Richard Branson Gets Into Carpooling Ridesharing service Sidecar announced a $15 million Series B round from the Virgin co-founder and some top VC houses, including Avalon Ventures and Union Square Ventures.
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Branson participated in a $15 million investment round announced this week in the San Francisco-based ridesharing company, Sidecar. Also participating were heavyweight venture capital firms Avalon Ventures and Union Square Ventures.
Four months ago, Sidecar launched a feature in San Francisco that allows drivers to pick up multiple passengers along their route. In the first month, 13,000 people requested a shared ride with the Sidecar app, according to a blog post from Sidecar co-founder Sunil Paul. By allowing drivers to pick up multiple passengers, the cost of the ride is significantly reduced.
Sidecar will use the fresh funding to launch the carpooling option nationwide.
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Carpooling brings the cost of transportation down enough that it can be available to a large portion of the population, which is what makes it so powerful to the transportation industry, says Fred Wilson of Union Square Ventures.
"If we really want to reduce the number of cars on the road and make ridesharing a game changer in the transportation market, we need to see a model develop where anyone can be a driver whenever they want to drive and as many people as is safe and comfortable can get in the car with the driver and get where they want to go," he wrote. "I don't really see any other way that regular people who can spend a few dollars, but not tens of dollars, every day to get to work, can take advantage of ridesharing."
Other transportation innovators that are also using an Internet-powered app to connect drivers with riders include Uber and Lyft.
Rich Levandon of Avalon Ventures says the innovations in the transportation industry are just getting started. "We are still in the first inning of this multi-trillion dollar transportation market," wrote Levandon. "The next 24 months will be amazing."
The next couple of years may be amazing, but they are also likely to be full of faceoffs with regulators. As technology companies like Sidecar, Uber and Lyft change the way riders get around town -- without their own care and outside of any public transportation system -- regulators are struggling to keep rules updated and flexible. Just last week, the California Public Utilities Commission wrote letters to Sidecar, Uber and Lyft warning that the carpooling services they are offering are against state law. If one driver takes multiple passengers going the same in a single car together and allows the riders to split the fare, that apparently violates Public Utilities Code Section 5401.
Rules don't seem to be bothering Branson much -- he's focused on the bigger picture. "Transportation has been ripe for disruption for decades," said Branson to Sidecar co-founder Paul. "Technology has turned transportation on its head."
And, hey. If it's Richard Branson vs. California regulators? Our money is on Branson.