As the Twin Cities inflates with Super Bowl fans, celebrities and media personnel next week, a new ride-hailing platform hopes to take advantage of the activity.
Looking to become the future of ride-hailing services like Uber and Lyft, startup Corbata was developed by three Minnesota natives and plans to provide rides next week to a small pool of people during the Super Bowl.
Though a web application is live, they hope to make the platform more widely available by summer 2018 with the release of Corbata’s iOS and Android mobile applications.
Co-founder Jon Schoen sees his company as a service providing more than just a ride.
Like Lyft, Uber and other ride-hailing companies, Corbata’s drivers set their own schedules, drive their own vehicles and get paid for their services. But Schoen and co-founders Lance Conger and James Kruse said they want the similarities to stop there.
“As opposed to taking cuts like Uber does … we are taking no cuts at the moment, just a booking fee to the user,” Schoen said.
The company was born two years ago after Schoen and Kruse, who is Corbata’s president, met in Los Angeles and connected over their dissatisfaction with Uber and Lyft.
Kruse and Schoen were frustrated with expensive Uber rides during surge times and heard drivers complain about the company’s pay structure.
Corbata allows drivers to set their own rates, charge riders per every 15 minutes and receive 100 percent of the pay. Riders are charged a 5 percent booking fee — which is the company’s take, Schoen said.
“The biggest issue that I have is the way that Uber has restructured their pay schedule,” said Bob Bauman, who has driven for both Uber and Lyft in Minnesota and plans to drive for Corbata.
Bauman said he used to receive about 70 percent of what riders pay for each ride, but now sometimes receives only about 40 percent. “To me, that’s just not right,” he said. “What Corbata offers is an opportunity.”
Bauman, 64, became an Uber and Lyft driver two years ago. After hearing about the company from Schoen during an Uber ride, Bauman said he was attracted to Corbata’s business model, which he feels benefits the rider, driver and company.
Corbata also provides profiles of each driver, so users can choose a driver based on ratings, pricing, schedule and the experience they offer.
“You can establish a rapport with the people,” Schoen said of Corbata’s vision for driver-rider relationships. “It’s not just an algorithm.”
Drivers can be reserved for a certain amount of time, allowing riders to see the total fee up front. Riders can also preset pickup and drop-off times and will eventually be able to book a driver two months out, Schoen said.
The mobile app for the platform is not complete, so for now, riders use Corbata’s web application to request rides, though the company has only about 25 drivers right now, he said.
The startup has partnered with some of Schoen’s former clients from his time as a personal trainer in Los Angeles who plan to use Corbata to navigate Minneapolis next week. Corbata is currently collecting feedback from a small pool of riders and drivers, and hopes for more insight during the Super Bowl.
Looking forward, Kruse said the company is also integrating targeted cross-promotion into its marketing strategy, in which Corbata connects with local businesses who promote for free on the app. In return, the local businesses offer deals on their products to riders.
Schoen said the company has partnered with the Fremont Restaurant and Bar in Minneapolis and hopes to partner with at least 100 local businesses in the next three months.
Corbata is currently self-funded, and Kruse said all feedback will contribute to making Corbata a viable product that can be marketed to investors.
James Bellefeuille, the chief operating officer for Vugo, a Minneapolis-based company that installs advertising inside ride-sharing vehicles, said breaking into the industry is not easy, but it is possible.
“The ride-sharing market is huge, it is massive,” Bellefeuille said. “There are always going to be ways for smaller competitors to carve off a small chunk of the marketspace.”
He added that, though there are eight or nine major companies in the ride-sharing industry, smaller players can succeed if they find a niche and differentiate themselves from competitors.
“It’s not going to be easy, but that doesn’t mean it’s impossible,” Bellefeuille said. “It all depends on the team and how badly they want it.”
Olivia Johnson is a University of Minnesota student reporter on assignment for Star Tribune.