Ride-sharing startup leaves LA due to high costs, ends up in Colorado Springs

By Wayne Heilman Updated: April 11, 2018 at 4:56 pm • Published: April 6, 2018 0
photo - Downtown Colorado Springs. Image via Google Maps.
Downtown Colorado Springs. Image via Google Maps.

Mike and Lu Beck had spent most of the $2 million they had invested in KARL Technologies when they left Los Angeles and hit the road about a year ago in a travel trailer to save on living expenses and focus on getting the network launched.

After spending nearly five months stopping in many western U.S. cities, the couple ended up in Colorado Springs, deciding last August to move the company here. KARL, which has developed an alternative ride-hailing network to Uber and Lyft, found developers to help finish its smartphone application, which was launched in November and now serves about 200 chauffeur and limousine drivers in 26 countries.

"I know that if we stayed in Los Angeles, we would run out of money and end up living in a tent instead of a trailer," Mike Beck said. "We had $200,000 left and we needed to focus that on the business. The cheapest way to live is in a trailer, so we traveled around the country until we found a place. We stopped here, and after several weeks, decided to stay."

Mike Beck came up with the idea for an independent transportation network to connect chauffeurs and limousine drivers worldwide while operating the now-closed Prestige Chauffeur Academy in Paris. He started KARL there three years ago, but he said excessive regulation by the French government slowed development of the application and hamstrung the business, prompting him and the company to move to Los Angeles two years ago.

The company landed a $600,000 investment from Chinese businessman Yu Hong Lin and began working with a team of Chinese application developers to eventually gain access to the lucrative market in China, but Beck said cultural barriers between the development team and his U.S. management team set back completion by six months. KARL eventually added developers working from Japan, Colorado Springs and Florida to finish and launch application after testing Los Angeles, Paris and Luxembourg.

The company sells its application branded with the identity of the driver or limousine service for $990; that allows passengers to book rides anywhere its customers are operating, Mike Beck said. The application handles dispatching drivers, notifying them they have a ride, processing payments, providing automated marketing and search-engine optimization in exchange for a fee ranging between 3 percent and 10 percent, he said. The application has spread quickly with little marketing by KARL and is expected to generate between $200,000 and $300,000 in revenue for the company this year.

"Our target market is fleets between five and 20 vehicles," Mike Beck said. "This system allows drivers to decide their own pricing, hours and other details of their business rather than have it dictated to them by Uber, Lyft or another service. When they drive for themselves, they don't drive for other services that sell rides because they make more money since they keep a much larger percentage of what the passenger pays."

Mike Beck said he expects the company's revenue to grow by 10 to 15 times next year and reach $85 million by 2021 as it adds more drivers and fleets; he estimates the potential U.S. market at 125,000 vehicles and said the company also is testing its network to book rides between cities on private aircraft. KARL Technologies is hosting an open house from 11 a.m.-2 p.m. April 7 at its downtown offices, 301 E. Pikes Peak Ave., for customers and businesses to learn more about the company and its services.

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Contact Wayne Heilman: 636-0234

Twitter @wayneheilman

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