Tuesday, October 9, 2018
11:00 AM - 12:30 PM
Grand Pacific Ballroom
Case Study: Fasten - Challenging Uber and Lyft with a New Business Model
Fasten, a new ridesharing start-up in Boston, entered the scene in September 2015 hoping its unique vision of transparency for both driver and passenger and strategy to keep riders’ fares low and charge drivers a flat $0.99 fee per ride as opposed to the 20-30% commission charged by its competition, would help differentiate it and gain the necessary traction in an ostensibly concentrated market between Uber and Lyft. Despite both Uber’s and Lyft’s valuations skyrocketing to $50 billion and $5.5 billion respectively, heavy investment in top notch Silicon Valley software developers and technological innovations such as autonomous vehicles, aggressive marketing strategies, and cutthroat poaching practices-all of which forced number three competitor Sidecar out by January 2016-Fasten’s leadership felt confident their 17 years of experience in Russia’s car services industry positioned them well to truly understand their customers and ultimately expand to other major cities. But with limited budgets to acquire talented and expensive platform developers, Fasten needed to ensure its core IT services could compete, and that its word-of-mouth approach to attract the essential network of drivers and passengers could get it the vital foothold it would need to grow.
Ross Graham Walker Professor of Business Administration
Harvard Business School
Krishna Palepu joined the faculty of the Harvard Business School in 1983. He is the Ross Graham Walker Professor of Business Administration, and Senior Advisor to the President of Harvard University. Professor Palepu was a Senior Associate Dean at the Harvard Business School for several years, overseeing the school's research, and its global initiative.