Moto-taxi Mobility Transformation

More than 10 million moto-taxi commercial transport operators move commuters within African cities today, 99% of which are informal, untrained, unidentifiable, unregulated and vulnerable as they have zero access to social insurance programs and/or financial services. 

Through MAX, we have been able to develop an entire value chain that has empowered over 2,500 informal transport operators with digital identities, low cost financing for quality vehicle  acquisition, discounted comprehensive health & vehicle insurance, a technology platform, safety equipment  and training.

The MAX platform protects drivers from the vulnerabilities associated with the informal transport operations, especially adverse government policies, incessant accidents and income deprivation. Drivers also grow their income level in a sustainable manner. For context, an average MAX driver earns between 3x-5x the Nigerian minimum wage.

The MAX platform protects drivers from the vulnerabilities associated with the informal moto-taxi operations. The informal operators are neither licenced, tracked nor their identities known to the government. This vulnerability made them the target of adverse government policies made in response to security and safety issues in the industry.  

In response to this industry challenge, MAX started building a platform that would revolutionize the transportation system in Nigeria. This platform would manage driver identity, vehicle registration, remote tracking and tax collections for state governments. This ensures that the Government has greater visibility and control over the State’s security apparatus which also aids the implementation of safety and security standards. 

The project is proposed to be the solution to protect the most vulnerable class of operators and help the industry build resilience.

We have spent the past five (5) years working with moto-taxi operators understanding the core of their realities and improving our solution to become the most impactful transport intervention on the continent today. We discovered that an average informal motorcycle operator is faced with prohibitive cost of financing for asset acquisition, unsafe working conditions and other forms of vulnerability, especially in a society with no safety nets.

We realized that the only way to transform the sector is by developing a comprehensive solution that overcomes the major barriers at once. Our comprehensive solution empowers them with digital identities, discounted (vehicle, accident and medical) insurance, defensive driving skills, quality vehicle financing, digital payments, electric vehicle infrastructure and an e-hailing platform (MAX.ng) that helps our riders connect to commuters and businesses in real time.

The WURI program aims to increase the number of people who have a unique proof of identity recognized by the government and which facilitates access to services. 

MAX’s ultimate goal is to empower over 10 million informal transport operators with digital IDs, discounted (vehicle, accident  & medical) insurance, defensive driving skills, quality vehicle financing, digital payments, electric vehicle infrastructure and an e-hailing platform (MAX.ng) that in turn helps them provide 1 billion Africans with safe, efficient, reliable and sustainable transportation.

There is no doubt that the inventions needed to eradicate poverty already exist, the innovation lies in how we deploy these inventions to holistically defeat the menace of poverty in our society. While many aspects of the MAX model existed before MAX, it was mostly fragmented in a way that those who needed those services the most were disenfranchised. Basic medical insurance has always existed but not access for informal transport operators. Ride-hailing platforms have always existed but informal transport operators had no access to it.

What makes MAX innovative is how our approach tackles poverty holistically.  We start by empowering them with unique IDs, training them, helping them become properly skilled in defensive driving, then provide them with asset financing for vehicle acquisition, digital wallets for financial transactions, helmets and smartphones. To provide safety nets for them, we provide them with medical insurance cover, vehicle insurance, accident insurance and life policy. 

Using our platform, they seamlessly connect with customers in real time to ensure that they continue to generate revenues. We believe that this is the most sustainable approach because it creates even bigger opportunities for the next generation to prosper and this is what we believe makes MAX one of the most innovative social enterprises in the world.

MAX has built mobile and web applications that connect customers to moto-taxi riders in real-time. It uses google maps and our in-house dispatch technology to do this match within a set radius. The dispatch system is able to match requests from customers and recognize the riders who are available to accept while providing ETA information to the users upon a successful match.  

We ensure we have the best quality riders by also utilizing our recruitment application that manages prospect recruitment, identity verification, rider training as well as administering psychometric tests. Once the riders are on-boarded, we provide digital wallets for the riders to receive payments for trips. We have partnered with fintech companies and banks to ensure that these Moto-taxi operators can make transactions using the funds in their wallets with or without having traditional bank accounts. 

MAX's apps are powered by APIs built on various micro-services within the MAX architecture. The MAX technology stack comprises the following technologies; NodeJs, Typescript, ReactJS, Docker, Kubernetes, MongoDB, Postgres, RethinkDB, Redis, Firebase. Java, Kotlin, Swift.

The MAX Theory of Change comprises four (4) major activities and they all have their respective immediate outputs, short-term outcomes, medium term outcomes and long term outcomes as outlined below.

1. Our Drivers’ enumeration, training & licensing program empowers our drivers with top-notch defense driving skills and identification tags that immediately results in the availability of well trained, traceable and licensed drivers to commuters in Nigeria. This in turn formalizes the sector and bestows our drivers with public trust as being safety conscious while driving, using helmets and other necessary PPEs and as result, they are able to enjoy access to policies and programs designed to reduce poverty and vulnerability like social insurance. 

2. Our asset financing and deployment program provides access to income generating assets for the un-banked with flexible repayment plans which in turn also ensures that high quality vehicles are available for commuters at affordable  rates. This results in the short term outcome of drivers being empowered with wider access to 5x more customers and earn over 200% more income as a result of brand association. In the medium term, the drivers enjoy increased income and ultimately have improved livelihoods and access to basic medical insurance for themselves and their families. 

3. Our ride hailing program which leverages the use of technology to match trip requests to drivers on our platform which also enables real time trip analysis and tracking. Commuters spend less time in traffic, which results in reduced traffic related stress for commuters and ultimately results in improved health for commuters and better productive use of time for commuters.

4. Our last mile delivery program connects retailers, farmers and small businesses to last mile customers in real time, ensuring that they can deliver their goods in a reliable and efficient manner. In the short term, this enables small businesses access new and hard to reach customers, promoting e-powered commerce across Africa. This enables small businesses to grow their individual customer bases and in turn, create more sustainable jobs. 

You can also check out this Impact Report of our model and operations published by BFA Global and Shell Foundation. 

As of today, all operators that have been onboarded on our platform enjoy access to insurance and are indemnified against hazards and accidents. Furthermore, we have built in digital wallets into our technological system such that our drivers can receive and send funds digitally without the hassles of opening a bank account. Through this system, they can also save money and make contributions to social insurance schemes. 

In the long term, as we continue to engage the government to further empower informal transport operators in cases of economic shocks, governments will be able to make direct G2P payments to individual wallets on our platform as one form of palliative or the other. 

A key thing for us is providing an easy to use and intuitive rider application that allows these riders to accept payments on their digital wallets. They can receive and send money to other beneficiaries straight from their MAX rider application. Our mobile technology is essentially built to empower West Africa’s fragmented and informal motorcycle taxi industry.

We have easy to access APIs that allow SMEs and other third party users to connect their websites and apps to our dsystem. With the goal of providing technology that is easy to use and accessible we provide detailed documentation for easy integration with other systems. 

For example, by integrating to our APIs, third parties have access to request for a MAX rider from our platform, see rider ETA to pick up and drop off locations, receive in-app notifications as well as view the pricing for each trip. We ensure very transparent pricing on our APIs and third parties are able to easily switch to other dispatch/logistics options if they feel the need to. 

In our operations today, we on-board informal transport operators in their local languages, administering testing and training orally because many of them can not read and write in English 

This enables us to ensure that operators with low literacy and numeracy levels are not disenfranchised. Our relationship officers who interact with many of them on a daily basis also communicate in their respective local languages. 

While we are very hopeful for wider internet coverage in Africa, we are also working on ensuring that our users can use their digital wallets offline via USSD. This ensures that they continue to enjoy financial services while in low connectivity environments seamlessly. 

Till date, we have onboarded 2,500 drivers and have successfully empowered them with unique IDs, discounted vehicle & medical insurance, defensive driving skills, quality vehicle financing, digital payments, electric vehicle infrastructure and an e-hailing platform (MAX.ng) across four (4) Nigerian cities; Lagos, Akure, Ibadan & Kano. 

Within the next one year, we plan to grow this number to 5,500 drivers, expanding to six (6) Nigerian cities in the process. And in five years, we plan to have expanded to four (4) other West African countries, onboarding a total of 100,000 drivers in the process.

MAX's mission is to empower over 50 million informal transport operators in order to make mobility safe, affordable and accessible to 1 billion Africans. As an organization, our goal is to provide a decent source of income for the women and men who can drive/ride a commercial vehicle or are interested in learning how to drive/ride as a source of income. 

We will also continue to create a safer, cleaner and more reliable and accessible means for people to commute. We are driven to create more opportunities and innovations that help our drivers to generate more income. MAX completed its series A fundraising  in June 2019 and we are currently pursuing our next growth phase and would like to connect with strategic investors and partners with interest in 2-wheel and 3-wheel mobility as we continue to expand into other transport means. 

We’ve invested in launching 3 apps over the past 1 year and have achieved product-market fit in Africa. We are partnering with auto-financiers and complementary digital platforms to drive user adoption, scale our technology, on-board more drivers and launch new cities in West Africa. We are also putting a good amount of money to accelerate growth and to take significant market share in the 300 million rides/day moto-taxi market in West Africa within the next year. Our ultimate goal is to make mobility safe, efficient and affordable for 1 billion Africans within 5 to 10 years and empower millions of drivers giving access to credit, financial freedom and promoting economic development.

Apart from the barrier of lack of reliable demographic data that can aid informed decision making, one other major barrier we've faced has been in the area of unlocking cheap non-collateralized financing of vehicles for drivers. We have faced other challenges such as absence of a large pool of skilled mobility experts, and some push back from local mafias controlling traditional/informal transport operations. 

To overcome the barrier of the lack of reliable data, we are investing significant resources into research. We recently embarked on a major electric vehicle/productive use of energy research project in partnership with Shell Foundation which is already yielding significant results.

We are structuring sophisticated modes of financing that guarantees sustainable and low cost financing. We have structured a receivable-backed private bond programme that significantly reduces our cost of financing to 12%. We have also structured a supplier financing with a major manufacturer  that further reduces the cost of financing to a single digit. 

We are working hard in partnering with Ministries of Transportation of various States and other Government institutions such as FRSC (Road Safety Agency) to drive adoption.

Adetayo and Chinedu cofounded MAX in 2015. Adetayo started his entrepreneurial journey by founding Trinitech Systems; a software development and communications infrastructure startup. After this, he became an Applications Lead and Product Manager at a Shell Natural Gas Company, before going on to become the VP of Logistics at Konga: Nigeria’s pioneering e-commerce startup. 

Chinedu started his own journey as an Engineer, studying Electrical and Computer Engineering at the Illinois Institute of Technology, Chicago before becoming a developer in the credit derivatives team at Goldman Sachs. He then joined Barclays Bank in New York, as a Mortgage technology analyst, before transitioning into a cash-equities trading professional. 

Adetayo and Chinedu met at the MIT Sloan management program in 2014, and drawn together by a mutual drive to transform mobility in Africa, the two came together to build MAX. Today, our work has attracted a lot of support that has helped us grow our work at MAX, mobilizing over $10m in the process. Furthermore, the founders - Chinedu and Adetayo, are recipients of over 20 awards and fellowships including, Mastercard Foundation and MIT Legatum Fellowships.

Our major shareholders and investors includes;

• Yamaha.

• Mastercard.

• Shell Foundation.

• Techstars Ventures.

• Novastar Ventures.

• Goodwell Investments.

• Harambeans Prosperity Fund. 

• Breakthrough Energy Ventures. 

Apart from our key investors, we have partnered with Investment banks, commercial banks and microfinance banks to provide financing. These include: 

• Dunn Loren Merrifield

• VFD Microfinance Bank

• Union Bank

• Mkobo

MAX operates a radically different model from traditional delivery and transportation companies in Africa. MAX neither owns vehicles nor hires full time drivers. MAX partners with drivers, and provides asset-finance and mobile apps that connect them with commuters and businesses in real time. Unlike other 2 and 3 wheeled ride hailing platforms, MAX has integrated a speed limiter into its motorcycle fleet to re-assure safety for commuters. We do not charge commuters on time spent commuting but strictly on distance covered. Most importantly, MAX provides drivers access to premium grade motorcycles.

MAX's apps use GPS addresses and google maps to navigate complex road networks, in addition to capturing user provided address descriptions and landmarks to guide riders. This helps MAX riders navigate faster than traditional motorcycle taxis. MAX is turning Infrastructure barriers into Competitive Advantage by creating its own driver licensing system, building a network of credit providers, implementing an IoT network to secure vehicles, providing digital wallets to drivers and enabling mobile payments. MAX uses transaction data to build credit history and provide financial services to drivers.

We make money from asset-finance and leases. We add a 15% to 20% margin to the cost of financing and on-boarding drivers. MAX enforces the use of helmets for both drivers and passengers, provides transparent pricing and allows users to move quickly and safely.

MAX generates revenue from 2 main sources:

• Leasing margin of approximately 20% on our motorcycle financing business. Considering that motorcycle taxi drivers are typically charged very prohibitive mark-ups, of up to 200%, through the informal channels, our value proposition is seen as extremely competitive by our Riders;

• Last-mile delivery fees of $1.80 per package. As we continue to generate increased appetite for providing asset finance to the transportation and ride-hailing industry, we will continue raising funds for asset-finance from an ever expanding list of capital sources, including commercial banking partners, development finance institutions, institutional investors and crowdfunding sources. 

Also, as we expand across West Africa over the coming months, we will scale our technology infrastructure, deploy an expanded range of financial services to the sector, introduce an electric vehicle (EV) fleet and deploy new vehicle categories. We will keep tapping into additional venture capital funding from our existing and new investors.

In March 2016, we raised a $1m seed round from Techstars, Olive Tree Capital, Venture Garden Group, RightSide Capital Management and a few angel investors.

In 2018, we received $300k in grant funding.

In 2019, we received about $1m in grant funding.

In June 2019, we raised $6m in equity from strategic investors including:

• Novastar Ventures;

• Breakthrough Energy Ventures;

• Yamaha Motor Corporation;

• Goodwell Investments;

• Zrosk Investment Management;

In Nov 2019, we raised $500k in equity from Mastercard.

By the end of 12 months from now, we target $15m in equity funding to expand into additional cities and countries across Africa, deploy a full suite of digital identification & financial inclusion solutions, scale our technology and physical infrastructure, and also deploy electric vehicle charging infrastructure.

We are essentially at our growth stage at the moment. We are enumerating and empowering hundreds of informal transport operators across Nigeria monthly and we want to ramp up the momentum and increase these numbers to thousands of operators. 

This project would allow MAX to fix financial inclusion, safety, security gaps for moto-taxi riders.Without external funding, MAX would scale at a much slower pace.

Not only will the WURI West Africa Prize provide us with additional funding that will help us negotiate cheaper insurance premiums and wider access to social protection programs for operators on our platform, it also connects us to a wider network of professionals that can support us in solidifying our growth structure and ultimately expand our impact across the African continent.