LULA Grows by Acquiring Zeelo’s South African Operations

LULA, a ride-sharing platform focused on office workers, has acquired the South African operations of Zeelo, a US-based staff bus-sharing startup. The financial details of the all-cash deal remain undisclosed.

Zeelo, which entered the South African market in 2019, has amassed a significant user base, facilitating over 2 million rides annually before its exit.

The company made the strategic decision to leave South Africa to concentrate its efforts on its core markets in the United States, United Kingdom, and Ireland.

This presents a golden opportunity for LULA to leverage Zeelo’s established presence, which includes a network of more than 18,000 active riders.

LULA Acquires Zeelo’s South African Operations to Address High Commuter Costs

Transportation remains a major financial burden for South African workers.

Statistics South Africa reveals that commuting by car sets employees back an average of R2,180 ($121) monthly, while taxis are a slightly cheaper option at R960 ($53).

LULA Grows by Acquiring Zeelo’s South African Operations

Platforms like LULA, alongside competitors such as Uber for Business and MoveInSync, offer a cost-effective solution for both employers and employees.

By acquiring Zeelo’s South African operations, LULA aims to become a dominant player in this competitive market.

LULA’s Existing Strengths and Strategic Goals

Founded in 2018 by Velani Mboweni and Xabiso Nodada, LULA currently operates in five major South African cities.

The company boasts a network of over 1,000 registered drivers and shuttle fleet operators, facilitating over 700,000 rides for more than 380 companies.

Unlike traditional ride-sharing services, LULA adopts an asset-light model.

The company partners with existing drivers and shuttle operators, earning a commission ranging between 20% and 40% for facilitating rides.

LULA views the acquisition of Zeelo’s South African operations as a springboard to achieve financial stability.

By integrating Zeelo’s revenue streams, LULA anticipates attaining a positive cash flow, enabling them to prioritize “scaling smart” over rapid expansion, as stated by Mboweni.

A Smooth Transition and Looking Ahead

Commenting on the acquisition, Sam Ryan, founder and CEO of Zeelo, acknowledged the difficulty of leaving the South African market but expressed confidence in LULA’s ability to seamlessly integrate their customers and suppliers.

This smooth transition will be crucial for maintaining user satisfaction and ensuring continued growth for the combined entity.

LULA’s acquisition of Zeelo’s South African operations is a significant development in the country’s ride-sharing industry.

With an expanded user base and a strategic financial focus, LULA is well-positioned to become a leading force in the commuter ride-sharing market, offering cost-effective and convenient transportation solutions for both businesses and employees in South Africa.

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