LULA, a ride-hailing service for corporate commuters, has acquired the South African branch of Zeelo, a US-based staff bus-sharing startup. The financial details of the deal remain undisclosed.
LULA aims to leverage Zeelo’s network of over 18,000 riders to expand its presence in South Africa. Prior to this acquisition, Zeelo facilitated more than two million rides each year.
Zeelo, which entered the South African market in 2019 and raised $33.6 million by August 2023, is now focusing on its operations in the US, UK, and Ireland. Founder and CEO Sam Ryan acknowledged the difficulty of leaving the South African market but expressed enthusiasm about integrating customers and suppliers into the LULA platform.
Transportation is the largest work-related expense for South Africans, with workers spending an average of R2,180 ($121) on cars and R960 ($53) on taxis each month. Services like Uber for Business, MoveInSynch, and LULA help employers reduce these costs for their employees.
With the acquisition of Zeelo, LULA plans to increase its market share in South Africa. The company, which has over 1,000 registered drivers and shuttle fleet operators in five South African cities, was founded in 2018 by Velani Mboweni (CEO) and Xabiso Nodada (Head of Product). LULA has completed up to 700,000 rides for more than 380 businesses.
Unlike traditional transportation companies, LULA does not own its vehicles. Instead, it partners with individual drivers and shuttle fleet operators, similar to Bolt and Uber, and takes a commission of 20% to 40%. Mboweni believes that the revenue from the Zeelo acquisition will help LULA become cash flow positive and support further expansion.
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