“We have faced all the difficulties that a startup might encounter,” said Madiyar Toleugali, co-founder of the startup UvU.

Startup UvU has created and is actively implementing a service for the safe transportation of children. The company raised $300,000 in pre-seed investment from the venture fund MOST Ventures Fund at a valuation of $2 to $4 million. The Tech spoke with one of the project's founders about how the startup was created, the difficulties it faced along the way, and its future plans.

Tell us about the history of UvU's creation; where did your startup's journey begin?

• One of the company's co-founders, who owns a football academy, faced a problem with transporting children. He noticed that a very large number of clients' children were not participating in sports because their parents (parents - ed. note) could not drive them. They lacked time or found it inconvenient to drive, while sending them by taxi was unsafe and expensive.

• Accordingly, as an entrepreneur, he implemented a solution within his academy. It was very simple: he hired separate drivers, created a schedule and timetable, and essentially implemented a transportation system himself because there were no other solutions on the market. From 2018 to 2020, his academy was the leader in the city of Nur-Sultan, precisely because of this transportation system. 75% of the academy's clients used this service.

• For him, this turned into a separate business direction, and at the end of 2020, he decided to do something about it—either sell it or scale it further. When we met (we went to school together and were business partners), we began discussing this topic. At that time, I had experience in ride-sharing, strategic consulting, entrepreneurship, and startups. We decided to combine our efforts, scale this experience, and provide other schools and clubs with a convenient and flexible client transportation system.

What is the essence of the startup?

• The concept is to provide convenient and safe transportation, like a personal driver, but more affordable than a taxi.

• Accessibility is ensured because children can travel together, meaning parents share the cost of trips. For example, if a child travels alone in a taxi, in our case, up to four children can travel in one car. Usually, there are three children; accordingly, the trip cost is divided among three.

• It is important to note the issue of safety: because we focus on children, have fewer drivers, and use a system of pre-planned trips, we can more thoroughly vet drivers and address safety issues while controlling quality.

• Our concept is based on the idea that parents drive children. We give one group of parents the opportunity to drive their own and other children and earn money from it. For example, currently, 60,000 cars leave for schools in Nur-Sultan every morning. We can reduce this number to 30–40 thousand by grouping some neighbors together so they can travel together.

What consumer pain points does it address?

• There are several, but the key one is the time parents spend transporting their children. On average, if a parent drives themselves, it takes 2 to 4 hours a day because you have to drive to school through traffic, and then from school to work or back home. This takes a lot of time for parents.

• Second, if parents delegate transportation to someone else—such as a taxi—it is often expensive due to morning rates and so on. They are also not very safe, as you do not know which driver your child will get in the morning.

• And third, there is the issue of flexibility and convenience. You have to constantly order a taxi, meaning you do not know how long it will take to arrive, etc. Moreover, taxis do not communicate with schools, whereas we work with them directly.

Who is behind your startup? How many people are in the team?

• We have 4 co-founders on the team. Each covers four key competencies: technology, product, finance and fundraising, and marketing. As for the rest of the team, we currently have about 25 people working. Of these, eight are developers.

What is the main principle of the technology?

• We have two key technological aspects: first, to provide a fair price for drivers and clients, considering that trips are shared, and for this price to be flexible enough so clients can change their schedules.

• Our pricing model is based on the principle that the higher the demand in a specific location (a small cluster, as we call it), the cheaper the trip, because the probability of a shared ride is higher. For example, if our users split the cost between two people, we base our calculations on that.

• At the same time, the cost must be sufficient and convenient for drivers, meaning it must satisfy all drivers. Our drivers choose trips; we give drivers the opportunity to select the most suitable routes for the next day under market conditions.

• If Uber or Yandex.Taxi operates on an on-demand ride model, where they (companies - ed. note) balance supply and demand through this, in our case, we have pre-planned trips, but we still predict how many people will travel in one car to provide a fair price.

• The second aspect is up-routing. This covers everything related to building optimal routes and being able to redistribute them during the day if someone is delayed.

• Of course, behind all this stands an admin panel, an application, and an interface.

How did the pandemic affect the startup's work? Did the number of clients change?

• We launched during the decline of the pandemic, in early 2021. Of course, at certain times when schools, clubs, and sections were completely canceled, it was not very good for us. Essentially, this limited our growth, but it never lasted long. Nevertheless, during these periods, we considered moving into other segments, such as corporate transportation. But we did not have time to switch because these pandemic restrictions themselves did not last longer than two weeks. Usually, everyone returned to schools and clubs.
• We also received feedback from parents that they do not see fully remote learning as a viable option. We observe that remote learning is primarily not a question of technology allowing children to study online from home, but a question of the lifestyle of parents and children. When a child is at home all day, they socialize less, and their surroundings do not change. Consequently, this causes psychological difficulties for both the child and their parents.

What difficulties did you face when creating the startup?

• I think we encountered all the difficulties a startup can face. Besides the constant lack of money—needing to fund bonus programs for drivers and clients, support users, and refine the software—you have not yet reached sufficient turnover volume, so this burn rate hits hard. There were moments when part of the team worked without pay.

• The second point is working with suppliers. Many face this when you have a high dependence on external technology. Especially if it is not a proven technology like Google. If the API breaks or the supplier's server goes down, the service stops working. Then we had to do some things ourselves, work nights, and build things manually. Therefore, many companies that serve a large number of clients try to keep all technologies in-house or work with very proven IT service providers.

• The third is operational issues. The climatic conditions in Nur-Sultan strongly affect driver delays. Additionally, there are seasonal factors, such as the summer period, when we had to figure out how and what to substitute for school trips.

• We had many problems, but it seems we are coping and have already learned to handle them better.

Are you registered in the Astana International Financial Centre (AIFC)? What advantages does this give you?

• Yes, we are registered there; it was a requirement of the investors. The key feature is the new jurisdiction based on English law principles. I cannot comment on any other advantages at this time.

Share your development plans for the future?

Short-term goals of the startup:

1. Gaining traction abroad
2. Growth within Kazakhstan

• We have already figured out how to grow in Kazakhstan. For the new academic year, we will confidently launch in cities other than Nur-Sultan. Currently, we are targeting large markets; I will not disclose which ones yet, but we have already begun tests in the external market.

• If we talk about longer-term prospects, we see that parents will choose education for their children (schools and clubs) not based on location, but based on connectivity with UvU and quality.