Uber rival Hailo quits North American business

Company cited 'astronomical marketing costs' in US and Canada

Taxi hailing app Hailo is to pull out of North America as the London-based company struggles to make a profit amid “astronomical” marketing costs.

Its co-chief executive Jay Bregman is to leave the company as well as 40 employees as the company retrenches to focus on expansion in Asia and Europe.

It blamed the "the astronomical marketing spend required to compete" for the decision to quit the US and Canada.

Launched in November 2011, Hailo is available in more than 20 cities and is funded by Union Square Ventures, Accel Partners, Wellington Partners, Atomico Ventures and Sir Richard Branson.

Hailo's business model attempts to build a community out of taxi cab drivers who support the app. While many apps focus on the customer’s functionality, Hailo claims to put more emphasis on the drivers.

 

US startup Uber, one of Hailo's competitors, has had skirmishes with taxi operators and local authorities in many cities where it operates.

It was banned by German courts in September, after it tried to launch its new ride-sharing service UberPop - which links private drivers with passengers - saying it did not comply with German laws on the carriage of passengers.

Later, Uber said it would start its UberTaxi service - which uses regular taxi drivers to pick up rides in their down time.

Additional reporting by Reuters

Comments