The emergence, growth, and then sudden fall of motorcycle ride-hailing start-up, ORide which specifically targeted bike riders in Nigeria’s commercial capital is a phenomenon that will continue to bewilder many for years to come.
It is an instructive scenario in the context of entrepreneurship and tech startup which holds a lot of lessons for would-be tech entrepreneurs.
In this piece, Exclusive Africa’s Editor at Large, Wale Ameen takes a cursory look down the lane at the glorious emergence of ORide and chronicles the rise and sharp descent into oblivion all within the space of one year of the ride-hailing brand.
It was in May 2019 that Lagosians woke up to the announcement of the launch of a new ride-hailing service in Lagos, Nigeria’s commercial capital. The media frenzy that greeted the launch of the brand was in itself exciting. Towards the end of June, lemon green helmets with fully kitted rider ‘suits’ could be spotted along major highways in Nigeria’s commercial capital.
ORide entered the motorcycle e-hailing business ready to give already established brands like Gokada and Max.ng a run for their money with a heavy war chest of internationally sourced funding backed by venture capitalists.
The launch in Lagos was strategic, any business that sought an entrance into the large and profitable market in Nigeria had to launch from Lagos, doing otherwise is a no brainer.
Before the arrival of the motorcycle ride-hailing brands, the likes of Uber had reigned supreme along with Taxify (now bolt) in the ride-hailing business.
But OPay’s ORide was coming with a different strategy, it’s focus was in the largely untapped motorcycle business where Gokada and Max.ng operated and were yet to fully meet the demands on the ground.
ORide came and it came in with a big bang.
The motorcycle ride-hailing brand, a sister vertical within the Opay group of ‘small’ startups which included OFood, OBus, OKash, and OLeads were all hosted in its super app.
Unlike Gokada or Max, it had a lot more cash to burn in its bid to claim a huge chunk of the market. Gokada and MAX felt the brunt of ORIde’s aggressive customer acquisition.
These riders were offered between N35,000 and N36,000 to join ORide. The incentive was reported to have triggered a migration of riders from Gokada to ORide, a move that assisted it in meeting its onboarding target during its promotional period between June and July 2019.
Gokada and MAX may have both been hit by ORide’s strategy but Gokada it was of the lot that was the most affected. Not only were its bikers affected, but the startup’s leadership was also not spared.
ORide was reported to have poached a good number of its top executives and in the end, Gokada’s Co-founder and three others jumped ship.
Awolowo Moses was the Co-founder/COO of Gokada but ended up as the Director of Business Operations at ORide, Ebunoluwa Shipe served as the Head of Driver Support/Experience at Gokada but she moved in as Senior Operations Manager at OPay, Awe Oluwakayode who was Gokada’s Drivers Acquisition and Road Operations Officer became Senior Operations Manager at OPay and Akinwale Afolabi, it’s Head of Marketing joined OPay as Senior Manager, Growth and Marketing.
Gokada would later announce a break of two weeks, to re-strategize. A period many observers opine was a way to go and take a breather from the intense and bullish competition.
MAX also went ahead to launch MAX Keke, a tricycle alternative in a bid to brace up for the competition from ORide’s OTrike.
It was an interesting period to be alive to see the brute methods deployed by ORide/OPay to enter into the market big. And it sure got what it wanted.
And then trouble started…
In August 2019 just a few months into the launch of ORide, the Lagos State government moved to impose a new regulation of a yearly licensing fee on the e-hailing startups. Reports had it that the government considered levying a sum of N25million as an annual licensing fee that is $70,000 (N25 million) per 1,000 bikes every year and another $83 (N30,000) per bike after the first 1,000 set.
This was shortly after bikers began getting harassed by officials of the state’s NURTW who also didn’t want to be left out from the seeming largesse the bike-hailing startups seemed to be rolling in.
At various locations across the state, the NURTW officials were demanding that bikers pay as much as N500 for a N100 ticket.
This went on for a while until officials of the ride-hailing platform were able to find a common ground with the leadership of the NURTW led by popular MC Oluomo.
In a landmark event on 25th November, bike-hailing companies finally reached an agreement with the National Union of Road Transport Employers’ Association of Nigeria (NURTW) and the Road Transport Employers’ Association of Nigeria (RTEAN) to pay N500 daily per rider to avoid harassments.
With the agreement, the Lagos State NURTW leadership would be getting about ₦182.5 million ($501,935) for 1,000 bikers if each biker pays N182,500 ($501.93) to operate in the state for 365 days.
While this was going on, the Lagos State Government simply looked on, holding its card close to its chest and bidding its time. As it turned out, the Lagos State government led by Governor Sanwo-Olu must have been irked at the shenanigans of the road Unions abrogating to themselves powers they didn’t own.
By January 2020, the government came for the kill.
After weeks of speculations and several months of back and forths between the ride-hailing platforms and regulatory authorities, the Lagos State Government on January 27, 2020 announced a ban on all forms of motorcycles and tricycles from plying major highways in Lagos.
“After consultations with the stakeholders, the state security council, in compliance with the extant transport sector reform laws 2018 has decided to commence enforcement of the law which bans motorcycles and tricycles,” the state Commissioner for Information and Strategy, Gbenga Omotoso had announced at a press conference.
As it turned out, there was a subsisting law in the state which hitherto had banned tricycles and motorcycles popularly referred to as ‘Okada’ from plying major roads.
The transport sector reform laws had been in place since 2018 but had gone un-enforced by the administration.
It was this that the Sanwo-Olu led government simply went back, dusted, and on January 27th, 2020 announced it would henceforth be enforcing.
Lagosians were thrown into confusion. At first many dismissed with a wave of the hand but as the days went by, it was apparent that the government of the day was serious about what it said, no motorcycles or tricycles would ply major highways in 14 Local Government Areas and Local Council Development Areas of the state with effect from February 1.
These areas were Apapa, Apapa-Iganmu, Yaba, Lagos Mainland, Surulere, Itire-Ikate, Coker-guda, Ikeja, Onigbongbo, Ojodu, Eti-Osa, Ikoyi-Obalende, Lagos Island, and Lagos Island LCDA.
Two sets of people were the most affected by this directive. The ride-hailing service providers (of which ORide was as at this time now a major player) and commuters in the state.
For commuters, it was a hellish period.
On Monday, February 3rd, it was apparent life wasn’t going to be the same for commuters in the vast sprawling city.
This is because, in a densely populated state such as Lagos with a bad record of road transportation with traffic gridlocks at almost every turn, these motorcycles had come to be lifesavers for everyone, and anyone who needed to make it in time to the various nooks and crannies of the state.
This law, it would eventually turn out was the knife needed to burst the giant called ORide and force others to turn creative.
Next turn for the start-ups…
As the days turned into weeks and then into months, the various ride-hailing platforms realized they needed to find alternatives, and for the likes of Gokada, they simply moved into the logistics delivery section.
ORide, the giant in the room, unfortunately, turned out not to be so dynamic.
According to this report, with so many motorbikes in its operational fleet, ORide reportedly sold off quite a number and these other operators simply snapped them up to shore up their fleet. These bikes were reportedly sold off for as low as N270,000
On July 2nd, 2020, OPay announced that it was shutting down some of its startups chief of which was ORide. And thus came the dismantling of what was once touted as the possible Unicorn in the motorcycle e-hailing business.
