Madrid-based startup Goggo Network plans to run a fleet of self-driving taxis in Europe within five years, but it hasn’t wasted any time and money on developing the technology.
Founded by Argentinian serial entrepreneur Martin Varsavsky and former McKinsey partner Yasmine Fage, the startup recently secured €44m in backing from SoftBank, among other investors, for its plan to get self-driving cars on Europe’s roads.
But instead of competing with the likes of Google’s Waymo and Chinese-American startup Pony.ai — which are developing the actual autonomous cars — Goggo Network has made the unusual choice to instead focus on designing the regulatory rulebook.
This is partly because, according to Fage, a clear regulatory framework across Europe will be key if the continent wants to put autonomous cars or busses on the streets any time soon.
But it's also a canny business move. By pursuing this kind of policy work (or, in other words, lobbying) Goggo Network hopes it can partner up with others and side-step its way into the industry without spending billions on tech to compete with the real giants.
“Any new startup that says it has the technology for autonomous driving is either lying to you or totally out of their mind,” says Fage, who is Goggo Network’s chief operating officer as well as cofounder.
Goggo Network’s plan
In Goggo Network’s vision of the future, we will all travel around in pooled, electric, self-driving taxis with space for four, eight or more people.
With this seen as a given, the startup’s recommendation for governments is relatively simple: the industry should be regulated according to a licensing system, with each country issuing permits to three providers of self-driving taxi fleets, each lasting for three years. Without a license, companies can’t put their cars on the roads.
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Goggo Network argues that this kind of license-based system, which is inspired by the telecoms sector, would encourage investment into self-driving tech in Europe and help European companies compete against their deep-pocketed rivals abroad. With a clear framework for how to put autonomous cars on the street, the route to market would be clear.
“In Europe, we’re in this situation where now nobody’s investing because no one has billions to invest in the tech. And nobody's able to raise those billions in Europe because the investors don't see the path to profitability,” says Fage.
Designing out a monopoly
Perhaps most importantly, the plan is designed to prevent Europe’s transport system from becoming a monopoly owned entirely by a foreign company — namely Google.
When it comes to fine-tuning the tech, Google’s Waymo has recently pulled ahead of the rest. Valued at $105bn, the Google spinoff has already started ferrying passengers around in entirely self-driving taxis, albeit only in restricted testing zones.
Still, there are several startups in Europe working on self-driving car technology, such as Oxbotica, FiveAI and Wayve, but when compared to those in US and Chinese companies, they’re operating on shoe-string budgets. Trials are nowhere near the sophistication of Waymo’s driverless fleets.
“As it stands, the European players simply cannot compete so by doing nothing you favour a monopoly,” says Fage, adding that if the rules aren’t implemented soon, it will be too late. She emphasises that Goggo is not against Waymo's driverless cars being rolled out in Europe, but that the important thing is that no single firm gets a monopoly.
“The question is how do you work smartly with governments to create innovation and an ecosystem that actually makes sense and creates value? And how can we do that proactively instead of reactively.”
As for how Goggo Network fits into this picture, the hope is that it will become one of the licensed operators.
Crucially, rather than licenses being provided to single companies, Goggo’s recommendation is that businesses should be able to team up to form a consortium, with each providing different roles in running a self-driving fleet, such as the security, computer vision or hardware.
In initial conversations with governments in Spain, France and Germany, the startup says its idea has gone down well. Goggo Network says it hopes to get the system of the licences established by the end of 2021. From there, it plans to start operating self-driving taxis by 2024.
Fage says the company is already in negotiations with corporates around building a consortium, ready for when the license system begins. “These players know that if they also go with us, they will be partnering with a company backed by one of the biggest investors in the space,” she says, referring to SoftBank.
While arguably a novel approach, Goggo Network’s cofounder Martin Varsavsky has seen this kind of policy play work out well before. Before cofounding Goggo Network, he successfully founded four startups that pursued a similar strategy, focusing first on obtaining a license and then building up from there (Viatel, Jazztel, Ya.com and Eolia).
Having said that, there is a clear risk that even if governments choose to follow their plan, Goggo Network might never be afforded a license, in which case all the policy work would be for nothing. The risk certainly doesn’t phase Fage, who says that all startups carry risk and hers is no different.