LULA, a ride-sharing service for office workers, has acquired the South African branch of Zeelo, a US-based bus-sharing startup. The financial details of the deal have yet to be disclosed, but both companies confirmed the acquisition. Zeelo started operating in South Africa in 2019, raising $33 million and providing over 2 million rides yearly. Now, Zeelo is focusing on its main markets in the US, UK, and Ireland, leaving its South African operations behind.
LULA plans to use Zeelo’s existing 18,000 riders to expand its reach in South Africa. By integrating Zeelo’s services, LULA aims to increase its share in the country’s transportation sector.
Transport costs are high for South African workers, with personal car expenses averaging R2,180 ($121) per month and taxis costing R960 ($53) monthly. Ride-sharing platforms like Uber for Business, MoveInSync, and LULA help reduce these costs for employees, making them valuable for companies.
Founded in 2018 by Velani Mboweni and Xabiso Nodada, LULA operates in five major South African cities. The platform has provided rides for over 380 companies and has a network of more than 1,000 drivers and shuttle operators. LULA doesn't own vehicles but partners with drivers and fleet operators, earning commissions of 20% to 40% per ride.
This acquisition is expected to make LULA financially stronger, allowing for future growth. Velani Mboweni, LULA’s co-founder, emphasized smart growth over fast growth, saying, “It’s better to scale smart than to scale fast.”
Sam Ryan, Zeelo’s founder and CEO, is confident in the transition, stating, “We are excited to support the move of our customers and suppliers to the LULA platform.” This transition is expected to benefit both Zeelo’s and LULA’s users.
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