing "growing popularity" among its business travelers. The ride-hailing service has a feature called Uber for Business that collaborates with companies to provide rides for employees. Uber said "hundreds" of new companies are joining its service each week.

But, unlike Ride, Uber for Business does not cater to carpoolers. So is Ride unique enough to place its stake in this fiercely competitive ride-hailing world?

"Ride's target market is different from that of Uber and Lyft," said Parks Associate research analyst Tejas Mehta. "If Ride can get a few large employers on board to help build a critical mass of users, it stands a better chance of carving a niche for itself in a market that is less crowded than on-demand ride sharing."

Still, Mehta believes not all people will easily switch from driving themselves to work to carpooling. "Carpooling requires lifestyle adjustments on the part of commuters which makes it tougher for apps like Ride to build a user base compared to on-demand ride-sharing apps," he said.

More than 100 million people in the US commute to work alone in their car each year, according to Ride, and one third of those people drive for 30 minutes or more. Fandozzi said in many areas, public transportation isn't available and if people chose to rely on an Uber, Lyft or taxi, they'd "break the bank." Fandozzi said if people opt to use Ride, they could ultimately save money on commute costs.

Ride is headed by people familiar with the car-hailing world. Its chief technology officer, Oscar Salazar, was Uber's founding CTO and Fandozzi was the former global executive director of carmaker DaimlerChrysler for six years.

Besides focusing on carpooling, Ride is different from Uber and Lyft in other ways -- most notably, drivers aren't paid. The service is designed to encourage co-workers to drive one another, so passengers pay the driver for the cost of the commute but not for being a chauffeur. The app determines how much each ride costs, depending on gas prices and the distance of the trip.

Ride launched its service with Stanford University last year and as of Tuesday is offering its app to all US businesses. Fandozzi declined to say which businesses it's working with or what specific cities it's operating in.