Anya Babbitt, SPLT co-founder and CEO, describes the acquisition as a most fortunate outcome.
SPLT was established in 2014 to allow people traveling to the same destinations to connect and share rides. After the companys 2015 stint in the Techstars accelerator, it honed in on a business-to-business strategy, providing carpooling services to corporations, municipalities, and universities.
SPLTs algorithm matches people who share the same route to school or work, and then computes the fastest way to get there. Babbitt says SPLT currently has roughly 140,000 users and 20 corporate customers in the United States, Mexico, and Germany.
The mobility world got a little smaller Wednesday with Robert Bosch GmbH’s announced acquisition of Splitting Fares Inc., a Detroit-based platform developer coordinating shared commutes and facilitating peer-to-peer transactions.
After completing the Techstars program, SPLT embarked on an award tour of sorts, scoring early pilot projects with DTE Energy and Lyft. The company also beat out other Detroit startups to win a spot at Google Demo Day in the spring of 2016, and it won the $500,000 grand prize at the Accelerate Michigan Innovation Competition in the fall of 2016.
The company, which recently integrated buses and van shuttles into the service, intends to scale in other Latin American and European countries throughout 2018.
Why Would An Auto Supplier Buy A Carpooling Startup? To Avoid Getting Left Behind In Mobility Shift
It was at Google Demo Day that SPLTs deal with Bosch first began to come together, Babbitt says. A Bosch executive had been dispatched to Mountain View by the company president to find a carpooling solution for its employees in Mexico City, the most congested place on the planet.
He came up to us and expressed the need for our platform in Mexico because of all the different issues with safety, security, and congestion, she adds.
By the end of 2016, SPLT had established an office in Guadalajara after inking an employee carpooling deal with Bosch. SPLT then spent the next year-plus deploying its service across Mexico, an arrangement that eventually culminated in the acquisition deal.
Wed been working with Bosch for so long as a customer, its great to see them on the buy side, Babbitt says, adding that SPLT will now be a wholly owned, independent subsidiary of Bosch. The supplier, which has 400,000 employees worldwide, was initially interested primarily in hiring SPLT to be its in-house carpooling provider, but Babbitt says Boschs interest goes beyond its own employees. We have the same shared vision for transportation, and they were seeing the same potential for global reach and scale with other organizations.
“Connectivity will fundamentally change how we get from A to B, and in the process it will help to solve todays traffic problems,” Boschs chief executive Volkmar Denner said at the Bosch ConnectedWorld 2018 IoT conference in Berlin. “We are using it to realize our vision of emissions-free, stress-free and accident-free mobility.”
To see Bosch go from an early SPLT adopter to investor and partner in selling the companys platform across the globe has been an exhilarating ride for Babbitt.
In my opinion, Bosch is the most innovative among the Tier 1 suppliers because they have a cross-vertical, industry-transforming approach, she says. And, she points out, because Bosch is privately owned, its not subject to the same investor pressure that publicly traded companies experience. Bosch has a little more flexibility to take calculated, conservative risks, and this acquisition further indicates that Bosch isnt just a hardware company—they truly have a vision to invest in mobility platforms.
Babbitt says SPLTs entire 25-person team will be retained as part of the acquisition, and it will continue to operate offices in Detroit, Chicago, England, Germany, and Mexico. Early on, SPLT relocated from New York to the Motor City—a decision that turned out to be fruitful.
The root of the product and team took shape in Detroit, and it became a great proving ground for us, Babbitt says. I’m excited to see 2018 and beyond.
SPLT is also building a large team in Los Angeles, and it has one employee in San Francisco; Babbitt expects the California and international offices to grow in the near future.
About 140,000 commuters currently use Splitting Fares in the United States, in Mexico, and in Germany. Bosch expects to see growth “well into the double digits,” according to Markus Heyn, a member of the company’s board of management. That sounds ambitious, but data suggests it’s a realistic prediction. The number of commuters who hit the road every morning continues to rise, creating traffic jams along busy corridors. Buying Splitting Fares is part of Bosch’s ongoing effort to make cities more livable and reduce pollution.
New Bosch Division Focused on Connected Mobility
Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or [email protected] Follow @XconomyDET_AA
Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or [email protected]
Bosch employees in Mexico began using Splitting Fares before the company considered making an acquisition. After several months, they reported commuting with co-workers has the added benefit of boosting productivity. It’s an opportunity to network and share ideas in an environment that’s more laid back than work space. You can also see if Stacy’s car is as disorganized as the blasting zone she calls her desk.
Bosch establishes division for connected mobility services
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Robert Bosch is joining the wave of suppliers shifting their organizational structures to brace for massive industry changes.
At its ConnectedWorld conference in Berlin on Wednesday, the company said it was establishing a separate division named Connected Mobility Solutions, dedicated to new transportation technologies. The 600-employee global team will help Bosch capitalize on trends such as ride-hailing and car-sharing services, and includes the acquisition of carpooling startup SPLT, or Splitting Fares Inc.
Boschs new division follows efforts from other suppliers to maintain their foothold in the industry as autonomous driving and connected services hit the market. In April 2017, BorgWarner invested $10 million in Silicon Valley venture-capital fund AutoTech Ventures, and in December 2017, Delphi Automotive separated its business into two companies: Aptiv, a mobility solutions supplier, and Delphi Technologies, a powertrain supplier.
The worlds largest auto supplier said it expects connected services to become a major source of profits in the near future, as the global market for mobility and digital services is projected to grow to about $172.8 billion in the next four years, according to PwC.
“Connected driving is a growth area for Bosch,” Bosch Chairman Volkmar Denner said in a statement. “Bosch aims for significant double-digit growth with the solutions it offers.”
Under the new division, the supplier said it will further develop its current connected services, including keys that can be stored on smartphones and in-car alerts for obstacles like wrong-way drivers.
It will also incorporate SPLTs carpooling business into the range of services Bosch offers. The Detroit startup connects co-workers on their daily commutes, suggesting the optimal route for people who want to share rides to and from work. The app currently counts about 140,000 users in the U.S., Mexico and Germany. The price of the acquisition was not disclosed.
Bosch ranks No. 1 on the Automotive News list of the top 100 global suppliers, with estimated worldwide sales to automakers of $46.5 billion in 2016.
You can reach Katie Burke at [email protected] — Follow Katie on Twitter: @KatieGBurke