Interviews at The Entrepreneur Center @NVTC

Bisnow on Business: NuRide gets people together for shared rides and doesn’t charge them anything. How’s that possible?
We get money from governments and corporate sponsors. The states of Connecticut, New York, Texas, and Virginia are among our sources of funding, plus some cities like Houston. For example, Houston has the dirtiest air in the nation. It can’t build more highways, which will just make more pollution, so it needs to put its money into traffic abatement. EPA will recognize its success in that and more federal highway dollars will be made available. So we focus on places that have air quality congestion, and we can get “congestion mitigation air quality” money, a federal program that can be applied to bike paths or NuRide. Houston pays for every mile they take off the road. We record miles taken on NuRide and report them to the government. We say, “Here’s where the car trip started, here’s where it ended,” and they pay us. Houston wins because there’s no risk. The infrastructure is there, it’s not like, “Let’s build some buses and hope someone rides.” If match.com can get me a date, NuRide can get me a ride!

How do you get money from corporate sponsors?
Well, for example, XM Satellite uses us to reduce the cost of customer acquisition. They let NuRide customers cash in miles and get money off an XM radio, then XM pays us according to a formula. Green Mountain Roasters, the second biggest coffee bean roaster after Starbucks, pays us according to the number of trips taken that pass their outlets. We provide our riders a map that shows those outlets.

So, while obviously you’re doing this to make money, it also helps the environment.The goal is that traffic congestion in America is a major problem causing lots of economic loss, as well as environmental harm and damage. Probably the most efficient way to reduce traffic congestion and to clean the air is for people to share rides.

With gas prices increasing, are you seeing people more inclined to carpools?
First of all, this is not the same as a carpool, which tends to be with the same people over and over. These arrangements are much more flexible. That said, approximately 80% of cars on the road have only one person inside. Next time you’re in a traffic jam, just look around. If you could get just a small number of people to share one of those three empty seats, you could make a big difference. We give people a way that they schedule shared rides and earn reward points for every trip that they take, then they cash those reward points in. The best analogy is that NuRide is Travelocity for car trips. You can schedule one trip with one person one day, and it’s not a carpool. I can’t emphasize that enough. Traditional carpool is the same person on the same day on the same trip. With NuRide, you can ride with different people on different days, you can ride one day a week, you can ride one day a month, you can go to the ball game with it, you can go to work, you can ride anywhere you want.

It seems a little scary to just sign up online and then get into a car with a stranger.
Well, here’s something we do that’s really cool. Have you ever used eBay? Have you ever rated the other person? With NuRide we do the same thing. To get your points, you have to give the other guy you rode with a rating. This enables everyone to know if he’s a good driver, a bad driver, does he show up late, is the car dirty, things like that. So the community polices it. We’ve got about 100,000 trips that have been taken through NuRide and we’ve not had a single complaint. The community takes care of itself and we make that clear. So while we provide the incentives and the tools, the community has to self-regulate.

Certainly the idea of carpooling isn’t novel. How did you think of applying business processes to this problem?
Sitting in traffic! The way that most of the world looks at traffic is strictly through the eyes of increasing capacity, more trains, more roads, more bridges, more this, more that, but what they don’t look at is capacity utilization. Another way to look at it is data compression through the highways. If MCI has a bunch of bandwidth, a bunch of fiber cables they need to get more stuff down, they work hard on the capacity that fiber can carry. When it comes to roads, nobody focuses on increasing the capacity utilization. The focus is completely on building more capacity. That doesn’t make sense.

But it’s not so easy to increase utilization.
The reason it’s hard is that it’s hard to find just the right person to make just the right trip with the right amount of flexibility. We really want to come and go as we please, and Americans feel that it’s a God-given right to drive a car. So incentives go a long way to get people to change their behavior.

You seem to think this business is just common sense?
I never consider myself an entrepreneur, I just do what makes the most sense. In this business, I was looking around for something to do and this just seemed like a great thing to do, seemed like a great problem, nobody was paying attention to it, and I think fundamentally it’s what we need to resolve. I’m always interested in the business that’s fundamentally different and new. I like to come along and build something that’s completely new, that’s never been done before, and see if I can change the rules of the game. That to me is really exciting.

Sometimes the logical idea doesn’t make it with the consumer. How do you deal with the risk that even if this is needed, it’s hard to change people’s habits?
I don’t think there’s any risk, I really don’t, and maybe I’m wrong in that. My sister works with MCI and she comes to me and says, “How do you deal with all that risk?” and I say, “How do you deal with the risk at MCI? Tomorrow somebody could walk into your office and fire you, without any warning.” As a CEO, I know exactly when I’m going to run out of money and I know exactly all of the variables that are influencing the outcome of my business. So if anything, she’s taking more risk. I don’t consider entrepreneurs risk-takers, I consider them control-freaks.

Is that how you approach being a CEO?
I always say that a CEO has to have “business bifocals.” You have to be able to see the future, see the vision, and know you’re going to get there when nobody else does. Details really matter, and you have to combine vision with execution of detail. The combination of these two is essential to success. People who are dreamers, got big ideas, but they can’t execute on it. They can’t figure out how to get from point A to point B, and then they’ve got typos in all their letters.

Are you a stickler for grammar?
Some laugh at me when I give people grief for spelling mistakes and things like that. They say, “Well you’re supposed to be focused on business.” No I’m not! What good is vision without execution? I’ll literally go to a whiteboard for three hours and figure where the company needs to be in three years, what are the external market factors that are affecting us, and I’ll put it down. I write checks, I balance payments, I make sure our current clients are very happy, and that everything’s executed to perfect detail. And then I have to shift back again and see where we’re going to be in 6 months, where we’re going to be in 3 months, where we’re going to be in 3 years, and ask, “Are we making all the right moves now?”

So, the ability to multi-task is what you’re saying you excel at?
Have you ever seen Time Bandits? It’s kind of jumping all around, where they had the map to the universe and they were jumping all around in time. A crazy Monty Python thing. You have to focus on today, focus on a month from today, a year from today, and you have to jump to all of them and you have to constantly shift your focus. So I call it “business bifocals.”

How is DC built into your business plan?
The positive, of course, is that DC is the second worst traffic market in the United States, behind LA. The other is that it’s a lot of professional office workers, which is what we’re focusing on. The region also gives ready access to people with a lot of understanding of transportation. Our advisors include Rodney Slater, former U.S. Secretary of Transportation and John Milliken, former Secretary of Transportation for Virginia. These guys have been invaluable to understanding how transportation works, how this whole layout works, how to work with the government, and so forth.

You like advisory boards?
I think they’re critical. It’s a great idea to have your advisors beat up your business model, tell you what you’re doing right, and what you’re doing wrong, as opposed having the market do it. I think with an advisory board, you can really let your hair down, because there is no need to be worried about the economics, the short-term pain or gain. They’re just trying to give you some good long-term advice.

Do you have some sort of exit strategy?
I always think about what the potential exits are, but I don’t fret over them. I believe very much in just building something valuable and someone will buy it. I can tell you the five targets that would be likely buyers for NuRide, but that’s not something we talk about openly. We identify, move on, and we just focus on building value.

How do you go from something like Liveprint.com to this? Aren’t they completely different activities, or is there a common denominator?
I guess I’m just a ridiculous serial entrepreneur. If there’s a problem and nobody’s solving it, I see it as a great opportunity. Everybody thinks congestion is a government problem, but governments just argue over what roads are to be built.

Do you use NuRide yourself?
Not from home to the office, because not that many people are going from Great Falls to Herndon. But I definitely use it when I go into DC for business. It’s actually fun. You meet new people, and if you don’t like them, you don’t have to ride with them again and can find others. It’s really a great arrangement!  :)