James Matthews believes he has a better idea for a ridesharing mobile phone application.
Grand Rapids will find out Wednesday whether that’s true.
Matthews, a partner in YAC Social, a national Internet firm targeted at restaurants and bars headquartered in Grand Rapids, is taking on Uber and similar competitors with the launch of SteadyFare for iOS and Android. Armed with $700,000 in seed money, it took Matthews less than two months to develop the app.
Disgust is a powerful motivator. Matthews’ frustration with Uber’s surge pricing, which charges riders increased prices based on the demand for rides due to events happening in a select area, led him to apply his technology background to create apps that fill the voids he wished popular apps included.
“Ridesharing is something I really love, so I made improvements that I wish were there, and we’re giving a healthy alternative,” Matthews said.
The main difference from Uber will be SteadyFare’s steady rate for riders, which also equates to a flat-pay rate for drivers. The drivers’ pay will be 8 to 10 percent more on a regular ride per mile and per idle than existing rideshare apps, he said.
That difference will come from the rider’s ability to tip a driver, which is not allowed in other rideshare apps where drivers are told not to accept tips. The lack of tipping and lower, non-surge pay rates mean fewer drivers are active during non-surge periods.
“From a surge, drivers can make more,” Matthews said. “In ours, drivers can be tipped, and that incentivizes better service and has customers expecting a better ride.”
He also takes issue with the inability to book trips ahead of time on Uber.
“If you need a trip to the airport, or even work, I wanted to make it easier than hoping there’s someone available,” he said.
SteadyFare also will have a social mission. Matthews said he had a difficult childhood, so he’ll donate portions of the app’s revenue to the nonprofit WillPlayForFood.org.
Safety is also a priority with SteadyFare. Matthews said he knows he won’t be able to personally inspect every car and driver — as he has for the initial launch — if and when the app expands to new cities, but he did add additional background checks and has given both drivers and riders preference settings so if, for example, a female rider wants a female driver, that can be selected.
Matthews doesn’t mind if drivers use other apps in addition to SteadyFare. He knows most drivers use the apps as supplementary income or as a stop-gap job while looking for work, so staying busy is important.
“From a driver perspective, I don’t care if they still have Uber,” he said. “They can drive for both; it’s just staying busy and if that helps a driver always have rides to fill rather than sitting around doing nothing, that’s great.”
If the app works well in Grand Rapids, Matthews said SteadyFare might expand to new markets fairly quickly. Within a month or two, he’d like to see the app launch in Kalamazoo. Beyond that, he hopes to expand into similar-sized “second- and third-tier markets” that Uber has entered but other rideshare apps, like Lyft, have passed over in favor of larger cities.
He hopes to launch SteadyFare in 10 cities in the first year, and 20 to 30 cities by years two and three. Markets such as Fort Wayne, Indiana, and Fort Collins, Colorado, match his criteria.
“Grand Rapids is a perfect test for Middle America, with a diverse clientele, low cost of living and early technology adopters,” Matthews said. “If Grand Rapids does well, it will provide a strong business model. From there it depends on competitors and how customers accept us.”