LIVE
Hey, good morning and welcome to Alpha Street interviews. I have with me today, CEO of Get,
Dave Weiser. Get is a ground transportation management company and had recently announced
a SPAC merger with Rosecliffe Acquisition. Let's look into the business and the acquisition in
more detail. Dave, welcome to the interview and it's good to have you here today.
Thank you. Yeah, pleasure to meet you. Dave, first of all, tell us briefly your story
when the company was started, how it evolved and where you stand right now.
Right, so I founded the company in 2010 and we started in Israel as a ride-hailing company.
Quite quickly we became a market leader and profitable and we grow profitably since then.
But more importantly, along this journey we've been servicing many B2B clients and what we found
is that those clients have a much bigger problem that they have more than just one vendor. In
reality they have between 20 to 60 and they had no platform to manage this entire spend
across those many vendors. So we started then to develop a solution that does exactly this.
We managed to aggregate all different transportation vendors on one single platform.
So you can imagine anything from taxes to limo being on one single platform and we managed the
entire spend for companies. And once we had this unique tech, approximately around 2017,
this is when we shifted all of our resources and focus into this much bigger business model.
You can imagine that we went from being a local operator, though profitable and still fast growing,
but still local and you're familiar with the business model. We went overnight almost and we
became a software tissue that embraced the entire world and connected all different vendors
on one single platform. So the company became a global software vendor and since 2017,
this is where our focus by now more than two thirds of our business revenue is coming from
B2B. We have more than 25% of 4,500 names being our clients. So we can imagine that B2B
ground travel is our entire focus globally. Very interesting. When it comes to
ground transportation, how is the corporate side different from the consumer side from an
operational perspective? Oh, it's practically different. The problem is also radically different.
As a consumer, most of your rights happen within a certain city location and you might be fine
with just one vendor. Once you're on the company, you will end up, again, practically speaking,
you will have anywhere between 20 to 60 vendors and your problem becomes radically different.
It's not about what particular vendor is good or bad. It's about how you manage this entire
spend. So imagine you have more than one vendor and the moment you have just one more than one,
everything becomes difficult. So how do you place those orders through one system? How
you actually collect the invoice to be aggregated in one system? How you apply travel policies,
reports, analytics, and security, all different important things that are required and once you
have more than one vendor. And for corporates, I believe that this is the mantra. It's all about
standardizations and control. This mantra goes first, especially when you think of the
public company. And this is exactly the pain and this is exactly the solution to get those.
We help companies to manage and provide the standard across the entire portfolio of vendors.
I hope it's more clear now. This need different between B2C. This is all about how is my experience
and the choice and how you choose the particular vendor. There's a company that needs to run
multiple vendors and the problem is about this spend management and controls.
No, that's very clear. Just one thing that I wanted to ask you on a related note. Since a majority
of your revenues are coming from the corporate side, how do you expect the work from home hybrid
kind of work environments to actually affect the business?
Glad to ask because when you think of COVID and ground transportation, the first thing that
come to mind that is actually the industry that probably been heard by COVID and we see it from
the public reports of transportation companies and travel companies. And indeed at the beginning,
that's COVID was something that they reduced the volumes and hit every company in transport
area. But what happened actually after that is counterintuitive. The COVID situation changed the
ground transportation forever. And the reason for that is because now
a company realized that the remote workforce, that's here to stay. Companies are hiring globally
so they need to have a broader coverage. And equally important, none of the vendors that they
had in the past is reliable enough today or this way they pick up times are not as good as they
have been in the past and probably you experience it yourself, right? So what's happened is companies
now coming and say, okay, how we upgrade our, I see an infrastructure including ground transportation
so we will be able to serve our remote workforce globally better. So we need modernize and upgrade
this from this is number one, number two, and we need more of them because we're now
servicing more locations. And number three, we need some kind of aggregation
so they will provide us better pick up times and reliability because no single vendor is reliable
enough. And this is exactly what they've been doing for the last 10 years, right? And obviously
now when we see companies coming back to office, this is when they realize that the vendors,
the landscape changed and the pick up times are now not as good and they need to provide
the global coverage. This is when they also come and look for solutions like yet. And needless to
say that regardless of those changes, it's been always a big piece, a big portion of the budget
spend and companies look for savings. So we can help exactly across all of this spectrum. We
help to manage it and we also reduce the spend by almost half. And we proved to do that with many,
many companies including 1400, 500 names. So yes, it's kind of perfect timing for us,
for something that we've been working for many years.
All right, I understood. That's a very interesting perspective from your end.
Now let's just come to your SPAC merger. You have recently announced a SPAC merger with
Roscliffe Acquisition Corp, which is expected to close early next year. Tell us a bit about
the SPAC listing and how you intend to use the proceeds from the merger.
First of all, what we like about the market that we are operating is that B2B is a category that
both institutional and retail investors are like really understand and they see tremendous potential.
So it's one of those business models that people rely on and understand. Second,
as I mentioned just now, is that the time is now. The market opportunity is really happening now
because it's counterintuitive, right, is that during the COVID, it was the best time for Zoom.
But after COVID, it seems that company like GED is one of the biggest beneficiaries because
of the change that the company is coming back, they discovered the problem that
been in the past. They didn't have a platform to manage the entire spend, but now they needed
more than ever. So for us, really, the market opportunity is now and we want to go as fast as
possible. We have the first mover advantage. I mentioned that we have a large portfolio of
great companies already and it's evergreen, so we want to move as fast as possible. And SPAC was
a good solution for that. Probably the decision to become public was more important than the path
itself. And SPAC proved to be a good fit, especially given the profile of Roslith.
All right. Let's come to your financials, Deva. If you look at GED, Uber, Lyft,
all these companies were founded around the same time, like between 2010 and 2012.
While the other ride-hailing companies are struggling to make profits, you have
created a profitable business model. How did that happen?
Good question. This is where the big difference between operator and software
spend management companies get. So when you're a mobile operator, you have all of that at cost
to run the marketplace. You have an imitation because you need to spend an enormous amount of
time, effort, and people to establish that operation and to maintain this operation.
And by the way, you mentioned only ride-hailers, but obviously there are many more. As a matter of
fact, two-thirds of this $100 billion spend goes to corporate fleets and taxis, not ride-hailers.
So the market is much bigger and there are many more fleet vendors. Actually, there are tens of
thousands of them. There are many more fleet vendors than airlines. So when you look at the space,
there are many, many vendors and your question is relevant to all of them. It's difficult.
It's not impossible, but it's difficult to make money when you need to run the operational
network of your own. And by the way, we've been running our own mobility network. As I said,
when we started the company in Israel, we still have it. And it's, by the way, profitable. But it
also shows that it really takes time to become in a great shape and that you're eventually making
a profit. But you will be still limited to those specific locations where you run operation.
The big difference with what we're doing in the last five years and effectively that's what the
companies today is that we became a software teacher embracing the world. The good picture
maybe just to visualize, imagine it like the world similar to internet and telephony when you
embrace the world with the greed. So we are building the first global greed in ground transportation
and we're connecting those literally, right? It's not like we are running operation. So the
difference is that we're aggregating operators and they are those who actually execute the
transaction and our value is in running and managing it, putting the standard across and
spend management. And this is very different business model. So our revenues coming from
corporate, we proved to charge a 15% markup
for the last 10 years. So our clients actually paying us this markup, appreciating the value
we generate. As I said, it's not only about savings. So we save more than we charge. But equally
important that we provide standardization and peace of mind running this entire span and operation.
And as you can imagine, this is very different business model. So by charging corporates, we
don't have costs or limitations associated with running our own mobility network. So you can imagine
it's radically different. And are you looking to expand your operations to any new markets?
That's right.
We're expanding to new markets and after you give me a chance to talk about how we run business,
what is our business model, you can envision that for us to expand a new market is becoming
relatively simple task. Because different from operators that need to establish, invest a lot
of money, time and resources, we actually partnership, we don't compete with the different
vendors, we partner with them, right? Then we enable them to connect to the platform
and enjoy the corporate demand at the full price. We pay them full price, so with two partners.
And this business model resonates with them. So to prove it, I will tell you that by now we just
made an announcement that we're already aggregating more than 2,000 different vendors, 2,000.
And by the way, when we announced this back, we've been aggregating 1,700. So now it's 2,000.
So you can see the speed of aggregation and growth. And again, there isn't why our partners,
partner vendors connecting to the B2B marketplace that we created is because again,
they get a good high quality demand at full price. So for them, we are, as I can say, it's a free
acquisition channel. They got those users, it's like zero-cac, three-channel, three-sales force,
if you would. So it makes sense. And again, it's probably explained the scale of operation today
and why that many connected to our platform. It's important for me to explain it to answer
your question like how we expand in new markets. Once you understand that this is the business model,
we come and we offer partnership and we rely on operators in new country. You can imagine that
expansion become something that is very fast and easy to execute. And that's why at the beginning
of the interview I mentioned, imagine we embrace the world with the first global grid of transportation,
connecting the dots, exactly because of that. We see many fantastic vendors operating in different
locations, cities and villages, and we aggregate them all on the platform and connecting them
into one single grid. So by doing so, not only we drive value for the partners from the companies,
they would never get this demand otherwise. But we also simplify the life of our companies
that using the platform because we have all the different vendors on the single platform
and it's managed for them. And additionally, once they use the get platform, they also get
access to this global grid. So not only we manage what they already had, but we also give them access
to the global grid in addition to that. All right. And as far as I understand, you're currently
operating in Israel, the US, the UK and Russia, am I right? That's right. And we're about to launch
many more countries in Europe this year, including Germany, Spain, Italy, and France.
Just one last question. Dave, what should investors expect from get over the next two years?
I think it's a, I really believe that we are lucky to disrupt such a large industry.
Again, as validated by third party, factually, companies spend every year $101 billion on ground
transportation only. So imagine that we have fantastic product fit as proved by a large
portfolio of 4,500 companies. We also proved to save them up to 49%. So when you have a product
fit, large market, first move advantage, and a business model that give you global reach,
I think it's a, I very much hope that they become a darling for the public market and maybe
use this opportunity also to mention that even great business and great in large market is fantastic,
but not enough. Eventually it comes, it's all about fundamentals and federal pricing as well.
So I hope that when you look at the, when you look at the current pricing, forget that we decided
with the Roscliffe together to go public, you will find a material website left for public
trading. And I believe that that's the right attitude in any market, especially in today
market is to come with a view that give a public investor a material website for trading.
And maybe last piece to connect the dots, when you think of debt, I mentioned
that we do two things really great, one supply aggregation and second one spend management.
And on aggregation, if you, if you like, I mean, you must be familiar with other companies that
you can find other great B2B public companies that do those, do this in other industries.
So for example, aggregation, great names that come to mind is the trade desk and Olo, right?
They, it's like get, they just aggregate different type of supply in different industries,
but it's very much like that. And they prove this business model being super successful and
valuable, right? The trade desk and all. So when you look at this, this piece aggregation,
you can find some similarities with the, with those companies. When you look at the spend
management piece, again, the name that come across very often, both from shareholders and
investors is that it's very much like Koopa. And maybe one way to think about Koopa is that
Koopa is the spend management generalist where get is spend management specialist
in ground transportation. So again, these are two components that get us really well,
aggregation and spend management. When you look at each of them and you compare it to the companies
that doing that today successfully, I believe you will make your own conclusion, you know,
ask me about the public investors, I believe them seeing how much of the upside is left there
for public trading combined with the cross movement advantage and the fact that we actually
growing faster than the, those valuation tiers that I just mentioned. I believe
really to become a company that the public investors will like very much.
Sure. That's wonderful, Dave. Thoroughly enjoyed your news and insights. Thanks for your time.
Thank you so much. Thank you for the opportunity.
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