I am running late for the interview because I cannot find a parking spot in the Graz city center; I call Daniel Kofler (29) to inform him about my delay and ask about any insider hints he could give me. He replies in a rather harsh tone “nobody is using a car. You should be here with your bike!” My expectations for the interview are rather low.
When I finally arrive, the door is open and I follow the noise through the 212sqm office to four guys playing table soccer. Daniel offers me chocolate and advises me to wait until “we have won”.
A sporty, single-dad startup founder
Daniel is young, athletic and leaves the impression of a nice guy. Also, he comes across as restless – in fact, not only is he restless, he is also a nomad. Originally from Oberndorf in Salzburg, he moved to Tyrol at the age of three, moved to Styria in 1993 and is since 2007 “a enthusiast cyclist”. His nomad approach also applies to his professional life: He dropped out of high school, then finished an apprenticeship as physics laboratory technician. Next, he took the university admission exam and enrolled as a student in physics and environmental science in Graz.
In 2007, his daughter Amélie was born. He and his former girlfriend now share custody and his priorities have shifted, with weekends and one day of the week booked for her.
Also marketing is all about the two wheeled steed. BikeCityGuide at an indoor race with Styrian Sprint Shop.The democratisation of a cyclist’s knowledge
In 2008, he started to work for a Graz-based cycle messenger company, where he worked together with his friend Andreas Stückl, who was the main creator of the business idea Daniel later mainly executed. Andreas took part in the European Cycle Messenger Competition (ECMC) 2010 in Budapest, and during his spare time, he cycled around with a map on their handle bar. With this dysfunctional experience in a foreign city, he came up with the idea to share their urban-road-cycle-messenger-know-how with other people, thus democratising the knowledge bike couriers, who tacitly have to make their way through cities. The concept for BikeCityGuide was born.
Andreas’ girlfriend’s roommate Mihai was almost done with his computer science studies and considered the idea “basically doable”. So, Daniel and Andreas raised 1.500 euros to pay Mihai for a first Android prototype, which was done in April 2011 with pre-set routes.
The algorithm takes into account the “bike friendliest” route from A to B with a certain “hierarchy of streets”, therefore prioritising side and play streets over crossings and traffic lights. Based on their own experience in Budapest, an offline function was crucial to them since the main target group were tourists.
Ever since that prototype, everything went really fast: In 2011, they were admitted to the AplusB Centerin Graz, Science Park. In the same year, another developer, Dietmar Hofer, moved from Vienna to Graz to join their team, and he is also a shareholder today. In early 2011, together with other bike couriers, they set up the foundation Styrian Sprint Shop to foster the bike culture. Together, they started initiatives as The most beautiful bike in the city, won BCG as a sponsor and exhibited at the MAK during The Long Night of the Museums. They also organised Race around Austria as a side event. In the same year, the company’s website went online and in 2013, BikeCityGuide was officially registered as a GmbH.
Diversification with the first physical product
Currently, their main business derives from the app, which covers seven countries and 36 cities. The team’s business model entails both approaches – B2C and B2B. The app is available in the app store for free, each bike map costs 4,49 euros and has been downloaded more than 150.000 times. In the B2B section, the company offers tailored apps for institutional customers. One example is the 2013 released BikeNatureGuide app for the state of Styria with their logo and corporate design; Styria uses it for pushing bike tourism, and pays a five-digit sum for licensing it.
In early 2013, BikeCityGuide added another product to the family: Finn, a mount with which bikers can fix their smartphone on the handlebar while being navigated through the city by the app. Finn is a stylish and Austrian-produced 12-euro purchase and was “the ideal addition to the app – we now have a good mix of digital and physical products”.
The commercial success seems to confirm that: revenue jumped from 60.000 euros in 2012 to 230.000 euros in 2013. In May 2014, they already made 70% of their last year’s revenue and in addition, expanded to three new countries, making cycling easy in 47 European cities. But things were not always that rosy…
Teamspirit as business philosophy; Photo credit: BikeCityGuideHeadcounts & lunch traditions
Over the years, the startup collected some 250.000 euros in grants for the further research and development of their app. In 2012, when the grant money was slowly running dry, they had more than 13 people working in their team. Daniel had to cut back to seven team members in order to survive as a company. “This was damn un-funny,” he remembers. As a result, they came up with the B2B model. Today, the team comprises 25 people alongside three shareholders. They always cook together, which costs each employee about two to three euros, and around 19 people can have lunch. “When I think back to the early days, I am very, very happy,” Daniel raves about their team climate.
Also in 2012, the app focused on people switching their mode of transportation to bikes and received a lot of criticism from existing daily commuters like: “The way this app guides me, I would never take that route”. The function to add subjectivity through peer reviews coming up in 2014 is one attempt to get deeper into cycle routing. When looking back, “we got the functions right straight from the beginning, only the design, usability and software were incrementally improved,” Daniel sums up.
Also indoors bikes are called into action, Photo credit: BikeCityGuide“Change the way traffic works”
According to Daniel, the big vision behind BikeCityGuide is “to change the waytraffic works; even in Vienna, less than seven percent of people use their bike for transportation (compared to 23% in Graz)“. “If you come to think about it, cars are parked 23 hours per day on average. And if you go less than five kilometers door-to-door, the bike is the fastest, cheapest and healthiest means of transportation,” he explains passionately.
Naturally, smart city solutions attract interest. That’s why they found themselves in talks with the European Space Agency and several investors for the internationalisation of their product and expansion of their e-commerce business in fall 2013. When asked about the usual exit dream for app companies, he is determined “I have no interest in an exit whatsoever – we have idealistic values and were able to commercialise them. Besides, it still feels like a project for me”. Upon asking him why he thinks his company is doing so well he replies “in the first place, we created this product for us. We were situation and market oriented without really wanting it”.
Over the years, Daniel has seen quite some money flowing in and out, but his vision is clear and he seems to anticipate that “the real work is still ahead of us”. When asked about things he left behind to get to where he is today, he has a quick answer: “my spare time and my university studies”.