This article is contributed by a Singapore-based investor who has previously lived in Europe, with slight editing from TLD. The author, who wrote a previous piece about why Mobility-as-a-Service does not work in Southeast Asia, prefers to remain anonymous. Comments and discussions can be channeled through [email protected]
Zipster, “Asia’s first all-in-one transport” app launched by a company called MobilityX, has finally, and predictably, met its demise.
It has been removed from the App Stores, and server links have been cut off from downloaded apps.
The short lifespan
In 2018, MobilityX reported ‘seed funding’ from SMRT, one of Singapore’s two major mass transit operators, to “to provide integrated “mobility-as-a-service” (MaaS) solutions to commuters and companies”.
Colin Lim, the then appointed CEO of MobilityX, had been working for SMRT for more than 3 years. In my opinion, seed funding a company instead of just launching it as a corporate venture was the right thing to do for SMRT (or any other corporation trying venture building).
The Zipster app was the main product of MobilityX. After launching in 2019, it attracted “more than 6,000” downloads in 100 days. If you have ever worked in consumer tech, you would know that this number is, frankly, rather small.
Causes of failure?
Stories of it not going well started in the chatter before the pandemic hit. I overheard from the chatter that some stakeholders blamed the inflexibility of Land Transport Authority (LTA), Singapore’s transport regulator (and asset owner), as the key reason why Zipster did not take off. “LTA does not allow them to resell public transport fare at a discount or monthly package”, someone close to Zipster’s operations told me a while ago.
However, this is missing the point. Zipster was flawed in its whole business model design and high level strategy in the first place.
When the high level strategy is wrong, no matter how competent and hardworking the executives are, the venture was doomed from the beginning.
Let me make a few comments here:
- Mobility-as-a-Service does not work in Southeast Asia – I have made these points quite clear in my previous commentary.
- I do not have specific stats with me, but I highly doubt that a typical urban commuter in Singapore starts their interaction with an app through a “journey planner” on a regular basis. They know very clearly the route for their daily commute – and for ad-hoc/non-routine journeys, Google Maps does a pretty good job.
Google Maps are installed in most phones by default, while as a startup MobilityX has to embark on a very expensive journey to acquire users.
In other words, “journey planner” should NOT be the entry point for the consumer’s user journey with any mobility app in Singapore.
- “All-in-one” apps are a dangerous route to take for any venture just starting up. Experienced consumer tech product managers can tell you that educating users is the most difficult thing to do.
A workable alternative approach is finding a single use case where the pain point is painful enough for users, and the users use it frequently enough. You start by building a simple product to just address that pain point. Is it finding the bus arrival times? Is it notifications for MRT breakdowns / bus diversions?
Once you have managed to acquire enough customers, who have good experience in using your app for that single use case. You can build on top of it. This is how Shopee succeeded, this is how Alipay succeeded, this is how Grab succeeded – no exception here.
Any consultant who tells you to build an “All-in-one app” or “one stop solution” from the beginning should be seriously grilled.
- MobilityX management spent a lot of time and effort building partnerships – this is evident from their list of press releases.
While many of the names are certainly impressive (and add to the credibility), it matters less to users of Zipster, which is a consumer-focused service.
Consumers are not going to verify whether you have been invested by Toyota or working with SingTel before they decide to use you or not. They care about whether your app solves a key pain point for them, or satisfies a key desire they have, period.
Caution for corporations
I can go on to expand the list and enumerate more reasons, but let me stop here because the list above is already enough to allow us to rethink the direction of a venture.
For corporations looking to innovate, you probably want to think through these issues before making any venture investment commitments.
Alternatively, you can talk to consultants who have actually built consumer tech products before.
And please, do not try to build another Mobility-as-a-Service venture in Southeast Asia.
Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected]