In the 10 years since Uber, a ride-sharing company, launched, the personal transport industry has been revolutionised. The second wave of revolution is coming with the multitrillion-dollar trend of Environmental, Social and Governance (ESG) funds sweeping through Wall Street.
The global ride-sharing market is already huge and set for explosive growth. This market is worth $235 billion, according to Canada’s commercial banking giant, Scotiabank. But the growth is also having a negative impact on the environment because of an increase in carbon dioxide (CO2) emissions. In this context, eco-friendly ride-sharing companies are the new darlings of the global investment community.
Bolt and Uber dominate the ride-sharing market in Nigeria. But about five years ago, the niche was non-existent in the country’s tech ecosystem. Now, there are about 20 players in the e-hailing business in Nigeria.
However, a new wind of change might be blowing across the ride-sharing market. Ontario–based Facedrive, Uber’s green competitor which launched last year, has positioned to take advantage of some $30 trillion Environmental, Social and Governance (ESG) fund on Wall Street. Uber fired the first shots in the ride-sharing movement, revolutionising a hundred-year-old dynasty, with the taxi industry forced to its knees in a matter of years. Now, Facedrive Inc. looks set to lead the green revolution in ride-sharing.
ESG is a catch-all term for investing strategies that consider a company’s environmental, social and governance factors. While critics have called ESG investing vague and even fraud, analysts predict it will double in 2020 and become integrated into the investment decisions of every investor.
Currently, ESG is going through an explosive phase. Goldman Sachs started a $1.5 billion ESG fund. Jeff Bezos, founder of Amazon, just launched his $10 billion Global Earth Fund. BlackRock is looking to have over $1 trillion in ESG assets within the next decade.
Facedrive spotted this boom and is determined to ride the wave. This is why the company is making moves to take advantage of Uber’s shortcomings. It is reported to have already secured major contracts with government agencies, celebrity superstars, and global tech titans – and it has done it all with just a few years on the scene.
Facedrive claims to be a company that puts “people and planet first”. Its entire platform is supposedly built on this premise. It offers riders sustainable, conscious, and friendly service as it takes care of its drivers.
“This approach ties in perfectly to the trillion-dollar ESG trend that has captivated Wall Street,” said Jason Eckerman, an analyst at OilPrice.com.
Facedrive gives riders the choice to go electric or gas-powered without paying a premium for the option. Moreover, its innovative in-app algorithm calculates exactly how much CO2 was created on the journey, and sets aside a piece of the fare to help offset its carbon footprint.
This puts Facedrive right in the middle of two disruptive mega-trends transforming the world as we know it. On one side, it is reimagining the $8 trillion transportation business and on the other, it is tapping into Big Money’s shift into the $30 trillion world of sustainable and responsible investing.
General Motors, the auto giant, has launched a joint venture with Korea’s LG Chem to mass-produce innovative new battery cells for electric vehicles, together with investing $2.3 billion over the next few years.
Amazon is completely rethinking how its goods are delivered and investing big on the transportation of tomorrow. It is leading a $700–million investment round in EV startup Rivian and acquiring robot-taxi startup Zoox for over $1 billion.
In early July, Perpetual Limited, one of Australia’s leading asset managers, bought up Trillium Asset Management, a sustainable investment firm, for a shocking $3.3 billion.
Despite the bright sides of Facedrive’s moves, however, New York-based Hindenburg Research, a forensic financial research firm, has expressed concerns about the company’s sustainability.
“We do not think Facedrive’s core ride-hailing business is viable and we find its ‘marketing’, and related party spends to be extraordinary and alarming,” said Hindenburg Research.
