Indonesian tech startup Automo offers not just bike and car rentals, but private jets and Yacht too
The marketplace, which connects customers directly to rental companies and driver services, offers both short-term and long-term rentals
Two years ago when techie Charles Lin, who was born in Taiwan and raised in Singapore, travelled to Bali along with his Indonesian fiancée to attend a friend’s wedding, he asked her to arrange a local driver so he could do some sight-seeing along the way. However, she had hard time finding a driver.
“I thought if it was difficult for a local person like her, it would definitely be far more difficult for a foreign tourist to find a local driver. So I Googled for some options, only to find that most of the vendors are no longer operational or do not have online booking capabilities,” Lin recalls.
In Indonesia, local offline vendors require the customer to do bank transfer in advance to book the car, and both parties rely only on trust that the service would be rendered and/or customers will turn up. “We went on to book a driver through a vendor expecting that our booking will be honoured and waited at the airport. But to our disappointment, the driver did not turn up and he remained uncontactable. We later came to know the vendor provided the last available car to another customer, who had already transferred the deposit. We had no option but to hire an airport taxi that cost us a fortune,” he tells me.
This bitter experience disturbed Lin for several days. He was determined to find a solution to this problem and this led him to start Automo, an online platform for tourists to find drivers or automotive rental in Indonesia.
Automo, says Lin, is designed for tourists (locals and foreigners) not just to help them find drivers or automotive rental, but also to help local vendors to sell their services digitally to a global market. The company works with local vendors in Indonesia to provide a wide range of automotive options, from a simple sedan to luxury cars like Rolls Royce and Lamborghini, as well as private jets and yacht. Motorbike rentals are also available.
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“While we do not own the fleet, we provide our partner vendors a simple platform to accept online bookings from customers from across the world. At the same time, we provide a world-wide audience access to vendors throughout Indonesia that did not have online system and/or English competence,” he explains the benefits of the platform.
Currently, Automo offers both short-term and long-term rentals. Lin says while the demand for high-end vehicles is not as high as the popular budget-friendly cars, he sees a potential in the corporate sector and wedding industry.
He says the company is still in talks with various yacht providers in the country to work out the best ways to sell their package, as some vendors prefer to include guided tours while some are able to lease yacht for private routes.
Lin started the company in mid-2018, along with one of his former colleagues. Lin previously worked for different technology companies in Singapore. Automo’s current management team includes two Indonesian angel investors, who have experience in setting up traditional businesses but are now interested in the tech industry.
Automo was originally started in Singapore, where the platform was built. Lin says he chose Singapore to build the platform and gather feedback from local car rental services so he could use the experience and knowledge when moving the base to Indonesia.
Growing market
The startup pins hopes on the increasing number of people moving between cities in Indonesia, looking for work opportunities. In Lin’s view, people opt for rented vehicles to move between locations, rather than buying new ones. This presents big opportunities for the company.
“Indonesia is a car rental market with an annual revenue of US$140 million, which is expected to grow 6.5 per cent over the next five years. This does not include driver services and/or segments such as yachts and motorbikes which we strongly believe will exponentially lead to higher demand going forward,” he adds.
“Our aim by the end of 2019 is to allow private owners to lease out their own automotive to generate additional income, while also providing more options especially in places that are growing rapidly in tourism such as Komodo Island where locals own ships that can be better utilised,” he adds.
As of now, the company is focused only in Indonesia as the geography is very big and the need for private transportation is high due to an almost non-existent public transport system. “We are looking to re-enter Singapore soon once we are able to support private owners who are willing to rent out their own vehicles. We are also looking at Thailand and/or Taiwan in the next phase,” he says.
Automo employees with Co-founder Charles Lin (second from right on the back row)
As for revenues, the company takes a 10 per cent cut from vendors for all bookings made through the platform while providing them with both the customer support and platform.
Challenges galore
The biggest challenge faced by Automo while starting the company was “trust deficit” in the industry. He says that local vendors have experienced a lot of issues with partners with regard to payments. “We had to convince them that we are here for the long run and improve their businesses. Our vendors are very supportive of us and also hope that we would be able to help them improve their business as they have difficulties reaching non local customers.”
Getting the vendors updated about their new fleet additions, changes in fleet are also a challenge, he reveals.
Clearly, the offline car rental industry is huge. But does it pose a threat to companies like Automo? “We are currently the only tech platform in Indonesia specialising and focusing only on automotive rental industry. We look to partner with offline players and bring them online, instead of competing with them as we believe that both online and offline rentals industries are important in Indonesia, where e-commerce is still not as widely used compared to other developed markets,” he adds.
Automo has already received a S$30,000 (US$23,000) Startup SG Founder grant and raised a S$100,000 in angel funding. It is currently in talks with potential investors to raise an additional S$70,000 to close the round at S$200,000 (US$148,000).
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