Kolors, a Mexico City-based startup, says the platform connecting intercity bus drivers with bus drivers is like “if Uber and Southwest Airlines had a baby.”
Like Uber and other ride-hailing platforms, Kolors does not own vehicles but partners with small and medium-sized bus companies that already offer scheduled services. And like Southwest and other airlines, passengers are coddled by a bus attendant, a Kolors employee who checks passengers in, accepts cash payments when needed, and sells snacks and drinks.
In emerging markets, similar products are creeping forward to address what Kolors CEO and founder Rodrigo Martínez says is an outdated industry. In Africa and the Middle East, Treepz and Swvl use a similar model for both intra- and intercity bus journeys, minus the bus conductor. Part of the push to digitize the bus industry is because the technology exists now. But as GDP in emerging markets soars, so do consumer expectations for higher quality products, making busing, the lifeblood of countries like Mexico, the perfect industry to disrupt.
“People want more, they demand more for the services,” Martínez told gotechbusiness.com. “The new bus passenger is millennials and centennials who want better service than the incumbents can provide. Companies like Greyhound have been around for over a hundred years and that one was bought by Flixbus, a nine-year-old startup. It’s about seeing what technology and data-driven optimization can mean for the services.”
Kolors estimates that the intercity bus industry is worth more than $100 billion, with a potential of $20 billion in Latin America alone. It’s clear that major mobility investors are also convinced of the potential behind this undervalued industry, as the startup just closed a $20 million Series A, bringing total funding to $26 million. The round was led by UP.Partners with participation from Toyota Ventures, Maniv Mobility, K5 Global and Mazapil, as well as existing investors. Kolors will use the money to deepen and expand its coverage in Mexico and parts of the US to other Latin American countries, likely starting with Chile.
The bulk of that funding will go towards improving the company’s tech backend, a “smart bus platform” that is based on a combination of aviation and ride-hailing technology and provides route optimization, booking, scheduling, pricing. , marketing, sales and customer service, the company says.
The platform also collects data on, among other things, which products passengers buy on board bus staff. Martínez says Kolors will also sell “additional products and services” as a means of building various revenue streams, as an airline would.
It’s the customer experience and the touch of luxury that Kolors focuses on, says Martínez. Kolors only works with bus operators that run coaches or luxury buses with free WiFi. The more expensive buses will come equipped with fully reclined seats for the night, something that’s really non-negotiable if you’re taking a 30-hour bus ride from Tijuana to Mexico City.
“The bus conductor not only helps us to provide a better experience for our passengers, but also to ensure the quality of every Kolors trip,” said Martínez. “Because in the end it’s not our buses, we don’t employ the bus drivers because they are employed by their bus company. But the attendant allows us to make sure that every Kolors experience is the same or very similar no matter who the partner is or which bus it is.”