An Interview With Online Car Rental Company Savaari’s Founder And CEO, Gaurav Aggarwal

Savaari Car Rental is one of the few companies that is trying to make the rented car industry more organized and streamlined and thus standardizing it in the process. This completely benefits the end consumer since the rental industry will no longer be random and poorly organized. There are a few car rental companies which are breaking into this new web enabled arena, prominent among them being Olacabs, Carzonrent and Savaari.

The car rental business should be able to handle scale, primarily because India is a large nation and rented cars have a huge demand. Frequent travelers, businessmen and others need a quick and easy solution while on their trips. This is where the online car rental business has to shine. To understand more of the business, we will be talking to Gaurav Aggarwal, the founder and CEO of Savaari.com . He started the company in 2006 along with co-founders Mohit Khanna, Rahul Khanna and Manik Shah. Savaari’s service now spans across 60 cities  and has a network of 158 vendors.

1. What was the idea behind starting a car rental company in the online space?

It was in 2006 when I was travelling from Mumbai to Delhi and had to go to Roorkee. But I found no reliable option to book a car online sitting in Mumbai. This is when I realized the need of a reliable car rental that is available 24×7 where the customer is assured of a clean, fully functioning car and an informed courteous driver. I decided to analyze the scope of the future of car rental in India and soon I found that not only there is no standard and quality assurance in this sector but also that there are no national players. There are franchises of some western companies present but they are serving only to a niche segment. The market size was few thousand crores back then, growing at 15% each year and 97% of it was unorganized. Savaari was founded in 2006 to fill this gap. We started with an initial investment of Rs.55,000.

2. Can you give some figures in terms of adoption of the service?

It has been an exciting journey so far. The first few years were spent in getting the business and financial model right. And the model was that we can provide the quality services to our customers on a pan India basis at very reasonable prices and still make money. We have been cash flow positive since our second year. In March 2012, we have raised our series A round of funding and this money will help us create awareness about Savaari and its offering to scale and to build the right technology solution to achieve the scale.

Savaari is targeted at retail users, corporate users, and online travel agents. We currently have over 500 corporate customers which consist of SMEs, MNCs and travel partners including OTAs using the services. There have been repeat customers on the retail side and also new customers coming to Savaari through word of mouth. We are currently clocking over 7,50,000 trip kms a month and have a cumulative experience of over 1 crore trip kms.

3. Based on the adoption figures, can you give us some insights into the mindset of your audiences?

The Savaari consumer is net savvy, expects a high service level and will not compromise on quality because of higher cost, but at the same time checks on price competitiveness. Savaari is not only about providing services on a phone call, but it ensures that right from the point the customer gets in touch with Savaari to the point they get billed, they interact with Savaari and in case there is any issue, it is Savaari that takes the responsibility. Even now in all the bookings, the customer sees Savaari placard, Savaari chauffeur card, Savaari duty slip and Savaari branded newspaper and water bottles. To the end customer, Savaari is a pan India car rental company and at the back end to provide services, we have decided to aggregate local players.

Along with providing the car rental services at competitive rates, Savaari guarantees to provide both on-road and online safety for the customers. For on-road safety, it provides new, clean and well maintained cars and hire only courteous and experienced chauffeurs who are well versed with regional routes, and for online safety, the most secure industrial practices for ensuring the privacy of your information are used.

4. How are you funded? Are you planning to raise more capital to expand your services?

We started with an investment of Rs.55000, which was used in putting up the website. We then added around a lakh in  the first year. However, from then we have been cash flow positive and have been using the money for expanding the business. We raised our series A first round of 1 million USD from Inventus Capital in March 2012 and we are looking at raising series B round of funding soon.

5. Are you targeting mobile? Savaari’s competitor in this space, Olacabs has a mobile first strategy? What is your take on need for mobile apps?

Savaari has got a head start in tying up with the right vendors in different cities and offering safe reliable services to customers. When you are starting up in this space, one of the biggest challenges is to make the vendors understand the benefit of tying up with you. We were able to do it well, as we understood their pain points and were able to convince how in our business model, their pain points will be taken care of. Mobile is integral part in continuing to that strategy and you will hear more in this space soon.

6. Finally, can you give tell us about Savaari’s journey and what you have learned as an entrepreneur in this space?

The difficult part was to leave the cushy job in US to move back to India and work full time on Savaari. We have come a long way since 2006. We have proved our business and service model and now have grown to an organization of 80 persons serving customers in 60 cities across India. While we do not plan to spread geographically for the next one year, we will be adding more product/services in the coming months and focus on customer delight.

On a personal front these are my learning:
- Consumers are smart; respect them by offering your services with no hidden costs
- Always see the consumer pain and have a solution that fixes while at the same time keeping an eye on the viability of the business
- Invest in the right team as that is the biggest factor in determining success for the company
- Invest in the right technology. This can phenomenally help in achieving scale in business

Website | Savaari

3 Responses to “An Interview With Online Car Rental Company Savaari’s Founder And CEO, Gaurav Aggarwal”

  1. Raghu
    January 31, 2013 at 11:00 am #

    Great insights & learning! Thank a lot for sharing your views Gaurav!! I wish you all the very best!

  2. February 3, 2013 at 10:10 am #

    I’d like to ask if Guarav thinks Avis paid too much for Zipcars!

  3. February 18, 2014 at 4:48 pm #

    Thanky to sharing your experiances.

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