11th February 2018
It’s a bit like iTunes. Only instead of choosing a song, professional drivers are selecting a type of vehicle: taxi, ride-share car or limousine.
That’s how taxi-driver-turned-entrepreneur Harry Katsiabanis describes his new company called P2P – one of the nation’s biggest commercial vehicle rental businesses, now listed on the Australian Stock Exchange.
When a driver walks into one of Mr Katsiabanis’ eight depots in Victoria, NSW or Queensland to rent a car, they can opt into whichever market they believe will be most profitable that day, week or month.
“Transport is now a changing landscape so we have created a changing model,” said Mr Katsiabanis, executive director of P2P.
“We can change vehicles as per the market conditions. So if taxis are more popular today, I can bring in the ride-share vehicles, spray them, put a dome light on and fit them with a meter. Or if ride-share becomes more popular, I can bring taxis in and spray them, re-upholster them … so the assets have the ability to morph and change as per the market wants.”
Mr Katsiabanis, who has spent most of his 30-year career in the taxi industry, knows the consequences of sitting on a stale asset. He bought his first taxi licence at 21 and over decades grew his fleet to 12, but said he has been “robbed” by the state government, which, in its moves to deregulate the taxi industry, bought back Victorian taxi licences at prices well below their value. Many of his friends in the industry had since been left “depressed, gone bankrupt, have had to sell their family home”, he said. “It was unfair.”
But the man who has hustled since he was a boy, sourcing second-hand sporting equipment to sell to school friends, and selling imported garden tools from the boot of his cab, is accustomed to thinking on his feet.
“The reforms that wiped out my wealth made me think differently,” he said.
Mr Katsiabanis travelled overseas to learn about new business models that were thriving in the ride-share market, and discovered Indonesia’s largest taxi operator, Blue Bird. He decided to model P2P on the company.
Over a month in mid-2017, he and his partners raised $30 million in a float with an issue price of $1.32 per share.
The company worth $110 million, has 80 employees and 4000 drivers signed up. The expanding fleet is now nudging 1000 cars.
The company differs from other taxi operators not only in its broad vehicle offering, but in that every step of its value chain is taken care of internally. This includes driver training and vehicle repairs, fuel, and servicing.
Mr Katsiabanis is also soon launching a new mobile phone app called Ride247, which will enable passengers to book taxis, ride-share cars or limousines at fares discounted up to 20 per cent on the market rate. It will also offer flat fares to the airport.
Drivers in a taxi or Uber can sign up to this app to scoop up more work when business is quiet mid-shift. If a limousine is closest and the driver wants to do the job, they will offer the lowest price.
The drivers don’t need to have hired a car from P2P to sign up to the app.
Mr Katsiabanis has a record of innovating in the taxi industry, having founded taxi booking application Taxilink and TaxiEpay, the first real alternative eftpos system to Cabcharge which was acquired by Live Group.
The state government’s second tranche of legislation deregulating the taxi industry – which has passed Parliament – is aimed at putting cabs on a level playing field with ride-share companies by allowing booking service providers to set their own fees. They will come into effect this year.
The Taxi Services Commission said UberBLACK, UberX and Taxify were now accredited with the regulatory body, which will require all drivers to have passed police, medical and driving history checks.