Sometime over the course of this week, Oway Group, home grown travel booking and ride hailing service provider, will announce the official launch of an app-based three wheeler motor bike in Mandalay, the chief center of economic and commercial bustle in Upper Myanmar.
Mini Oway, the first app-based bike service in the country will start to hit the roads with about 100 motor bikes in Mandalay, and most likely to expand up to 500 bikes, said Aung Zaw Maung Maung, business Partnerships Manager of Oway Ride.
The start-up led by Nay Aung, a Myanmar national with stints in Google and Blue Lithium, has came along the way since 2012, where it began as an online travel booking service, to emerging as a provider of a tech-based transport service provider.
Oway Ride started in 2016, providing an app-based ride hailing taxi service in Yangon.
In Mandalay, Oway rose from a B2B and B2C car rental business started in mid 2016 to a more user friendly three wheeler service.
It now claims to be a tech-oriented company that plans to offer its services across tier-1 and tier-2 cities around the country.
Oway considers itself more than just a travel platform with the introduction of Oway Pay in Yangon, and looking to expand its business by offering other services such as topping up money and using it to make payments for Oway’s services. This has yet to scale.
Despite Myanmar ranking low among interest from venture capitalists, and where government support for tech ventures is almost non-existent, unlike some of the other markets in Southeast Asia, the company has managed to attract attention from a slew of international investors. Among the investor base is the International Finance Corporation, that contributed $2 million out of the $10 million investment that it has raised in total so far. Another investor is Northstar Group, that is among of the early backers of Indonesia’s app-based motorcycle taxi company Go-Jek, that now reportedly commands a $3 billion valuation.
The Singapore-headquartered private equity firm was among the first set of investors in Go-Jek, having committed capital in the Indonesian company, through its venture capital arm NSI Ventures in 2014 and through the PE fund in 2015.
Oway Group is also looking to seal another eight-digit investment, a spokesperson had told this portal, during an interaction a couple of months ago. This will allow the company to focus more on enhancing the technology part of its business, the spokesperson had added.
This portal had recently reported that Go-Jek, which competes with Grab and Uber Technologies Inc, plans to expand its offering to more markets in Southeast Asia, targeting countries with large populations using cash for transactions. This indicates that the company will be targeting the payments space as well as the ride-sharing segment as it looks to expand in the region.
Earlier this year, US ride-hailing app Uber has forayed into Myanmar by getting on board only government-accredited and licenced taxi drivers, in a departure from how it operates in other countries, and the move was seen as a step towards avoiding legal and regulatory hurdles in the frontier market.
Myanmar has seen a sudden surge in internet-related businesses even though mobile telephony was introduced in the country only in 2014 with two operators Telenor and Ooredoo. Since then, Myanmar has fast adopted the smartphone-enabled goods and services, with ride-hailing apps amongst the biggest beneficiaries.
In July this year, after announcing that it had raised about $2.5 billion from China’s Didi Chuxing and Japan’s SoftBank Group in the largest single financing round in the region, Grab also unveiled a slew of new tech features including a localised app for Myanmar. Grab had launched services in Myanmar in March 2017.
The introduction of the three-wheeler motor bike in Mandalay intends to boost a safer approach to a different public transport service while having a fair price without bothering for a bargain, said Aye Zaw Maung Maung, business partnerships manager of Oway Ride. Drivers will be provided proper training, while the vehicles will all be licensed, have GPS installed and be in good condition, he added.
This new service is slated to provide an additional public transport mode for locals as well as tourists heading to Mandalay.
In Mandalay, taxis are not available, and randomly grabbing a motorcycle poses safety risks, while hiring a private car can also be costly.
Maung said the chief minister of the Mandalay Region also suggests priority to be given for safety and not posing a very high price.
“The three-wheeler bikes are already popular in Mandalay but the app-based system makes it a good choice for users,” said a local of Mandalay. Oway has already made a soft launch. All of the motor bikes are newly installed, recruiting drivers who were already driving. The best part is giving the driving a chance to own the bike, paying through installments.
To date, Oway has over 6000 fleets (taxis) in Yangon using its platform, which offers customers to connect through a call center as well as through its app.
With the Myanmar government currently putting a priority on transforming the public bus system, the next step step could be reforms and regulations in the taxi space. While the taxi space is poorly regulated now, the ride-hailing apps have brought about significant improvements, as they all use tech platforms, and are already competing with each other, mainly providing taxi drivers with a slew of incentives.
While all ride-hailing apps operating in Myanmar offer promotion codes for users, Oway went a step further last week, when it introduced a new lucky draw promotion for riders.
Off late, the taxi space in Myanmar has seen significnat improvements, both in safety as well as convenience for both drivers and passengers. The ride-hailing apps have also boosted the sector’s productivity by offering an improved booking processes.
However, Oway’s spokes person finds this “not sustainable” unless the system is changed and regulations setup. This includes transforming the cars and drivers, pricing.
With motorcycles not allowed to operate in Yangon, locals have to rely on buses and taxis for daily use. Yangon, which has a population of 7.4 million, currently has more than 70,000 taxis running on its roads.
Earlier this year, the Yangon regional government had allowed Tint Tint Myanmar Company to operate a water taxi project along the Hlaing River in Yangon.