LULA, a ride-hailing platform catering to corporate commuters, has acquired the South African division of Zeelo, a staff bus-sharing startup originally from the US. The terms of the cash-only deal have not been disclosed.
This acquisition allows LULA to leverage Zeelo’s extensive network, which boasts over 18,000 riders, to further expand its footprint in South Africa. Prior to the acquisition, Zeelo reported completing over two million rides annually. Founded in 2019, Zeelo has raised a total of $33.6 million in funding by August 2023, but is now shifting its focus back to the US, UK, and Ireland markets.
Sam Ryan, Founder and CEO of Zeelo, described the decision to exit South Africa as difficult but necessary. “We are excited to support the transition of our customers and suppliers to the LULA platform,” he stated.
Transportation remains a significant expense for South African workers, as highlighted by the National Household Travel Survey of 2022. The survey indicated that employees spend an average of R2,180 ($121) using their cars and R960 ($53) when relying on taxis.
Platforms like Uber for Business, MoveInSynch, and LULA help employers mitigate these transportation costs for their employees. With Zeelo’s acquisition, LULA aims to strengthen its market presence, building on its existing network of over 1,000 registered drivers and shuttle fleet operators across five South African cities.
Founded in 2018 by Velani Mboweni (CEO) and Xabiso Nodada (Head of Product), LULA has facilitated around 700,000 rides for more than 380 businesses. Unlike traditional ride-hailing services, LULA does not own its vehicles; instead, it collaborates with individual drivers and shuttle fleet operators, earning a commission ranging from 20% to 40%.
Philips Babatunde