Renault calls in administrators for ‘not financially viable’ Karhoo

Renault has closed its Karhoo mobility service after seven years. It is the second time the business has entered administration, after the first version of the company went out of business in 2016.

A blunt statement on the Karhoo website reads: “Unfortunately, the decision has been taken that the business is no longer financially viable. It has therefore become necessary to enter an administration process. Under these circumstances, regrettably, we will not be able to conclude any new contracts or fulfill our obligations under our current agreements, and our platform will no longer be able to execute rides with immediate effect. We apologise to all our customers and partners.”

Karhoo was originally launched in London as a taxi comparison site in 2016. It allowed users to see available cars from different operators and click on the one they want to book, based on price quotes, pick-up time or type of car. 

In 2016 Karhoo founder, tech entrepreneur Daniel Ishag, told Professional Driver: “Over the past 15 years, over a trillion dollars has been spent educating the consumer to use comparison websites. We’re just bringing that concept to the ground transportation sector.”

Operators, including Addison Lee, ComCab, Keen Group, GLH, iRide and eConnect Cars signed up, and the service was launched with a marketing blitz including tube ads and massive screen advertising at Waterloo station. Further launches followed in New York and Singapore.

But within four months, the company had fallen into receivership amid allegations of profligacy by the management, especially Ishag himself. Karhoo v1.0 had apparently managed to burn through $250 million in investors’ start-up funds, though Ishag claimed only $52m had been spent on marketing. The rest went on expensive offices and even a New York flat for Ishag to use. Karhoo’s 120 employees lost their jobs.

In a statement that is echoed in this week’s news, Karhoo posted a message on its website in November 2016: “It is with much regret that we have to announce that Karhoo has had to close its service and is now looking at the next steps for the business.”

Karhoo was rescured from administration in January 2017 by a company called Flit Technologies, run by Boris Pilichowski and Nicolas Andine, two former employees. RCI International, a division of Renault, immediately took a majority stake in Flit, and 

Karhoo became part of Mobilize, Renault’s mobility division, alongside dispatch systems provider iCabbi, in which Renault acquired a 75% stake in June 2018. iCabbi is unaffected by the Karhoo closure.

In a statement immediately after the RCI rescue, Pilichowski and Andine said: “There is a need in ground transportation for someone to aggregate all the independents and allow them to compete, and we are determined to make sure Karhoo fills that need. Karhoo was amazingly successful in ferrying hundreds of thousands of people around the world but lacked a corporate backer, but with RCI Bank and Services, we now have that.”

Gianluca De Ficchy, CEO of RCI Bank and Services, said: “We have created an original ecosystem bringing together taxi and ride-hailing companies and the customers or employees of large organizations. Karhoo is an integral part of our strategy to develop new automobility services with a view to becoming a benchmark player in this market.”

Under Mobilize, Karhoo changed focus from price comparison app to being a B2B mobility provider, calling itself a “a white-label mobility solutions provider” forming partnerships with rail operators, travel operators, airlines and others across Europe, and offering work to major car fleets that signed up to the service.

In April 2019, Karhoo won the prestigious European Startup Gold Prize for mobility, after it was judged to be the breakthrough innovation with the most potential to shape the mobility landscape in Europe. Pilichowski and Andine left the company in 2022.

Karhoo was still doing deals just a few weeks ago. As recently as March 2024, Karhoo added Sixt Ride to its platform. Sixt Ride provides premium transfer and chauffeur services in more than 600 destinations. 

“By integrating SIXT ride, we harness our collective capabilities to establish a Mobility-as-a-Service ecosystem, revolutionizing the manner in which individuals access and employ transportation services,” Terry Coates, who replaced Andine and Pilichowski as Karhoo’s CEO in 2022, said at the time.

Last November Karhoo also integrated FreeNow’s ride-hailing services on to its European platform, putting more than 200,000 vehicles in 150 cities at the disposal of leading travel apps and websites.

Details of the Karhoo administrator have not been published, and it remains to be seen if a further attempt will be made to sell the company as a going concern, or whether this time, the closure will be permanent.