Why Ride-Sharing Giants Struggle to Crack Brazil

Transcript

• [00:00] Ana: Hi everyone, welcome to Emerge Markets Today. My name is Ana Paula Picasso and we are back with a new season of the podcast 2025 and also if you are listening on Spotify you can also watch us there so we have a video there and I’ll be sharing the video on the Substack newsletter so all the links are in the description if you haven’t yet.
• [00:29] Ana: Subscribe to the newsletter there. And I have a very special episode today, kicking off the season. I’m here with fellow Brazilian, Luiz Fittipaldi. Hi, Luiz.
• [00:37] Luiz: Hello. Hello, everyone.
• [00:42] Ana: He’s the former global strategist of Bolt, ride-sharing Bolt. And we’re going to talk about Brazil. We’re going to talk about ride-sharing strategy.
• [00:58] Ana: What does and doesn’t translate in emerging markets because we have many stories about big companies totally flopping when they go to places like Brazil or any other emerging markets. So how are you today, Luis?
• [01:09] Luiz: I’m great. Really happy to be here. Thank you for the invite.
• [01:18] Ana: Yeah, I’m really glad that you made the time to come and speak to me.
• [01:26] Ana: And the reason I wanted to speak to you, because this thing of translating a business strategy from, let’s say, US or a developing country to an emerging market is very hit and miss. Something that I wrote about it, I wrote about Walmart.
• [01:47] Ana: After decades, they tried, they tried, they tried in Brazil and it’s totally flopped. And finally, they ended up exiting Brazil and selling the business. And more recently, I think just this year or last year, Starbucks almost left Brazil, but they done some restructuring. But the ride sharing is something very exciting. There’s lots of things going on. So how is the ride sharing landscape in Brazil at the moment? Who are the players? How would you describe it?
• [02:14] Luiz: Pretty much like Brazil, and it’s a similar landscape you can see for most of Latin America. It’s a duopoly. You have Uber with around 50% market share. And the second one, which is neck and neck, in Brazil would be 99. In the end, ride-hailing is a zero-sum game. It’s hard to have a sustainable business if you’re not the first or the second one.
• [03:02] Luiz: That’s why we saw companies phasing out their operations in Latin America. Cabify is one. Cabify was quite big in Spain a few years back and launched in Brazil with a more premium brand, but they were not able to continue there. There were also niche apps like Lady Driver, focused on women for women, which didn’t make it. Another player that started to get a bit more relevance in a few countries is InDrive. InDrive and Bolt in a few others were able to reach top ranks, but it’s more exception. It’s still Uber and Didi with most of it.
• [03:49] Ana: Yeah, I’ve heard that. So we have Uber and Taxi 99, which was bought. It’s not totally bought by Didi, the Chinese one, but they invested on that. And then there is these smaller incumbents and startups. Bolt is very big here in Europe. They have it here in Sweden, where I am. But what does attract a company like Bolt to Brazil? And tell me your story. How did you end up going from Brazil working for Bolt in Estonia?
• [04:38] Luiz: Yeah, it was in Estonia. Estonians would say Northern Europe, most countries would say Eastern Europe. It’s more wishful thinking than geography. What attracts most players to Brazil and Latin America is the size of the market. Transport is divided into different means: public transport, private cars, trains, ride-hailing, taxis. In Latin America and Brazil, because of infrastructure issues, the share of trips by private cars and taxis is far higher than in other countries. Add a massive population and you have a huge domestic market. That’s why many players are attracted to win in Brazil. São Paulo is one of the top five markets for Uber in the world.
• [06:03] Ana: I’m from São Paulo originally. Every time I go back, I hardly take the metro. I usually take Uber everywhere. São Paulo is not designed for pedestrians, it’s designed for cars. How did you end up moving to Estonia, and what differences did you find comparing Brazil to Europe?
• [06:46] Luiz: I’ve been working in tech for 10 years. In Latin America, many companies are regional players. I wanted to work in the big leagues. I had two options: the US or Europe. I ended up in Estonia because I wanted to work at Bolt more than I wanted to live in the country. Estonia was too cold. Minus 27 degrees in winter is hard for Latinos. The lack of sun is tough.
• [07:33] Luiz: One key difference in ride-hailing between Europe and Latin America is regulation. In Latin America, Uber and others came in cowboy style: move fast and break things. Regulators tried to stop them but often couldn’t. In Europe, if regulators say no, it’s no.
• [09:22] Luiz: Another difference is infrastructure. In Europe, especially smaller countries, you see a lot of 15-minute cities. In Estonia, if you drive two hours, you’re out of the country. In São Paulo, two hours and you’re still in the same city. And with a traffic jam, you might not even move.
• [10:47] Luiz: Public transport is easier and better in Europe, so it takes a larger share. Another factor is access to capital. It’s slower than in the US, but Europe has more capacity and higher ticket sizes. Average price per trip can be 10 to 12 times higher than in Latin America, which helps cash flow and international expansion.
• [11:42] Ana: Uber in São Paulo is cheaper than in Sweden. Payments are also a challenge. Sweden is basically cashless. Brazil is still much more cash-based. How do you overcome that?
• [12:30] Luiz: Two answers. First: allow people to pay with the methods they are used to. Second: manage payouts. Even with cash payments, you need a way for drivers to deliver money back. Sometimes you do this with partnerships with widespread chains where people can deposit cash. We did that in Nigeria and Kenya. Many countries leapfrogged traditional banking and went to digital wallets.
• [13:56] Ana: Brazil is an exception because of Pix. You don’t need a credit or debit card to pay. How do platforms integrate that?
• [14:25] Luiz: In countries with specific payment systems, fintechs and banks helped by offering seamless integration. From a global product perspective, you can’t integrate every local method yourself. Kenya and Nigeria have M-Pesa, for example.
• [16:13] Ana: If a company approached you and said, “We want to enter Brazil,” what would you tell them?
• [16:40] Luiz: Short answer: please don’t go. But if you break it, it’s worth it. Brazil is massive. If you want the big cities, you need to invest a few hundred million to have a chance. If you don’t have that, you need other ways. InDrive grew by addressing driver complaints, with a more transparent bidding model and sometimes zero commission to launch. Others focus on tier-two and tier-three cities to build brand before going big.
• [18:00] Ana: Uber Moto exists, but it’s not allowed in São Paulo. Tier-two and tier-three cities can be a path in.
• [18:56] Luiz: Two-wheelers and three-wheelers are also interesting. In Paris, moto rides can be more expensive than cars because people pay for speed. In Brazil, people often assume motos should be cheaper.
• [20:23] Luiz: Safety is a massive issue. Women-to-women platforms can work because people are willing to trade time or price for safety. Another approach is changing market dynamics, because most ride-hailing players operate similarly. InDrive changed it with bidding and different commission structures.
• [21:16] Ana: What’s next for you?
• [21:45] Luiz: After Bolt, I went to Preply, a marketplace connecting tutors with students around the world. I worked in strategy and planning for a year. Now I’m focused on education as a teacher and mentor for early-stage founders, and I do some consulting in ride-hailing. Frontier markets are still early in digitalization, with radio taxis and incumbents adapting.
• [24:25] Ana: Where can people find you?
• [24:49] Luiz: Find me on LinkedIn: Luiz Fittipaldi. My website is also Luiz Fittipaldi. Drop me a message, I’m happy to help.
• [25:00] Ana: Thank you so much, Luiz. And if you haven’t subscribed, hit subscribe wherever you’re listening. See you soon. Bye.