Aug 25, 2015 ยท 7 minutes

It’s easy to write off Shuddle and its founder Nick Allen.

Allen was one of the co-founders of SideCar… which ultimately fared poorly enough in the ridesharing wars that it recently pivoted to deliveries. Then Allen started Shuddle, a vertical offering of Uber to ferry kids around. He isn’t a parent, prompting rivals to paint the company as everything from opportunistic to not really getting kids like a parent would.

Allen has raised a decent-- but not overly imposing-- amount of money from high quality but not overly imposing investors-- some $12 million from Accel, Forerunner, and Comcast.

And the market is getting ever more crowded with HopSkipDrive and Kidsanity in Southern California, and likely more permutations of this idea in other markets I don’t even know about. I’ve argued Care.com should go after this opportunity as a vertical. And we’d be silly to assume Uber will cede this corner of ridesharing, considering the lengths it’s willing to go to to dominate new verticals or geographies it can’t possibly win.  

The odds get worse for Shuddle the more you look at the category. It absolutely is an unmet need and a huge market that parents will pay for. But capturing that market will take walking a tightrope between safety and growth that no sharing economy company has had to face before.

Erring too much on one side could lose follow on rounds of funding, but erring too much on growth will mean you have a PR and human disaster of such epic proportions for one family that your business is toast. Anything happening to a child entrusted to the service is a million times worse than the Airbnb meth heads or Uber hammer moment. Shuddle can’t shrug and say, “Oh well, we are safer than cabs!”

I’ve expressed my concerns with this market -- conflicted as they are with my hopes someone can crack this because I think it’s good for the world if it’s safe and it works. Helping working moms be in two places at once is right up there with unlimited parental leave in terms of societal tweaks that can give women far more rights and freedoms in the work place.

As of now, my eldest child is three years away from being able to use these services. And the only one I’d consider putting the single most important thing in the world at even tiny risk for is Kidsanity-- which is little more than a Southern California pilot at this point. That’s because Kidsanity relies on an existing network of parents within a particular school or sports team or the like, and not strangers.

But, after a long conversation with Allen of Shuddle yesterday, I’m getting closer to considering it, should the company still be in business by the time Eli has various scrimmages and practices to get to.

Shuddle’s news Monday was the launch of its carpooling service just in time for back to school. This is the third way parents can use Shuddle, after pre-scheduled rides and emergency pick ups, and Allen is blunt that he hopes in a year it’s 100% of the rides.

“We have a very clear path to the economics of a ride working very well for the parents, the drivers and for us,” Allen says. “Carpooling is the answer.” It’s an aggressive push while competitors like HopSkipDrive are only now rolling out the one-off pre-scheduled pick ups. If the economics are that much better, it could give Shuddle a substantial advantage before these two or any others even meet up to actually compete in the same city.

Let’s consider each of those groups.

First off, it’s way better for parents. It allows them to set up regular carpools using existing connections with neighbors. Unlike carpooling features offered by Uber or Lyft there is no logistics algorithm putting random kids in various cars. Parents assemble their own carpools, Shuddle is simply finding a driver and facilitating what parents would do already. In the future its algorithms may point out a kid down the street is going to the same spot everyday, but parents will know exactly who is in each carpool everyday.

And carpools are cheaper-- down from a minimum $12 per ride to $8 per ride. Allen thinks he can get that as low as $5 per ride. That makes it a doable daily habit for a wide swath of working parents. “It makes it an everyday price, because it’s an everyday problem,” he says.

It’s also better in terms of safety. Four pick ups or four drop offs -- depending on whether it’s going to or from school or an activity-- essentially gives each parent another three pair of eyes.

Also, Shuddle allows parents to request having certain drivers again. They can’t guarantee it, but Allen says in practice, there are usually several drivers frequenting trips in nearby neighborhoods, so repeat drivers are pretty common.

This was a big issue I had with Shuddle competitor HopSkipDrive. If I like a driver and my kids feel comfortable with that driver, not even allowing me to request that driver again will only encourage me to try to disintermediate the service and hire them directly.

It’s also way better for drivers. This one is easy: There are a lot of far flung places in the Bay Area where Shuddle operates, and it’s challenging to stack enough rides that the money is meaningful enough to attract and keep drivers, which is crucial to keep and attract customers. More kids in a car means more money for drivers.

And finally, it’s way better for Shuddle. There’s a reason that Allen hopes carpools will become 100% of his rides in as little as a year.

Normally, I don’t hugely care if a new service is great for a venture-backed startup or not, if it’s good for the customers. But when it comes to this category, the pressure to grow and build a viable business in this high-growth, venture-crazy world we live in is at odds with continuing to emphasize safety first. These companies cannot have a minimum viable product or move fast and break things. And if one of these companies can make the economics per ride actually work without massive crazy subsidies, that may just protect that entrant from being too beholden to VCs who might get a little impatient with the whole “responsible growth” thing.

The company rushed to get this done by back to school and there are some hiccups. Right now parents can only schedule one-off carpools, they have to actually call Shuddle if they want it to be a daily thing. Not great, since that’s the behavior Allen wants to encourage. Also he admits the UI could be a lot easier. Between multiple pick ups and drop offs, it’s a lot to cram onto a phone screen.

Lastly, Shuddle itself notes that background checks-- for anyone in the industry-- still aren’t perfect and anyone who tells you otherwise is just marketing. “We are constantly strengthening it,” Allen says. “We are working with the state to upgrade their guidelines and looking at launching sometime in 2016 something that would allow parents to access the front facing camera of the driver’s phone. We already know when a driver picks up a phone and texts, we know when they are speeding.


“There are some major misconceptions out there about fingerprinting and how it thorough it is. People think Trustline and fingerprinting are the gold standard, but it can give people a false sense of security. For one thing, it’s really just limited to crimes committed in the state of California. We are always trying to do more.”

That’s honest at least.

By this time next year, Allen hopes to be in four or five other markets. And he hopes that partnerships with schools will be a conduit to build that trust. He’s been surprised how many schools have reached out to Shuddle for help facilitating carpools-- in part to shorten pick up lines.

I’m all for schools working with any of these services-- and that’s one thing I liked about Kidsanity. The more eyes at pick up and drop off, the better; the more these services are woven into existing offline communities, the better. “They have even more scrutiny than a parent to place their stamp of approval and recommend a service like us,” Allen says.

Shuddle may not yet be in direct competition with the other companies in this category I’ve spoken with, because they are all expanding slowly enough to not collide yet. But Shuddle is pulling ahead.