Welcome to our Innovators Creating Prosperity series, spotlighting organizations across the globe that are positively impacting economic development.
The average commuter in Lagos, Africa’s most populous city, spends more than four hours a day in traffic due in large part to the lack of affordable transportation options that require passengers to spend multiple hours on the roads. To escape traffic, many people resort to catching a lift from unregulated and unsafe motorcycle drivers, leading to unwarranted accidents and death in a country with a severely under-resourced healthcare system. At 28.3 deaths per 100,000 people, this practice increases the road traffic fatalities in Africa—and can further exacerbate traffic.
With the city’s population set to more than quadruple by 2100, the traffic problem is only going to worsen. Fewer places in the world are in such need of innovative transportation solutions that can reduce the burden on millions.
It was this predicament that inspired the creation of Metro Africa Xpress, or MAX, a transportation services company aiming to make mobility safe, affordable, and accessible to underserved populations in Nigeria and beyond. Since its genesis in 2015, MAX has harnessed mobile technology to create a network of more than 2,000 riders and completed more than two million motorcycle trips. And it’s not just aiming to improve the lives of its riders—the innovative company has also committed to driving financial inclusion of its drivers by providing asset financing after which they can own the motorcycles. We caught up with cofounder Adetayo Bamiduro about lessons he’s learned while building a new market for safe and affordable transportation in Nigeria.
Efosa Ojomo: Where did you get your idea? How did you know there was an opportunity?
Adetayo Bamiduro: Transportation is a key driver of any economy. In most African cities, the dearth of infrastructure and unemployment has made motorcycle-taxis a very popular means of transport. There are about 15 million commercial motorcycle-taxis that transport people within African cities today, however, 99% of operations in the sector are informal, unregulated, and manned by untrained riders. We saw an opportunity to build a company that focused on providing affordable and safe transportation to the millions of commuters across Lagos, and ultimately Africa.
EO: What was your initial target market?
AB: At the moment, our target market is the millions of people who don’t have access to safe, affordable, and reliable transportation options in Nigeria. Our ultimate goal is to take our model to other African countries to provide a similar service where safe and affordable transportation is a problem.
EO: What did your target market do/use before your innovation was available?
AB: Most commuters have no choice but to use unsafe and unregulated mass transportation services.
Theory Insight: One of the ways to identify an opportunity to target nonconsumption is to watch for workarounds. No one wants to use unsafe and unreliable products or services, but when they’re the only products available, customers have no choice.
EO: How have you raised funding, and what advice would you give others regarding fundraising?
AB: At the onset, we leveraged our existing resources, then raised funding from Angels, VCs and Corporates. It is advisable to set a fundraising goal and continue to raise the goal while your impact is very much measurable.
EO: Innovators often feel that the lack of an enabling environment in emerging markets—poor infrastructure, inadequate institutions, and little government support—is insurmountable. How are you overcoming these challenges?
AB: At MAX, we see all of these as opportunities to make a measurable and obvious impact in these markets. We are building financial and technology infrastructure to enable Africans to commute in a safe and affordable means. We are also creating well-trained professional riders, known fondly as MAX champions, who are now creditworthy and contribute to economic development. The MAX champion makes five times the minimum wage.
MAX is turning infrastructure barriers into a 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.
Theory Insight: When companies create new markets, the markets typically “pull in” many other components that help the society develop. In this case, MAX’s transportation market is pulling in driver’s licensing, credit monitoring, and other financial services into the economy.
EO: What are some major barriers to your company’s growth?
AB: Some of the barriers we have had include access to non-collateralized debt for drivers and inconsistent government policies.
EO: What can other innovators take away from your experience? Is there anything you’d do differently?
AB: Build innovations that have the potential to impact lives. 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. We have seen a gap in the transportation industry and the need for a solution, and MAX has built a system that can not only save lives, but also enable people to live a better life.