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The a16z Show
Outsmarting Uber: Why Bolt Wins in Europe
00:41:15
What does it take to build a global mobility company from a country of just 1.3 million people? Markus Villig, founder and CEO of Bolt, joins the show to share how he scaled from Estonia to 50+ countries, navigating early scrappy days, a near-bankruptcy from expanding too fast, and the hard-won lessons behind Bolt’s capital-efficient growth. They also discuss building in Europe vs. the U.S., competing against much better-funded rivals, and why culture and ambition matter more than regulation. Finally, Markus lays out what’s next: autonomy, robotaxis, and why the future of mobility will be a hybrid of human drivers and self-driving fleets.
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- [00:00]
Markus Villig
The mobility market in general is the least competitive in the world. Bolt is the leading shared mobility business. We operate in more than 50 countries with a mission to replace people's private cars. A lot of the taxi companies obviously saw this as a threat, and then they started blocking their drivers from joining. When I was in Serbia, I was trying to sign up the local biggest taxi company there. I realized clearly these guys are the mafia. They don't care about the customer experience whatsoever. And, and that's when we pivoted back hard into just working directly with individual drivers.
- [00:31]
Gabriel Vasquez
You have raised, I believe, around $2 billion. They raised 24 billion before IPO. Do you want to share a little bit more about what that capital efficiency taught you?
- [00:42]
Markus Villig
Constraints really force you to be innovative, force you to be efficient. When you're starting a business as a 19 year old in a small country with barely any VC ecosystem, obviously you gotta make by with being 10 or 100 times more clever than your competition.
- [00:57]
Podcast Narrator
Bolt started in Estonia, a country of just over a million people. Today it operates across more than 50 countries, competing in ride hailing, food delivery, scooters, grocery delivery, and increasingly autonomous mobility. In this conversation, Gabriel Vasquez speaks with Bolt founder and CEO Marcus Willig about scaling globally from day one, competing against much larger rivals, and why operational excellence can become a lasting competitive advantage. They also discuss AI self driving vehicles building in Europe and why Markus believes the next decade of transportation will be defined as much by execution as by technology.
- [01:39]
Gabriel Vasquez
We're here today with Markus Wilig, the founder and CEO of Bolt. Markus, welcome to the A16C Show.
- [01:44]
Markus Villig
Great to be here.
- [01:45]
Gabriel Vasquez
For those of us that haven't heard about Bolt, can you introduce what Bolt is and give us a little bit about the scale, the business?
- [01:52]
Markus Villig
Sure. Bolt is the leading shared mobility business coming from out of Europe. We operate in more than 50 countries with a mission to replace people's private cars. And we cover services as diverse as ride hailing, car rentals, scooters, electric bikes, restaurant delivery, grocery delivery. So it's quite a wide breadth of products across a massive geographic diversity.
- [02:16]
Gabriel Vasquez
Awesome. And let's get a little bit about the story of how old were you when you started the business? How did the idea came about? Where were you at that moment in time and how did everything get started? Sure.
- [02:29]
Markus Villig
I was born on a tiny island in estonia with about 30,000 people. So I was growing up there, passionate about science technology, reading up on all the science fiction literature as a kid. And I really dreamed of becoming a scientist and an entrepreneur. And then Estonia Got very lucky. So in 2003, Skype was founded there with the main product headquarters being placed in Tallinn, and my older brother was one of the early employees there. So I was about 10 years old, and I was already ambitious about getting into tech. And then seeing that journey, how Skype became one of the biggest tech success stories, not just in Europe, but around the world, gave me a lot of confidence that I want to get started in the space as quickly as possible. So as a teenager, I learned to code, started building websites for local companies to make some money and get some experience. And then I did my first startup when I was 15 years old in education tech. That was a funny experience because, I mean, I was in sort of, what, seventh, eighth grade and going to headmasters and trying to sell them, like a new system to run their schools. Eventually I realized it's very hard to make money there, especially as a kid. So I pivoted a couple of years later to looking at the next idea. And then when I was just wrapping up high school, I realized transportation is the best place to be where you can make a massive impact the next 10 years. And that's how I got into Bolt and then been doing that ever since.
- [03:46]
Gabriel Vasquez
That's awesome story. It's very interesting to hear, obviously, that you've always been into entrepreneurship at such an early age. This became one of the most competitive markets. But we did a lot of research on how you started the business, and there was this dynamic at the beginning where you were dealing with the taxi operators. And then there was this incident that happened that kind of changed your perspective and you decided to go direct with the drivers. So you want to talk a little bit more about that and how that affected at the very early innings.
- [04:16]
Markus Villig
Sure. So we always had the idea that for the network to be effective and for us to provide the best utility for customers, you got to have all the supply in the network you can so that any driver that's the nearest buy in the city can pick you up. And so at first, I had no budget to begin with. I was 19 years old. So I went on the street trying to sign up taxi drivers owned by one. And that worked for a while, but then after a couple of months, I
- [04:40]
Gabriel Vasquez
realized this was the regional pitch to the taxi driver.
- [04:43]
Markus Villig
Effectively, it was that today you're stuck under this taxi company company. You pay them a massive fee each month as a fixed fee normally, and it doesn't matter how many trips you get, you still got to pay it. So you're sort of locked up into this company, and what we're going to offer you is you can download this app, which is a much better experience, and you only pay as you go, so there's no risk for you. So you can just take this for incremental income every day. And that actually resonated quite well. But the problem was a lot of the taxi companies obviously saw this as a threat, and then they started blocking their drivers from joining. So then we had to pivot the strategy. And then what we tried to do was actually that we built a tool and we thought we can get the taxi companies to join because of the tool, but then they're going to stick around for the network. I think this is actually something One of these A16Z partners likes to explain.
- [05:25]
Gabriel Vasquez
For the tool for the exchange.
- [05:27]
Markus Villig
Yeah, exactly. So I think 100%, that was the playbook we did back in 2013, before, I think he even popularized it. But effectively what we did was we built fleet management and taxi dispatch software for local taxi companies all across Eastern Europe. So we got them onto the network. They saw it was great. Then after a while, obviously they realized, hey, we don't need these human dispatchers anymore. Let's pivot to focus on the coverage rental business. And that was a great way to get going. But after a while, I realized that it's very hard if you're limited by these external partners who are oftentimes slow moving, very legacy. They don't really care about the customer experience. And I think that the last drop in the bucket for me was when I was in Serbia. I was trying to sign up the local biggest taxi company there. I realized clearly these guys are the mafia. They don't care about the customer experience whatsoever. And that's when we pivoted back hard into just working directly with individual drivers in most markets, because that was just the only way you could actually offer a great, compelling customer value proposition.
- [06:26]
Gabriel Vasquez
So you started the business in Estonia, which is one of the largest countries in the world, but obviously it's 1.2 million people in Estonia, not a large market. You have to think immediately about expanding. And I believe that you started in Western Europe, but that was almost a very, very costly decision. So you want to talk a little bit more about that? Sure.
- [06:49]
Markus Villig
I think actually what I've observed is that most startups are having the biggest issue going from 0 to 1, and then once they've cracked it and you have product market fit, then after that the scaling is relatively easier. I think for us, it was the other way around. So the 0 to 1 in Estonia was quite simple. I mean, it was a lot of work, but it was pretty straightforward. And we got the network going in about six months and about 12 months in. We were the biggest provider of taxi trips in the whole city. But then what we really struggled with was how to scale the model. So we raised our first read round of about a million bucks. We thought that that's going to be all the money we'll ever need in the world. We were very ambitious. I mean, I was 20 years old.
- [07:23]
Gabriel Vasquez
How did you find the first investor?
- [07:25]
Markus Villig
It was actually mostly local angel investors with actually a Skype background. So that's where many of them had made their first money and then they were investing in local startups. So we thought, hey, let's try to conquer the world. Let's try to launch in about a dozen countries at once. And that was a very silly idea for two reasons. First of all, we couldn't really at first identify which were going to be the successful markets because we didn't yet know what are the characteristics that actually correlate with success. So we just wasted a lot of money going into markets where we actually we shouldn't have gone to at all. And second, even in the markets that turned out to be good markets, we just had no idea how to scale. So we were just wasting money on sort of silly tactics of how do you get drivers and then taxi companies on board and didn't work and it almost bankrupted the company in six months. So then we luckily stopped that quickly. We realized that going in parallel doesn't work. We gotta go sequentially. So let's pick one market at a time, really optimize the playbook, figure out how it works. And then it took us about 18 months of doing that one by one.
- [08:23]
Gabriel Vasquez
What was the market that you guys decided?
- [08:25]
Markus Villig
I mean, it was a big market. It was Latvia right next door.
- [08:28]
Gabriel Vasquez
Now you have two powerhouses.
- [08:30]
Markus Villig
Yes, exactly. So me and my brother, we basically worked there. I mean, we literally slept in the office for a couple of months, basically figured out the model, how to scale the city and then after a while got a playbook going and then we could really start to scale. And today we've gone from that to operating in more than 52 countries now.
- [08:46]
Gabriel Vasquez
That's amazing. And we're going to touch a little bit more about how you literally have expanded to pretty much every region in the world, having started in Estonia. But I wanted to double click on what was a pivotal moment in this industry, which was Covid during that time, I believe 85% plus of the business obviously suffer because of this pandemic. How was that for you and what are some of the lessons that you want to share with some other entrepreneurs that when you face the situation.
- [09:18]
Markus Villig
So first of all, of course it was a disaster first and foremost for our drivers because suddenly when cities went into lockdown, we lost 85% of revenue. But obviously that was happening where our drivers as well, they couldn't really make any income and the company was already fairly large by then. We were in about 25 countries or so. We, we're probably doing more than 100 million of commissions in terms of actual lower take rate revenue. So it was pretty meaningful as a drop. And we pivoted and we did two things. So first of all, we realized that food delivery was growing through the roof, as was general e commerce obviously during these lockdowns. And we launched that and we scaled it to 16 countries in about four months on the back of our existing ride hailing network. And that turned out to be quite a massive success story. We went from zero to well more than a billion of gross bookings on the food platform very rapidly. And we were able to do that because we had a couple of key components. One was we had these great operational teams all over the world and we could just effectively use them to pivot those people to work on the food business instead. And second, the hard thing about this business on the food side is creating merchants on board. But then they were so desperate to join any network to get any orders. So it was very easy for us to go and sign up tens of thousands of restaurants extremely rapidly. So that that was our wage, how we got going on the food delivery
- [10:39]
Gabriel Vasquez
side and how many countries were you operating at that point in time? And did you apply some of the same lessons where you roll it out in a few countries and then went aggressively or how was that?
- [10:48]
Markus Villig
I think we launched food in about 60% of the existing rides footprint we had at the time. And it worked out really well. But that basically sort of softened the blow a bit for the first year. But then the other thing where really that moved the needle for the company was that when these lockdowns started to end, we were much closer to the markets to understand from the politicians which cities are going to open up. And we were very aggressive. So effectively we tripled our market share that we had pre Covid to post Covid because we were just much faster at investing in the right markets exactly when they opened up on the day. So when people were coming back after months to use Ride Hailing. We were the top of mind app that they wanted to come back to. And I think there's a great saying about it that it's very hard to overtake somebody in a race when everything is smooth, but you can, you can overtake a lot of cars in a race when it's raining.
- [11:41]
Gabriel Vasquez
So that was a Sena Brazilian driver. Yeah, yeah. So let's talk a little bit about this because you know, there's a lot of debate right now when it comes to building Europe versus Silicon Valley and the differences. Obviously here at accnc, we have backed amazing founders that have been in Europe, even though we're predominantly based in Silicon Valley. And what we want is to serve as a bridge. One thing that we've noticed and kind of like the main differences is when you're building a business in the US obviously you care about a lot of different dynamics like your product go to market, but you don't have to worry about multi currency, you don't have to worry about multi jurisdiction and operating in multiple countries. That is not the case in Europe where a lot of the businesses from the get go have to deal with this complexities early on. What are the things that this multi country barrier helps you focus on in the short term and in the long
- [12:49]
Markus Villig
term, I'd say it has its pros and cons. Right. So on one hand, if you start in a country like Estonia with barely more than a million people, you have to think global from day one. So the entire tech architecture, how you design the firm, everything is already on the premise that you want to be in dozens of countries. And that's a massive advantage because you're already thinking that you have to have this great product Flywheel, where you understand what's going on on the ground and you incorporate these localizations very quickly. And that's very different than if you're starting in a massive home market like India or the US where effectively you are the customer, you think you know the market well. You don't really need to worry about these localizations that much. So I think that can be a great strength of these European companies that operate in these diverse geographies. At the same time though, when you actually then look at the arc of history in tech, in most of these consumer Internet industries, the US companies have completely dominated. And I think the reason oftentimes is that you have strong network effects and economies of scale in these type of businesses. And then the problem is you might have two equally good companies. One that starts off in Europe, one that Starts off in the US because the US market is just so homogenous, you can grow much faster. And therefore what typically happens is that by the time, you know, three or five years in the US player is going to be double the size of the European player because they've had to deal with all this complexity and then all these 27 markets at once and therefore they're oftentimes growing much lower. And then typically what happens is by that time they're double the size, they can effectively go and then just outcompete them just based on having more capital often times. And we've seen this pattern just happen time and time again and I think that you need to have a very unique set of characteristics in your business for that not to be the case. So this larger scale player just doesn't wipe you out.
- [14:38]
Gabriel Vasquez
It's very, very interesting. Let's talk a little bit about Estonia, because within Europe, Estonia is a very particular country. I think one of the highest per capita unicorns per capita in the world. Estonia has been so good for us as a firm. You know, we're investors in Skype and we were also investors in Transferwise. And one thing, when I was mapping out the countries that we were going to go spend time last year, it was very clear that Estonia was had to be a top priority for us, despite the population being so, so small compared to other countries. I'm curious from your perspective, why do you think this is the case in Estonia? What, what drove this, this and yeah, like what are some of the key ingredients that make this small but very mighty ecosystem work?
- [15:32]
Markus Villig
High level. I guess it boils down to three things. One is ambition. I think that you have this strong flywheel going in Estonia for the last 20 years of us building great tech companies. So young founders coming up, they've seen the success of companies like Skype and then Wise and us who built into the tens of billions of scale. And I think they just have this feeling it's absolutely possible to do. And their ambition of course is to even surpass everybody who came before and they're willing to work very hard to make it happen. So that's a key ingredient. Second, I think Estonia has some of the best software engineers in the world and in general that applies to Eastern Europe. When you look at where most of the successful programmers have been coming from the last 20 years, I mean there's so many great ones from the region. And then third, I'd say specifically in Estonia we have this massive benefit of being a digital first nation. Arguably Estonia is the most technology wise, advanced government in the world. We've been having online voting for more than 20 years, online taxes, et cetera, like every single government service you can do online at the tap of button. So I think we've already just grown up in this environment where consumers have extremely high expectations for digital services and we're so digitally native. So for us to build these tech companies is very natural career path.
- [16:48]
Gabriel Vasquez
And you know, you mentioned this point about recruiting because one of the key questions that sometimes people that are not familiar with Europe and, you know, let's say that you start a business in Estonia is about recruiting. So it sounded, it sounded like you started with a lot of like a great pool of talent in Estonia. How did you then expand it to continue to recruit maybe outside? And how did you prioritize those markets?
- [17:13]
Markus Villig
I'd say that there's some pools of talent which are great in Eastern Europe and others less so. Specifically in terms of software engineers. Again, I think it's one of the best places in the world to hire from. You can really find absolutely fantastic product talent there. The hard thing is to find commercial leaders because obviously we've only had our independence again since 1991. Before that, entrepreneurship was largely banned in most of these Soviet Union countries under the occupation. So we just haven't had the track record and the time to build these massive corporations where people have experience of how do you scale and how do you operate an organization with thousands of employees. So it's generally been harder for us to attract execs. But I think that's actually been getting much easier now every year because just the economies is booming in Eastern Europe and there's more companies you can recruit from.
- [18:02]
Gabriel Vasquez
Let's talk a little bit more about the point where you mentioned that you have to defend yourself against a player that has been born in Silicon Valley and obviously the name is Uber. You have raised, I believe around $2 billion. They raised 24 billion before IPO, but somehow obviously you were able to maintain the ground. And that was like a very interesting dynamic, I'm guessing, between the two companies. Do you want to share a little bit more about what that capital efficiency taught you? And if you feel that Europe should change the dynamic to maybe enable companies to raise the same amount of capital, or do you think that this is more of a strength of the European ecosystem?
- [18:48]
Markus Villig
It's a big debate really. There's pros and cons. I'd say first of all, constraints really force you to be innovative, force you to be efficient. And when you're starting a business as a 19 year old in a small country with barely any VC ecosystem around. Obviously you gotta make by with being 10 or 100 times clever, more clever than your competition, otherwise it's just not going to be competitive. And that was the situation we were in for the first few years where we were on a budget of a couple of million and they'd raised more than a billion. So it was extremely hard to go head to head. You had to be just having a frugality that's really not seen in this industry ever by any other company.
- [19:32]
Gabriel Vasquez
I guess it would be interesting to double click on some of those examples.
- [19:35]
Markus Villig
Sure, it was a lot. First, obviously what type of talent you can attract. You got to get in people where you're very clear, hey, we can't really pay you well in cash, going to make it up in equity. And you are attracting people who really are missionaries. They don't join for the money. Second, you have to be clever in how do you differentiate. So you can't just out compete them on giving more vouchers because clearly they can just always outspend you. So you have to be clever in how do you localize better. And for us, for example, a big reason we've been winning all markets in Africa is because we just understood the local customer demands much better in terms of safety, in terms of payment methods, et cetera. So these are things that you can actually compete on as a small company when your bigger competitors are focused elsewhere. So I'd say that capital efficiency was a big constraint at first, but then eventually that turned into our greatest strength. Because if you work on this unit economics for a long time, for many, many years, it's extremely hard for a large company to ever get back to that level. Because when you're small you can make these iterations, put in the foundations you need to be very cost effective. If you already have thousands of employees, then changing the mindset, changing the culture is almost imposs. So we actually, even though it took us a much longer time at first to scale, once we had the infrastructure in place, then we were able to raise money and have far superior returns on unit economics.
- [20:58]
Gabriel Vasquez
That's really, really incredible. Maybe just to close the topic between building Europe and Silicon Valley, there's a lot of discussion right now online about the regulation that happens in Europe. And I'm curious from your perspective, what are some of the things that have to change in Europe for Europe to become a powerhouse? Because clearly the talent is there, the willingness is there. One can argue the Capital is there, but what is it that has to change for Europe to be able to compete head to head with Silicon Valley?
- [21:37]
Markus Villig
Well, first of all, I think that regulation is a symptom, not the root cause. So I've yet to really meet a new entrepreneur who hasn't been able to compete with the US because of regulations. It's rather. They just often bring that up, I think sort of a red herring or an excuse. I think the much deeper issue we have is really the root causes is the cultural bit and I'd say it's more disease in Western Europe where I think just people have lost the ambition. They don't think that they can compete with the US who have this fatalism. People don't want to work hard. I think in some of these communities making money is a taboo. So I don't just think you have this sort of entrepreneurial commercial mindset in a lot of these markets that used to be there. Luckily, I think that's not the case in most of Eastern Europe. And I think that's actually why we observe that most of the new successful startups in Europe are coming from Eastern Europe or from the Nordics, which I think are still retaining a much more entrepreneurial culture.
- [22:33]
Gabriel Vasquez
It's a really, really great point. Well, now, shifting gears about the future of Bolt, you've been very vocal about autonomy and you guys just announced a massive partnership with a Chinese manufacturer. Want to touch a little bit about that and your vision when it comes to autonomy? Because it's obviously a key topic for the industry.
- [22:56]
Markus Villig
Absolutely. And I think here we might have views that are quite contrarian, but we think are going to turn out to be proven right the next couple of years. So first of all, of course, the big debate is what's going to happen on the software layer? Is it going to be commoditized or is there going to be winner take all effects where one or two companies are just going to dominate the software layer, like Waymo and Tesla. Our view clearly is that there's going to be a multitude of players because we don't really observe any of the dynamics that would normally correlate with the winner take all industry. So if you just think about it from first principles or intuitively, most people in the world can drive. You don't need to have very high intelligence. In fact, one could argue that effectively the dumbest people in the world can also drive a car pretty well. So I think the barrier or threshold of intelligence you need to drive is not that high. And then you contrast that for Example to LLMs where effectively the intelligence is unbounded. You can go from novice to Einstein level in IQ or far beyond it. And I think that you have this massive returns to just investing more and building a better model in self driving. That doesn't really apply. I think once you get to a certain level of safety and driving performance, then you will have very diminishing returns. So there doesn't seem to be this unbounded sort of ceiling that would somehow give anybody a runaway effect. So I think that's the first and really crucial point that's quite distinct from many other industries. The second one is that there's a lot of debate about there being some type of data flywheel. I think that's empirically just completely incorrect. So clearly the amount of cars and the data you collect does not at all correlate to driving performance. And obviously there's many factors that go into it, the technical architecture, the sensors you use, et cetera. But at least for the time being it's clear that sort of this bitter lesson from ML doesn't really apply in this sense. Because if you have superior architecture and the right approach, you can actually get to a commercial grade robotaxi service with a fairly small amount of data and cars if you really need to. And then lastly, I mean empirically, just when you look at what's going around the world, I think the US is very centric on itself and they don't allow Chinese players in. But actually look at China. There's a number of Chinese self driving car companies that are equally good as the US ones and they're expanding globally. And that's why we decided to partner with them to be the leader in robotaxis in Europe. Europe.
- [25:25]
Gabriel Vasquez
And you know, this is maybe just to bring that lens that you just mentioned between which is like China seems to be investing a lot in it and very aggressively expanding. How do you think about the automakers from Europe? Because obviously you have great brands there that are also trying to push there. But do you feel that how does it compare with China?
- [25:47]
Markus Villig
Well, we gotta admit, I think they've all tried, they've all failed. They don't have the right culture to build self driving software. And that's I think not just limited to Europe, but I think most of these legacy OEMs around the world. That said, I do think there's a chance that there will be new startups emerging, whether it's in the US or Europe or China that will get there. Because the barrier to entry to build self driving car Software has dropped two to three orders of magnitude over the last 15 years. So people often quote that it took way more 25 billion to get to this stage and build the software. But I mean, that happened over 15 years under completely different conditions. If you start the business today in 2026, every single line item is down by one or two orders of magnitude at least. Cost per flop is down 150 times to train the models. Data collection is down by more than 10 times. Sensor costs are down by 100 times. It used to cost you 70,000 to get a lighter, you can get it now for 500 bucks or less and so on. So effectively every single line item of building this model is significantly cheaper. So we just don't see it's a stable equilibrium where there's not going to be startups that emerge and will get there.
- [26:59]
Gabriel Vasquez
Interesting point. And just to double click here a little bit on the future, because I think you brought up a really good point, which is when you're thinking about the companies that will succeed in the next 10 to 20 years, is it the ones that go full stack and build the car and then they build a network, kind of like the Waymo, or is it where you guys are coming, where you already have the network and then leverage these new technologies and partner with the manufacturer?
- [27:29]
Markus Villig
Well, I think first of all, we gotta realize that this is a physical world business, right? So it's not a software product where you launch a new model, you roll it out and a billion people can use it in a year. There's very hard physical constraints of building these cars, getting the regulatory approvals, putting them live, operating them, and so on. And this is going to take many, many years. And reality is that time is working in our favor because we think that during this transition period, which might last 10 to 20 years in many of the markets we operate in across Europe and Africa, there's a massive value in having a hybrid network where you have autonomous vehicles and you have human drivers in the same network for a couple of reasons. First of all, the peaks and troughs in this industry can be 20x between the lowest hour of utilization, the highest hour of demand. And clearly, if you have a fixed fleet of 1,000 cars in a city, they're going to be either sitting idle or you can't service most of the demand. So you need to have this flexible supply that you can work around those peaks and troughs. So I don't think there's any way you can replicate that in the short term. And then the second thing, of course, is that there's still also geographic coverage limitations. So for the time being, these AVs are not that generalist and universal. They can drive everywhere. So they will probably be concentrated in the city centers with the best utilization and the highest safety numbers. And then you can complement that with a human network that's able to drive everywhere else.
- [28:53]
Gabriel Vasquez
Makes sense. And I would say the one piece here that I would love to get your thoughts is, you know, obviously ride hailing is just one part of the business of everything that you guys have built. There is this concept of the super app. And I'm curious how you think about Bolt within the context of the super app. Previously we had the founder of Rappi in our podcast, but it does feel that you guys have kind of like the ingredients to become that. And I'm curious how you think about that broader vision as well.
- [29:30]
Markus Villig
So I'd say that super app is an undefined term, so nobody really knows what it is. I mean, how we define it is that we think that we're very central on the mission of how do we replace the need for people to have their private cars and we build all the urban on demand services around that. And again, there's great value in having one brand where you can get your ride hailing, food delivery, groceries, scooters, bikes, car rentals, everything all in one, both as a customer value proposition, because you're building the history on that customer. You can make them recommendations, you have the payment method, et cetera. But second, also, I think there's a great business value because when you look at The P&LS of all these marketplaces, the number one line item is everything to do with vouchering in terms of demand attraction. So if you can cut that line item out because you can cross pollinate customers, use multiple products, you're just structurally going to be vastly outperforming any monoline payer in this industry. Now, that said, that doesn't mean you should just blindly try to launch all your products and all your geographies. So we're very disciplined about looking at which are the markets where we have a right to win and we have a clear path to being the number one or number two in each of the businesses. And if we don't see a path to getting there, we're not just going to launch the business at all. Because our view is that the number three position in all these marketplace businesses is worth zero. You just can't compete because you don't have the network effect on your side. So we're very disciplined where we launch each of the businesses.
- [30:59]
Gabriel Vasquez
How do you think about why there's no, you know, this loosely held concept of a super app in in the US and it does seem that is feasible in other markets outside the US Just curious how you.
- [31:12]
Markus Villig
Honestly, I don't have a great theory about it. My view just is that in many of these small geographies, players rather choose to diversify into products. So you're really focused on one geography and then you try to launch 10 products there and cross pollinate and really dominate that market. While I think in the US the market is just so massive that you can just focus on one niche and build $100 billion company there and you don't need to expand. That would be my intuition why this is happening.
- [31:44]
Gabriel Vasquez
Maybe touching a little bit more about this super app concept is you recently made an acquisition for the first time, for the first obviously year decade of the business. You grow organically. What changed about this and how do you think about the future when it comes to potential acquisitions and what are some of the things that you're looking when you do that?
- [32:09]
Markus Villig
So our strong bias is to build everything internally. We just think that generally there's little value we can get in terms of talent or technology, etc. In the core business because already our cost structure and the unit economics are superior to everybody else. So the only exceptions to that would be if we're seeing really some new novel technology or some great team for us to build a new product in the portfolio that we don't have. But we haven't done that ever in this context or the other rationale which was the first acquisition we did last year was if there's like a licensing or regulatory barrier why we can't enter a particular market. And that's the reason we acquired one of these companies in Denmark last year because honestly it has some of the worst regulation in the world. So it was impossible for us to
- [32:57]
Gabriel Vasquez
enter organically otherwise we would have another business that is. I'm a fan of it is the scooter business that you have. You guys design your own scooters, maybe talk a little bit more about that and you know what, what entails to build your own scooter. But also man, because that's kind of like the few examples of like how you guys operate full stack as well.
- [33:21]
Markus Villig
I'm a big believer in vertical integration. Just enables you to move faster, build something that's more customized and just offer a better cost structure ultimately to customers. And specifically in scooters, it was an interesting arc because we started six years ago, we first bough nine bot scooters off the shelf, regular retail ones. Horrible decision. They just weren't designed to last long. And the cost of ownership was poorly bad when you adjust for all the charging and maintenance and so on. So we very quickly pivoted. We got really, we think the best hardware design team in the industry with our own manufacturing partners in China. We have employees there and we've been able to design squirters and bikes that we think are both the best in terms of customer experience. Experience now the latest generations and they have the lowest total cost of ownership of anybody in the industry as well. And there's just no way you can't compete with that unless you spend sort of six years grinding out a lot of iterations of this hardware and then optimizing every cent,
- [34:26]
Gabriel Vasquez
maybe shifting gears a little bit. There's obviously this big topic about AI and how organizations are implementing this. It feels like Bold Bolt. It's a great organization to leverage these new capabilities either from the software building. Just curious if you have a couple of examples of how AI has helped Bolt become an even better organization.
- [34:51]
Markus Villig
Absolutely. The first two are obvious, I guess not that original, which is customer service and engineering where we've seen that we've now been able to automate more than 50% of customer care interactions with better speed and better NPS scores and always lower cost. And we think that's only going to accelerate as the models improve. And second, software engineering, where just over the last two months, I mean we've seen tremendous uplift in productivity since the new models have been coming out. And the more interesting pattern I think that's now emerging is that you can just enable non technical people to do far better data analysis or build their own custom tools for sort of effectively mini workflows that nobody else otherwise would bother to automate. So we're very excited that we think we can actually keep the total headcount of the company flat or even gradually decrease that over time as the top line is going to be compounding at a massive rate. So we're very excited that I think just our cost advantage in this industry is just going to accelerate even further because that's much harder to do for a larger public company than us.
- [35:55]
Gabriel Vasquez
Yeah, one of the most exciting areas for us is like this I think is similar to what you mentioned, is the enablement of non technical people to now go build their own custom software. And you know, that obviously increases their productivity and unlocks this side of the organization that was probably capped by the size of the engineers that you had and how they prioritize that. So it's very interesting. One question for you is like you do have a market in the US in Washington dc why not go deeper into the American market?
- [36:31]
Markus Villig
It well, first of all, the reason we, we even look at the US market is because the rides market here and the mobility market in general is the least competitive in the world. And that might be a contrarian view because I think most people here presume that hey, you already have these existing players, but the reality is when you zoom into the margins like I mean the prices have gone through the roof over the last three years. Everybody's extracting a lot of margin from customers and drivers and it's actually turned out to be the highest margin, least competitive region around the world really. So that's also the reason why we launched scooters at first in dc. We're having great traction, our thesis is getting proven there and we think that there might be an opportunity for new players to enter the North American market over the coming years as well.
- [37:19]
Gabriel Vasquez
What is the long term version of Bolt leading to? To your last answer.
- [37:25]
Markus Villig
I'd say that Act 1 of the Company has been building the best mobility platform in the world in the human era. And that still has plenty of room to compound for we think decades to come. But then Act 2 of the Company is going to be self driving where we want to be the leader all across Europe and Africa and hopefully in many other parts of the world. Because I think it actually fits our DNA even better than the human era. Because what I find is that most Silicon Valley companies are not that great in terms of cost, efficiency, frugality and real world operations. And that's something that's very much in our DNA. So we think once we transition into this asset heavy robotaxi era where you need to maintain them, clean them, operate them around the world, that actually suits us really well. So we're very excited. This is an opportunity for us to 100x the business going forward.
- [38:20]
Gabriel Vasquez
Love that. And maybe just the last two questions. There are a lot of 19 year old young Marcuses around the world right now that will probably hear this podcast and you know, what are, what are some of the advice that you'll give to your younger self now that you obviously have all this amazing experience having been built.
- [38:43]
Markus Villig
My recommendation always is get going. There's so many bright young people I meet who've had an idea, they've been thinking, working on it for years and never got to it I I think that it's the best time in the world to build right now, especially when the barriers to entry in in terms of building the software is lower than ever. I I think time is of the essence so I just recommend everybody to get going as soon as possible.
- [39:07]
Gabriel Vasquez
And the last question is what is what is one of the most painful lessons that you like to share with the audience that you highly recommend not to Feels like you share a couple, but I'm curious if there's one top of mind that you're like absolutely.
- [39:21]
Markus Villig
Oh, from 12 years of building the company, there's dozens of mistakes I made, but probably the root cause of most of them is hiring the wrong people. So if anything I put even more attention the next time around on making sure that the talent you get on board is the right fit. And not just in terms of of intellectual capabilities or their problem solving or work ethic, but just in terms of culture fit. So it's somebody you can trust who's accountable, you get along with them. They're ideally, they're fun to work with as well because like that's not to be underestimated over a long period of time. Having somebody that gives you energy is very important. So if I was a second time founder, I'd put even more effort on that.
- [40:04]
Gabriel Vasquez
Markus, thank you so much for coming.
- [40:07]
Markus Villig
Yeah, this was a pleasure. Thank you Care
- [40:11]
Podcast Narrator
thanks for listening to this episode of the A16Z podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or review and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts and Spotify. Follow us on X1 6Z and subscribe to our substack@a16z.substack.com thanks again for listening and I'll see you in the next episode. Episode As a reminder, the content here is for informational purposes only, should not be taken as legal, business, tax or investment advice, or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any A16Z fund. Please note that A16Z and its affiliates may also maintain investments in the companies discussed in this podcast. For more details, including a link to our investments, please see a16z.com forward slash disclosures.