“A bike and a battery and a very big dream”

How Uber and vALTERNATIVE launched a joint venture in less than a year

Less than a year after being introduced at Africa’s Green Economy Summit in Cape Town in February 2023 and joining forces, Uber Sub-Saharan Africa and the emobility startup vALTERNATIVE Energy have launched Uber Package. It is a new same-day, on-demand delivery service performed by drivers on ebikes.

In the run-up to the next Africa’s Green Economy Summit, Kagiso Khaole, GM of Uber Sub-Saharan Africa and Mahomed Jeewa (MI to his friends), Founder and CEO, vALTERNATIVE Energy agreed to sit down for an inspiring conversation about their first meeting, that handshake, South Africa’s changing bike culture and some sage advice for other startups in the green economy space.

The handshake
Kagiso remembers their first meeting very well: “I think at the time, all you had was a bike and a battery and a very big dream.” He adds that one of the things that excited him, evaluating vALTERNATIVE as a business and seeing what potential could come out of collaboration, was the diversity of the experience of the team.

He explains: “You had already started connecting with government as well. You were really looking to be a full ecosystem player. And I think that was something that stood out at the time. And I think that’s what got the ideas flowing. I was also really encouraged about the discipline and structure in the back end. It was really building for the long term as well. And yeah, I can’t forget the handshake that we had to, at least, have another conversation, right?”

Mahomed agrees: “I’m glad that you understood it back then: Yes, vALTERNATIVE is a startup, but if you look at the seasoned entrepreneurs that are involved in the business—whether it’s technology, finance or operations—it led itself to where we are today. And yes, that million dollar handshake, when you told us there’s no deal (laughs). And now, well, we have the hard work that both teams put into this project. We have got something that we can really be proud of.”

Very customer-centric
For the Uber executive the discussion around the product portfolio and rebuilding it bottom up with the consumer in mind was also key. “It wasn’t trying to fit a product and mashing it up into a service and giving it to customers. I think we really took our time to look at where the opportunities were. We ended up landing on electrified Uber Package. And I think that was a very good decision. And I think the steps that you took where it was very customer-centric, where even the bikes were designed for the South African market. I think that puts us in a great position to scale like we’re busy doing into the long term as well.”

Making it sexy
The startup project experienced the usual setbacks and delays, including with regulations and certifications and even a 45-day holdup in the Durban Port.

“The other major challenge we had was trying to empower the youth” says Mahomed. He explains: “both Uber and vALTERNATIVE would like to empower the South African youth. And we all know that the last-mile is dominated by foreign nationals, and we actually employ both now, but trying to empower the youth has been a serious challenge. So what we’ve done is create some training programmes. And because of my history in the fashion industry, we are actually kitting out the youngsters in nice uniforms, fancy helmets and the electric bike looks nice. So we try to make it sexy for the youth of South Africa.”

Fuel versus electricity
Both men were surprised by the enthusiasm of the riders to adopt electric bikes. Says Kagiso: “We know South Africa doesn’t have a bike culture, and you have to change people’s perceptions about riding motorbikes. I think we started really well and I’m really keen to see it scale up and try to get more youth to have these earning opportunities and make money for themselves. It’s going to be really important that we get that right.”

“The major difference, even for the young South Africans,” Mahomed explains,” is when they look at a petrol bike with its gears and clutches and noise; it’s a bit intimidating. Once they jump on the electric bike: it’s automatic, there’s no sound, it’s smooth, there are no vibrations. The uptake, even for the riders that have been riding for many years, they actually cannot believe what an experience it is. And there’s a massive cost saving also around fuel versus electricity. So the riders that we’ve already put on the road are extremely happy with us.”

Kagiso: “Again, it encourages other projects and other companies to really be bold and take a few chances in terms of moving their businesses to the green economy. People are ready for it. You just need to go out and build it.”

Manufacturing
And that is exactly what Mahomed and his partners at vALTERNATIVE are doing. “We definitely see the opportunity for scale on another level. For example, China in the last few years, I think they came out with a hundred new car manufacturers, right? So the opportunity for the manufacturing sector in South Africa is tremendous. We plan to put up a plant by early next year and hopefully export to the neighbouring countries. It’s easier to enter the market. Obviously, there’s some battery technology and technology that needs to be learned and adopted. But you don’t have an engine that has a few thousand parts in it, right? So the transition is much, much smoother. I foresee the last-mile of the emobility sector growing at a rapid scale.”

Furthermore, because of the demand, the company is launching two consumer bikes by the end of this year. Says Mahomed: “The youth of today, they want to save on costs and save the planet, something light on its feet, and a two-wheeler electric bike ticks a lot of boxes.”

Advice: Focus, good team and hard work
Entrepreneurship is so important for the future of the continent’s economic growth. Do Kagiso and Mahomed have any advice for other green entrepreneurs? “For vALTERNATIVE, we’ve already been speaking to a few investors around the country,” says Mahomed. “If anyone’s interested, they can just drop us a message on our LinkedIn page.”

Kagiso laughs: “I think that’s a good piece of advice for green entrepreneurs, always be selling, right?”

Mahomed: “Yeah. My advice is basically three things: One is focus. You’ve got to focus on the exact problem and solution that you’re solving and going down the line of creating a company like for us at vALTERNATIVE. You get sidetracked along the line at so many different opportunities. The trick is to stay focused on the first idea that you had and see that through. It’s like for us, we started with the last-mile delivery bike. There are multiple products coming after that, but until we got that product right, and we got our customer, and we got a direct route to market, stay focused. Second piece of advice I would say is get the right team. We are lucky, at vALTERNATIVE, I managed to build this business with five partners, five founders. Four of them I know from the age of six years old. So it’s quite an exciting story. And it’s that kind of trust and loyalty that you need to grow a business. Third, the world thinks that you have a bright idea, you put together a nice business plan, you put together a pitch, and you’re going to raise money. It doesn’t work like that. You’ve got to have skin in the game. You’ve got to work at it, day in, day out. Myself and the team, I think we put in 16-hour days for the last 12 months. It’s been long, it’s been hard, but if you put in the time, you’ll see the results.”

Kagiso concurs: “There are opportunities everywhere, but they show their heads at very specific times. And I think this is a time where the whole landscape is shifting. If you have something that you think will be able to add value, pursue it, run after it in a big way. Solve problems in South Africa, and I promise you, you are solving problems for a lot of the world.”

The next edition of Africa’s Green Economy Summit, taking place from 21–23 February 2024 in Cape Town, features a pitch session of almost 30 start-ups in the green economy space. These companies will present their groundbreaking solutions and technologies for investors who are looking for the next big opportunities in sectors such as energy, emobility and storage.

For the full transcript of this interview, click here: https://wearevuka.com/press-release/a-bike-and-a-battery-and-a-very-big-dream/

To watch the full interview, click here: https://youtu.be/PssoTWbqfj0 

Photograph courtesy of SMA – Uber: More than just moving people but also driving impact | VUKA Group (wearevuka.com)