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Interview: Egija Gailuma of OX Drive

Riga has become one the first cities in Europe to get a Tesla-only premium car sharing service, thanks to the new home-grown startup OX Drive. We spoke to co-founder Egija Gailuma, who previously helped CityBee conquer the Latvian market, about OX Drive’s first months of operations, the fundraising experience, her background and passion for animal rights, and what it is like starting up out of Latvia.

Tell us about yourself. How did you end up in the startup world?

At age 11, I joined an animal shelter as a volunteer and understood that I want to help with more than just feeding and cleaning. So at age 14, I joined a political party through their youth wing. I thought that I would be able to help animals through politics but a few years later I realized that’s not how it works. I had to come up with a different plan so I could help those animals.

Meanwhile, I organized charity events like non-breed dog shows where I approached different companies and asked for support. That led me to realize that successful businesses can actually impact so much in the world. So I was sold, I felt an incredible motivation to do something on my own. 

Then I tried several things, joined start-up communities, studied at Stockholm School of Economics in Riga, created an event agency as that didn’t require any investment, joined many projects to accumulate as much experience as possible and step by step, one person led to another and eventually together with three amazing business partners that I know since my university years, we launched OX Drive.

And still, my main motivation is animal rights. Just that the goal of how to help has changed and became much bigger. 

What were you doing previous to OX Drive? What was your biggest takeaway from your previous experiences that drove you to want to start up?

Before OX Drive I built CityBee Latvia from zero to becoming the leading player in the market together with my CityBee colleagues from Lithuania.

From the time I was young, I undertook various initiatives on my own. I was training dogs for other people, I had an events agency, I had a bottled water company together with great business partners, and I worked at two other startups. So all my life I was moving towards having something cool on my own.

The biggest takeaway is to never settle for something that you are not excited about, there is always something you can do and there is always another way!

How did OX Drive come about? Who had the idea and how did the co-founders meet?

All four of us co-founders (me, Juhan Kaarma, Kristians Karlsons, Kristaps Vasiljevs) met during our studies at Stockholm School of Economics in Riga. One day I was having lunch with Juhan Kaarma and we spoke about different things, including business ideas. He was very passionate about Teslas in general so he joked that ”maybe we should do a car sharing with Teslas, that would be so cool.” So we both laughed a bit, discussed it on a high level and the next morning Juhan texted me saying ”hey, but maybe it’s really not a bad idea.” And I agreed that it’s not a bad idea at all. He was the one keeping in touch with us all separately. And he brought us all together. 

Why Tesla? Will you stick with them in the long run or include other brands of car makers?

Tesla has an extraordinary user experience and for car sharing it makes a lot of sense. It has a dash-cam that records accidents, sentry mode that records if something is happening around the car, remote control of the car, autopilot for safer driving, rare maintenance that you can even do on your own, it’s an efficient car, and it has very low depreciation.

For the foreseeable future we plan to keep using Teslas but if there will be other extraordinary and cool electric vehicles then we will definitely consider those. 

How did your idea resonate with investors? What was the fundraising experience like?

We were fundraising for approximately a year as it was not an easy task. All investors we spoke to were excited about the idea but many were sceptical as to whether there will be enough demand for it. And there is Covid and other concerns around the world that worry the investors. Many said that once we have some revenue, come again and I will be happy to invest for the expansion. Eventually we got amazing investors from Latvia, Estonia and Austria. 

Very shortly after launching, you are already seeing more demand than predicted. Who is your typical customer and what are they looking for that they can’t get from another car sharing or subscription service, or from buying a Tesla outright?

We were planning to reach people who haven’t used car sharing at all because in the existing car sharing market there are no cars that are appealing to them. And, we totally got that segment. Our average customer falls into an age group of 29-38, is tech savvy, has medium to high income, works in managerial positions or owns a business, follows the latest trends and knows what’s happening in the financial markets.

Many people also consider buying a Tesla after using our service. Thus, we are also offering, as a service, to find a Tesla for them to buy through us.

But many understand that it’s so easy using our service and that there is no need to worry about repairs, maintenance, tires, insurance, a lease and many other things linked to car ownership. 

Do you see yourselves as a car subscription, or a car sharing service? Or will you blur those boundaries?

Right now we are a pure free-floating car sharing business but we will slowly start adding subscriptions and expanding Tesla sales in our region. In the long-run you will have all the possible options with us: car sharing, subscription, lease, selling, buying and more.

In these early days, what has stood out in terms of the usage of your fleet? Are they being used for long-term or for short trips?

OX Drive cars are mostly being used for long-term trips, our average rental time is 8 hours and, in terms of distance, 82 kilometers which is almost ten times more than the average time and distance you would see at a regular car sharing company. 

Latvia, like the other Baltic nations, is a small market. What would be the next geographical steps for OX Drive, and what are you looking to learn in Latvia first?

It’s a small market but if you can make it work here then there is a high possibility it will also work in a big market. The Baltics are a good playground to test your ideas with a way smaller investment than in a big market.

We are planning to start expanding to other markets in approximately one year as we need to show investors and financiers that the business case is working and that we can make even more money outside.

Also, we are planning to expand other business units that are connected to electric vehicles, mobility and energy, thus creating an ecosystem. 

How do you assess the startup ecosystem in Latvia? Is it a good place to be based?

If we remove from the equation the fact that Latvia is a small market with less than 2 million people (700 thousand in Riga) then it is a good place in general, with a friendly and tight start-up community, start-up benefits and relatively low taxes compared to Western Europe. Almost all services are digitized and there is no need to visit places physically.

But there are also problems as in any country – the government has good ideas but then the execution process is weak and not thought-through. This can lead to confusion. Also, institutions don’t work together seamlessly, which can create chaos. 

If you could change one thing about the ecosystem for the better, what would it be?

The Latvian startup association should be handed over all the tasks related to startups. Right now, LIAA (the Latvian Investment and Development agency), is responsible also for all things related to startups but they don’t have the necessary experience and understanding of what needs to be done and how.

The startup association was created by Latvian startup owners and managers, and they are ready to take over those tasks. But the government is hesitant to do that. 

What’s next for Egija and OX Drive?

We all four want to build a successful holding company that has amazing mobility, energy and other sustainable companies that make people’s lives not only better and healthier, but also more exciting.

Personally, I also want to build a financial fund that initially invests money and then pays out to different charity organizations (animal welfare, children, the elderly, nature conservation) to cover employee salaries. These are big problems that people are ready to donate for, but for the cause, not for the salaries for the people who do the hard work.

I want to build a fund that will be self-sustainable and will help to change the whole charity scene in the region. 

What’s the best way for people to stay updated with the latest from you?

Definitely Instagram and LinkedIn.

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