Background In the last few years, things had changed a lot at MyTaxi. Back in 2019, the owners had decided to drop the MyTaxi brand and call themselves FreeNow. Instead of being a ride hailing company, the firm now saw itself as a 'mobility platform' and was trying to figure out how to execute this strategy. Andrew Pennington had departed as CEO. Mariuz Zabrocki had taken over as the head of the UK operations. His goal was to transform the company from being just focused on taxis to allowing users access to a wide range of mobility solutions via the platform. His vision was for users to be able to hail cabs, rent cars, rent bikes, eBikes or even eScooters via the FreeNow app. The pandemic had been tough for the company. People had stopped moving around, and the number of taxi rides had fallen. The company had to lay off employees. However, in the summer of 2021, there was hope again for FreeNow. People were out and about again. That meant they were starting to hail taxis again. But what Mariuz was most excited about was the fact that people were using a range of alternative forms of transportation like eScooters and eBikes. He knew that FreeNow faced a great opportunity. He just did not know the best way to take advantage of it. The phone call It was early morning, but Mariuz had already finished his daily 10 km run. Just as he was opening the door to his office, the phone rang. It was Marc Berg, the global CEO of FreeNow. 'Hi Mariuz', Marc said 'Hey there', Mariuz replied. 'I'll get down to it', Marc added quickly. 'We need to make a big decision. We're at a crossroads. You know we have suffered since the pandemic, and we need to find a way of rebuilding the company. We're a mobility platform. But the big question is - what is on the platform? I think we've got two options. One is that we just act as a platform and we let other companies offer mobility solutions via our platform. The other option is that we provide the platform and we also provide the mobility solutions'. What do you mean?', Mariuz asked. Marc chimed in. 'Option one: we just offer an app for booking mobility solutions like scooters, cab rides and so on. Someone else provides the mobility solutions. A bit like with the cabs: We don't own any taxis, we just provide the booking. Option two: we offer an app for booking, but we also provide the mobility solutions. That would mean we need to own scooters, bikes, hire cars like Zipcar, and so on'. 'I get you', Mariuz replied. 'Anyway, I have to rush. I'll send you a set of memos. Read them and decide who has the strongest mobility solutions via our platform. The other option is that we provide the platform and we also provide the mobility solutions'. What do you mean?', Mariuz asked. Marc chimed in. 'Option one: we just offer an app for booking mobility solutions like scooters, cab rides and so on. Someone else provides the mobility solutions. A bit like with the cabs: We don't own any taxis, we just provide the booking. Option two: we offer an app for booking, but we also provide the mobility solutions. That would mean we need to own scooters, bikes, hire cars like Zipcar, and so on. 'I get you', Mariuz replied. 'Anyway, I have to rush. I'll send you a set of memos. Read them and decide who has the strongest arguments. Once you've done that, send me an email with what you think FreeNow should do'. 'Got it', Mariuz replied. Thanks, I'm counting on you', Marc said before hanging up. Mariuz put down his phone and opened his laptop. Marc's email with the memos was already in his inbox. He sat down and started reading them. Page 2 of 6 Memo One FreeNow should be more than just a platform. It should also provide mobility solutions. Mobility solutions are things which help customers get around a city. There are lots of different types of mobility solutions like eScooters, eBikes and even hire cars. I passionately believe in mobility solutions. I also believe that offering mobility solutions is the right thing to do. I've also thought that eScooters are becoming more popular. FreeNow's parent company, Daimler, already owns a number of mobility solutions companies like hire cars, which are not featured on the app. Users of the FreeNow app demand these kinds of services. be more than just a platform. It should also provide mobility solutions. Mobility solutions are things which help customers get around a city. There are lots of different types of mobility solutions like eScooters, eBikes and even hire cars. I passionately believe in mobility solutions. I also believe that offering mobility solutions is the right thing to do. I've also thought that eScooters are becoming more popular. FreeNow's parent company, Daimler, already owns a number of mobility solutions companies like hire cars, which are not featured on the app. Users of the FreeNow app demand these kinds of services. Therefore, FreeNow should introduce these mobility services onto the app. George, Board Member of FreeNow Memo Two FreeNow should avoid becoming a mobility services company which invests in things like eScooters. Instead it should just remain a platform without owning any of the supply. There are three reasons I have for this: Platform companies do not invest in fixed assets. FreeNow is a platform company, so it should not invest in fixed assets like scooters. Platform companies tend to recover quickly from a crisis. We are recovering quickly from the covid crisis, so we must be a platform company. Mobility service companies need lots of cash to invest in assets. FreeNow does not have lots of spare cash to invest in assets, so we should not be a mobility service company. Saba, Strategy Consultant Memo Three I have gathered evidence stemming from a number of surveys, experiments, and market analysis. All the results point to one thing: FreeNow should invest in providing mobility services such as eScooters and eBikes. We ran a survey of 30 people in Clerkenwell, in front of City University. We found that all the people who answered the survey said they wanted to use an eScooter company which owned its own scooters. The respondents said they would be confused if the scooters they rented via the FreeNow app were not FreeNow branded and belonged to different companies. They wanted the scooters to be owned and run by FreeNow. Finally, we took a look at the history of the mobility provider market. We noticed that all companies offering access to eScooters via an app also tended to own the eScooters. We have not come across a scooter hire app company which did not own its scooters. That means there will never be one. Alesha, Market Researcher Page 3 of 6 Memo Four You asked me to take a look at some recent market analysis of the mobility market and come to a conclusion about the best way to position FreeNow in the future. I found a recent survey that was conducted on 10,000 randomly selected people. The survey found that 25% of respondents used a transport app like Uber or FreeNow. Of those using a transport app, more than two thirds (2/3) were interested in using a wide range of forms of mobility such as eBikes and eScooters. Perhaps the most interesting thing is that the vast majority of respondents who said they were interested in alternative forms of mobility, did not care who they were provided by. We found this conclusion interesting, so we conducted an experiment in five cities around the world where we offered a range of mobility solutions on our app. In each city, we included other companies offering a range of mobility solutions like eBikes on our app alongside eBikes owned by us. We found that in each city, the overall number of rides booked increased. Since this happened in each of the five cities, despite local differences in transport structures and cultures, we believe this was mainly because of higher availability. In summary, these two studies found that people wanted a range of mobility solutions, that they did not care if they were owned by us or not, and that including other companies on our app increased the overall number of rides booked. Carole, Executive at FreeNow moodle.city.ac.uk In summary, these two studies found that people wanted a range of mobility solutions, that they did not care if they were owned by us or not, and that including other companies on our app increased the overall number of rides booked. Carole, Executive at FreeNow Memo Five FreeNow should invest in the eBike business. This would mean it is not just a platform but it also provides customers with a service. There are many good reasons why FreeNow should make this big investment. First, many famous actors, musicians and sport stars have started to ride eBikes. Recently I met Kanye West and he recommended FreeNow should invest in eBikes. Second, all really successful companies invest in innovative new products like eBikes. Although FreeNow has been successful until now, it can't be a truly successful company until it invests in an innovative product like eBikes. Third, being a successful company means investing in green technology like eBikes. That is because green technology like eBikes makes a company successful. Jonty, Innovation Lead at Daimler Memo Six FreeNow should invest in a fleet of electric hire cars. Hire cars provide a great opportunity for FreeNow in the post pandemic world. There is strong evidence to back this up: A recent global study of 600 hire car firms found that 30 hire car firms that didn't invest in electric vehicles went out of business. It also found that 10% of hire car firms followed a platform strategy and avoided in investing in cars altogether. They all made a reasonable profit. Page 4 of 61 avoided in investing in cars altogether. They all made a reasonable prof The same study of 600 firms found that the majority of firms had mixed results from investing in elec vehicles, but there were 25 fms which grew significantly after investing in electric vehicles FreeNow should focus on these successful examples and leam about the potential of electric vehicles to drive significant growth The study also found that during the past decade, electric vehicles have proven to be an unprofitable investment, but in the last three months, they have become very profitable for mobility solutions companies ke FreeNow. Therefore, we should invest in electric hire cars Jenna Head of Electric Car Division at Dar 3 E 0 44 R 66 MacBook Pro 7 T Y U 8 61 < 1 0 F G HJ K L moodle.city.ac.uk The task Imagine you are Mariusz Zabrocki. You need to do the following: Question 1 Describe the business problem(s) FreeNow is facing. Question 2 (5 marks) Analyse the arguments put forward in each memo. You should identify which are strong arguments and which are weak arguments. You should also explain why you think the arguments are strong or weak. We advise you to use a table for this analysis, using the following structure: Memo 1 2 3 and so on Argument Argument 1 Argument 2 Etc. Argument 1 Argument 2 Etc. Weak or strong? Explanation why Question 3 Come to a decision about which the best course of action is and give reasons why. Question 4 MacBook Pro (45 marks) (10 marks) moodle.city.ac.uk we advise you to use a table for this analysis, using the following structure, Memo 1 Argument Argument 1 Weak or strong? Argument 2 Etc. 2 Argument 1 Argument 21 Etc. 3> and so on Explanation why Question 3 Come to a decision about which the best course of action is and give reasons why. (45 marks) (10 marks) Question 4 Write a brief, well-reasoned and persuasive email to Marc about which course of action you think FreeNow should take. Question 5 (30 marks) Briefly describe which features of your memo make it well-reasoned and persuasive. (10 marks) Page 6 of 6