Luxury ride-hailer Wheely’s big bet on Dubai is that the region’s burgeoning demand from wealthy individuals and digital nomads will make town a chief fit for the corporate.
Wheely
Wheely, a luxury-focused competitor to ride-hailing giant Uber, is launching in Dubai as the corporate looks to reembark on a world expansion effort that was quashed by Covid in 2020.
The corporate, founded by Russian-Swiss entrepreneur Anton Chirkunov, told CNBC it is going to offer rides in the United Arab Emirates city starting Wednesday, catering mainly to wealthy clients.
As a part of its Dubai debut, Wheely will start offering users rides in BMW 5 Series cars for the primary time, a precursor to adding support for BMW’s i5 electric variant in the longer term.
That is a notable step, because the i5 is a less expensive vehicle than luxury electric SUV competitors comparable to the Mercedes-Benz EQE and the Tesla Model X.
Mercedes’ 2024 EQE EV starts at $79,650 while the 2024 BMW i5 series starts at $66,800.
Wheely didn’t at any point suggest it plans to ditch Mercedes cars anytime soon, however the move provides some insight into how the corporate is eager about the electrification of its fleets.
Dubai opportunity
Chirkunov said Wheely is targeting the Dubai market, which it has been planning on entering since 2021, because it already serves as a hub for wealthy business people emigrating from Europe, in addition to young digital nomads.
“European families and entrepreneurs have been moving to Dubai in the last five years,” Chirkunov told CNBC in an interview ahead of the launch. “It’s probably the most requested destination by our guests and our members. It sees the very best immigration of millionaires in the world.”
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Wheely’s move into Dubai will present existing ride-hailing operators in the business capital with some competition. Dubai is primarily dominated by Uber-owned Careem when it comes to the ride-hailing market.
The Middle East startup, which was bought by Uber for $3.1 billion, offers users delivery of hot meals and groceries in addition to taxi rides on its app.
Careem has faced struggles under Uber ownership.
It suffered losses of $218 million for Uber from Jan. 2, 2020, to Dec. 31, 2020, according to Uber’s 2020 annual report. Uber also sold a majority stake in Careem to the UAE’s e& for $400 million in late 2023, in part to raise money.
Wheely’s platform is tailored more toward mass market usage, nevertheless, and Chirkunov thinks his platform has a possibility to stand out. It competes in an analogous space to Blacklane, one other luxury-focused ride-hailer.
Chirkunov compares his product to more of a luxury product than a general service for consumers. He compares the Wheely brand to American Express’ high-status Centurion and Platinum membership bank cards.
Headquartered in London, Wheely is a startup that provides a car-hailing app similar to Uber, but targeted toward a high net price clientele. Fares, for instance, average around £46 ($57.72) for a 30-minute journey from Mayfair to the City of London.
Prices aren’t the one thing that is “high-end” about Wheely. The corporate provides trained chauffeurs who greet customers, collect their bags, and take other measures to make riders feel special.
Users could make specific requests to their chauffeurs on the Wheely app — for instance, having a driver collect flowers for a loved one before they get picked up.
Wheely even has its own tailor-made “chauffeur academy” program in place to train up drivers. That program already exists in London, at Syon House, the lavish home of the Duke of Northumberland.
Wheely is now replicating that model in Dubai, too.
Wheely’s standard offering provides users access to three predominant services: airport pickup trips, Wheely XL, and business class, a latest service that lets users take trips in BMW 5 cars.
Its members-only services — which users can only get access to via invitation or after 15 trips with the app inside six months — offers access to more premium tiers, including a first-class service with Mercedes-Benz S-Class vehicles that include bath towels, and an option to reserve a chauffeur for an entire day.
From Covid crash to global expansion
Wheely is making a renewed international drive in Dubai after several years of turbulence for the corporate.
Wheely had a tricky time when Covid lockdowns got here about.
“The pandemic was tough because, unlike, say, Amazon, where order volumes skyrocketed in the pandemic, for us our volumes dropped by 99%,” Chirkunov said.
Since then, nevertheless, demand has bounced back from its high-end clientele.
He says the platform recently reached operational profitability in all places except latest markets like Paris and Dubai.
Back in 2020, right before the pandemic, Chirkunov told CNBC in an interview that he was planning on raising $30 million in fresh capital to embark on expansion into the U.S.
Chirkunov, when asked whether Wheely had decided to raise additional cash, disclosed that the corporate discreetly raised a further sum of cash internally from existing shareholders.
The funding, which has not previously been disclosed, amounts to $15 million, and brings Wheely’s total money raised to date to $43 million.
Wheely’s existing shareholder base includes enterprise capital firm Concentric and AdFirst.vc, in addition to Chirkunov himself.
Wheely plans to expand its Middle East team and chauffeur network to over 1,000 in the following three to five years, the corporate told CNBC exclusively.
Wheely reported revenues of £22.5 million in its 2021 financial 12 months, according to Firms House filing.
The corporate, which stays lossmaking at a gaggle level, reported losses of £6.1 million. That was as headcount grew significantly to 221 from 157.
U.S. expansion next
The Middle East is not the only stop on Wheely’s global expansion route, though. The startup, which earlier launched services in Paris, now plans to pursue operations in the USA, Wheely’s co-founder and CEO told CNBC.
Chirkunov said that the pandemic scuppered Wheely’s short-term plans to enter the U.S. market, and so Dubai “eclipsed” the U.S. in terms of focus for the firm.
Now, though, he sees an eventual U.S. launch in his sights.
“We’ve got many North American travellers using Wheely, especially on transfers and flights,” Chirkunov said. Wheely’s app enables its chauffeur network to check on updates concerning the status of travelers’ flights in real time.
“We’re still taking a look at launching in the U.S. in some unspecified time in the future,” Chirkunov added. “The explanation we’ve not launched yet is because we have been squarely focused on Dubai.”
But eventually, Chirkunov says, “Recent York will over take London as our top market.”