After Reaching Profitability, Carpooling Platform BlaBlaCar Has $108 Million Debt Line | Tech Crunch

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BlaBlaCar is an iconic name in the French startup ecosystem. The carpooling and bus ticketing company has been around for so long that it can hardly be considered a startup anymore. Still, BlaBlaCar is a very interesting company today because of its unique trajectory.

The startup, which began as a scrappy online hitchhiking community, has raised hundreds of millions and reached unicorn status. It expanded to several countries on several continents, then scaled back its ambitions and started thinking about profitability.

Today, the company announced that it has secured a €100 million revolving credit facility ($108M at today's exchange rate). This gives it a new war chest to plan for the future and sustain growth – including acquisitions.

“Debt is a relatively attractive, non-dilutive and super flexible instrument,” Brusson told us. The €100M credit line is with several major banks in France, the UK and the US

BlaBlaCar is currently not paying any interest as it has not yet tapped its line of credit. But Brusson said he plans to use the loan facility to buy smaller companies. Many startups are struggling because they can't raise their next round of funding, BlaBlaCar can buy these smaller companies.

It has been profitable for the last 24 months

Although BlaBlaCar is not a public company, it is slowly accepting the fact that it can share some metrics more publicly. Thus, BlaBlaCar reveals for the first time that it has reached profitability – in fact, it has been profitable since April 2022.

This milestone comes as a relief as 2023 is a challenging year for French startups – unless you work on artificial intelligence products.

“The whole business is profitable. We've been profitable for almost two years,” co-founder and CEO Nicolas Brusson told TechCrunch. “Except for the first two months of 2022, it's almost a full year post-Covid. We've posted revenue of €195 million. And we're basically Finished a little on the negative side, but it was a really terrible Q1.”

“But from Q2 2022 onwards, we are profitable. Then, in 2023, our revenue will increase to €250 million. So we're experiencing a little less than 30% of top-line growth and we're still profitable.

Profitability means different things to different people. Many companies like to talk about EBITDA but claim to be profitable — a financial metric that doesn't take into account the costs associated with the company's assets. And Brusson is a bit fed up with the company pretending to be profitable and actually losing money every year.

In the case of BlaBlaCar, the company is profitable on an EBITDA basis, but also generates net profits when you consider everything – BlaBlaCar doesn't own cars or buses anyway.

In 2023, 80 million passengers booked a bus or carpool ride on BlaBlaCar. And the good news is that there are BlaBlaCar users all over the world – not just France.

“Brazil is bigger than France in terms of number of users. I think India will be bigger than France in the number of carpool rides next year,” Brusson said.

The company hasn't yet started monetizing its users in India, Brazil, Mexico or Turkey — it doesn't take a cut of carpooling transactions. This gradually adds to the booking fees, which also helps in increasing the company's revenue.

A blight is Russia. When the war broke out in Ukraine, BlaBlaCar had millions of users in Russia. While many tech companies decide to sell their Russian subsidiaries, BlaBlaCar's Russian operations are completely separate from the rest of the business, but BlaBlaCar has no plans to sell it. Brusson argued that this would be counterproductive as it would essentially give it to a Russian-based employer.

“Today, this represents a return of just under 5%, so it is very small. It is still part of the group, but it is completely separated and managed independently… the company is completely separated from the group. But if you want to sell it, in the present case, it is like giving away.

Adding train tickets

In Europe, BlaBlaCar wants to integrate all ground transportation methods. In addition to carpooling and bus rides, the company plans to add train tickets. Users will be able to purchase tickets over the next year or so.

“Our idea is to combine it with carpooling. So we're able to offer trips with rail as well as carpooling — almost door-to-door,” Bruson said.

Even if you don't book your next train journey on BlaBlaCar, the company is experimenting with last-mile carpooling. “In that case, we have a different model for slightly shorter distances. The idea is to connect train stations with your destination. Usually, if you get to Oneness Station, you often have to go to your grandma's house, your vacation home, your weekend getaway. You still have between 10 km and 40 km to go,” he noted.

Since many BlaBlaCar users are already driving in that direction, the company pings those drivers to see if they can pick up a group of people at the train station and drop them off at their destination.

In non-European markets, bus rides represent the biggest opportunity. “The good news for us in these markets is that bus remains a very offline and fragmented industry,” Brusson said. He pointed out that people are spending billions of dollars on bus tickets in India and Brazil – once again, suggesting BlaBlaCar has room to grow.

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