After Initial Driver Mistrust, mytaxi’s New Marketplace Model Delivers 91% Job Acceptance Rate, Up From 85%

Introducing a radical new pricing model to an existing business is not for the faint-hearted. Just ask veteran German taxi app startup, mytaxi (founded back in 2009), which last January was preparing to shift into a new gear by switching from a fixed fee to marketplace model pricing in its home market of Germany.

Instead of mytaxi taking a set 79 euro cents fee per booked trip, drivers would be asked to choose the percentage revenue share per journey to give to mytaxi — via a slider that initially allowed them to select a proportion of  between 3 and 30 percent of the final fare to hand over to mytaxi.

The road to this brave new marketplace model did not run smooth, however. Quite the opposite; mytaxi co-founders Sven Kuelper and Nic Mewes found themselves spending “hours and hours” on the phone in the mytaxi call centre trying to reassure sceptical cab drivers who thought the new pricing was a dastardly trick to force them to pour a third of their revenue into the company coffers.

There was even a demonstration of around 150 drivers outside mytaxi’s Berlin office against the new pricing model.

The company responded to the driver mistrust by reducing the maximum revenue share in the new pricing model to 15% (instead of 30%). And, well, by spending a lot of time trying to reassure drivers about why they were shifting to a marketplace model and asking them to give it a go.

Ultimately a union-style agreement was struck among cabbies to universally select the lowest possible revenue share (3%) — which was at least an agreement that drivers would start testing the waters of the new order.

“The taxi drivers were demonstrating against the new pricing model. That was incredible,” Kuelper tells TechCrunch. ”And that was because the pricing model was new, it was something the taxi industry hasn’t experienced before, there were plenty of misunderstandings in the market because it was so new.

“But then at the end of the day most of our taxi drivers said ok we will give it a try — after convincing them via call centre, via thousands of emails. Nic my partner and I spent hours and hours in the call centre trying to explain this new pricing model and what is behind it.

“They were very very sceptical… They were afraid that they couldn’t get any tours if they don’t put 30% inside of the driver app.”

The result of the outreach to sceptical drivers was that most agreed to give the new system a try (some 17,000 of mytaxi’s 18,000 Germany drivers agree — so mytaxi did lose a portion of drivers as a result of the new pricing model).

“In Germany there’s no real alternative to mytaxi except the old traditional dispatch centres. We had 18,000 registered taxis in Germany, and at the end of the day it was 17,000 who said already I’ll give it a try with the new pricing… so we lost around 5% of our taxis,” says Kuelper.

Six weeks on from kicking off its experimental new pricing project, mytaxi has released the first tranche of data on how the model is working — and it shows a small increase in the average commission paid by drivers per journey: 87 euro cents, up from the 79 cent fixed fee of the old model.

This is despite around 50% of the journeys (in February) being assigned to drivers at a revenue share of below 5%. ”We have a price increase, but a pretty low price increase,” notes Kuelper.

But he adds that the new pricing model has been worth the turmoil for another reason: an increase in the job acceptance rate — up from 85% to 91%. 

“Our problem was is we had plenty of bookings — plenty of people who wanted to get a taxi — but we couldn’t assign all these tours because the price was fixed at 79 euro cents. And there were special hours during the day where the taxi driver said ‘no I’m not going to spend 79 cents on a tour because there are plenty of street hails’. And that was our problem — our problem was our success rate,” he says.

“That has shifted really tremendously. We have a huge impact on our total bookings because suddenly most of our bookings really take place — they work.”

mytaxi’s marketplace model is an alternative to the surge pricing system of taxi startups like Uber, which require the customer to accept a price hike if they want to get a cab during periods of high demand.

mytaxi’s system means the price for the customer does not change, but the revenue share for the driver varies based on factors such as whether it’s a weekend or a week day.

“When we have a lot of demand out there in the street, especially during the weekend then the cab price really decreases — then it’s always around between 3% and 5%

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With $500K In The Bank, Credible Launches A Kayak-Style Marketplace To Simplify Student Loan Refinancing

With outstanding student debt now over $1 trillion in the U.S., it’s clear that college grads are struggling mightily to make payments and refinance their debt. Meanwhile, thanks to decades of plummeting borrowing costs, millions upon millions of consumers have been able to refinance mortgages and begin paying down debt.

In some irrational alternate universe, one might expect that lenders would be lining up to take advantage of soaring student loan debt by offering more favorable terms than competitors. Nope, because that’s “crazy.” Even when students happen to find a decent job out of college, make payments on time and improve their credit scores, they remain locked into absurdly high fixed rates.

The majority of the big players in the private loan market appear more than happy to maintain the status quo, and wave off refinancing as a threat to the bottom line. Enter: Credible, a San Francisco-based startup launching today that aims to help graduates extricate themselves from high fixed rates, and make it easy to switch lenders and save on their loan payments.

Taking home the “Best 2.0 Company” Award at this week’s Launch Festival, Credible co-founder Stephen Dash said that, while racked with debt, the truth is that today many students could save a significant amount of money on their loan payments by switching lenders. Yet, the majority of them don’t because they don’t know how, or because the process of switching is so complicated and time-consuming.

So, Credible has developed a platform that makes it easy for students to find out whether or not they’re eligible for lower interest rates and could benefit from switching lenders. The startup’s loan comparison tools enable students to understand their loan profile relative to their peers and get an indication of what similar borrowers are paying for private loans.

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Euro Secondhand Marketplace Vinted Raises $27M To Take On The Salvation Army

The clothes may be cheap, but prices for tech companies launching mobile and web-based marketplaces to sell secondhand and consignment clothing keep going up. 

The latest company trying to get people to pop their tags virtually is Vinted, which raised $27 million in its second institutional financing – one of the largest rounds ever for a Baltic-based startup.

Fresh financing from Accel Partners and Insight Venture Partners for the Vilnius-based startup comes after Accel invested $6.6 million into the company just over a year ago to port it from a web-based application to a service primarily for mobile devices… and bring its service to the U.S.

Vinted launched in the U.S. in September 2013, after five years spent expanding in Europe, and will use its new cash hoard to develop its business here and add to its 110 employees both in San Francisco and in its Lithuanian headquarters.

“We started the company as a project five years ago that was really a hobby project,” said Vinted chief executive Justas Janauskas, in an interview. Initially it was designed to be a website where girls in Vilnius could swap or sell mid-priced clothes from brands like Zara and H&M. But with an early angel investment from Lithuanian serial entrepreneur Mantas Mikuckas, who joined as chief operating officer, the company professionalized and grew its European presence.

Vinted operates three different brands internationally:  manodrabuziai.lt in Lithuania; kleiderkreisel.de in Germany; and  votocvohoz.cz in the Czech Republic, but going forward will consolidate everything under the Vinted label.

In the U.S., Vinted is entering a very crowded market. Companies like Twice, which raised $18.5 million earlier this month from Andreessen Horowitz and a host of others; or Poshmark, which raised $12 million in a round led by Menlo Ventures; and thredUP, backed by Highland Capital Partners, Redpoint Ventures, and Trinity Ventures, are also competing in the category.

Unlike Twice, which operates as a virtual storefront for used clothes, housing them at its own facilities and shipping them to buyers, Vinted is more of a peer to peer marketplace and social network, according to its CEO.

Globally, online consignment and secondhand stores have raised at least $109.2 million in financing, according to data from CrunchBase.

So far, the company has 3 million members around the world and has had 14 million listings managed from offices in San Francisco, Paris, Munich, Warsaw, Prague, and Vilnius, on an app available on both iOS and Android.

The move to mobile proved to be a good one for the company, Janauskas said. “The customer retention is better; the user experience is way better than on the desktop. So naturally the company converted from desktop to mobile,” he said. 

For Accel, the company’s value was clear from the moment the partners first heard about the site, said Michiel Kotting, a partner working in Accel’s London office. “

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Messaging App Line Launches C2C Marketplace Line Mall In Japan

Messaging app Line began the limited rollout of its new C2C e-commerce platform Line Mall today. The app, which is now available for download in Japan’s Google Play store, is a sign that the service is doubling down on its efforts to increase engagement among users as it competes with WeChat, WhatsApp and other popular messaging apps. Line Mall will officially launch next spring with an iPhone app and more features.

Line Mall lets vendors sell products without listing fees, though it does take a 10% cut of the final price for items that sell. Each seller also receives one point (worth 1 yen or about 1 cent USD) that can be redeemed for discounts after each successful transaction. Sellers and buyers authenticate their accounts and connect payment info with their Line account, but they can also set up a separate Line Mall ID.

Line’s other e-commerce ventures have included flash sales in Thailand via official brand accounts on its messaging app, which monetizes through sticker sales, games and branded merchandise.

The app, which was launched in 2011 by Japan’s Naver, announced in November that it had hit 300 million registered users worldwide and is targeting a 500 million registered user milestone next year. It is important to note, however, that those numbers reflect people who have signed up for the service, not monthly active users.

Despite its push to expand globally (key markets include East Asia and Spanish-speaking regions like Spain, Mexico and Latin America), Line has so far only reported MAU for Japan, so it’s hard to tell how engaged users are in other countries.

Key rivals WhatsApp and WeChat, on the other hand, both report monthly active user counts–WhatsApp has more than 350 million MAUs, while WeChat has about 272 million.

As competition for international users heats up among messaging apps, launching other ventures like Line Mall can help increase user engagement. But Line faces several C2C mobile commerce rivals, including Carousell, a Singapore-based app that Japanese e-commerce giant Rakuten recently invested in, and Yahoo! Japan auctions, which has its own Android and iOS apps.

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