Smart car parking system turning into a multinational company

It is a true disaster to look for a vacant parking spot in downtown Tallinn, Moscow or Helsinki. According to an IBM research, a hectic driving in an attempt to find one in any capital city worldwide may last half hour or even a full hour, aggravating traffic jams, wasting fuel and polluting the air. P2P parking services have offered their own solution to the global parking problems. Those services are arranged as peering networks where parking spaces individual owners as well as hotels, theatres, schools, public and private parking garages may offer their available parking spots via a mobile application while the service users are in turn able to book a required parking space beforehand. Kustas Koiv, a cofounder of Barking P2P parking startup in Estonia explained Invest Foresight the specifics of this trendy business.

– How did Barking come to be?

– We noticed how much parking inventory is free and available behind barriers at the Estonian National Theatre parking lot in downtown Tallinn while street parking costs 5€ per hour. So we called up the director of the theatre and asked if he was interested in renting out the extra spaces and making more revenue. He said yes, our company was started and now they make up to 5,000€ monthly from renting out 30 spaces.

– «We» – who are «we»? Tell please how did met founders of Barking? What had been they doing before they launched startup?

“We” is founders. We had worked together before on another startup that we founded in 2012- www.bikeep.com. That was the company that brought us together.

– What’s the craziest thing to happen so far while starting your company?

– I think crazy is that we have created 4,000 new public commercial parking spots without building any parking houses or lots ourselves. PS! Tallinn had a total of 15,000 commercial parking spaces before Barking. So 30% growth with software J For Latvia it’s around 1000 spaces, Finland same, Hungary 10,000 and Ukraine also 10,000. These are rough numbers.

– So what makes off-street parking lots so difficult to work with?

One challenge is that every car park is different and needs customization to some extent.

– Explain please how Barking works. What technologies do you use in it? How do you know how much time my car spent in the parking?

– Most of our spaces are behind barriers or electric gates. We install a small modem to the gate and make it available to Drivers to open those gates and park from their phones via Barking app. So we get time stamps of when the driver started and stopped parking which we use to calculate pricing.

– How much can (on the average) the person earn per month renting out parking space?

€100-250 per month from one single space. Very location dependant.

– P2P parking apps are the newest trend in the growing parking ecosystem. But how did you manage to become an international project in such a short time?

– Our niche is to connect barriers and gates to internet. It’s our edge. Of course some say the solution is easy to replicate. It’s not really. Imagine having 10,000 car parks, 10,000 modems which need to open gates 500,000 times per day. Even if the modem fails 1% of the times, it’s 5,000 problems and angry customers every day. The modem has to be extremely industrial and reliable, otherwise you can never keep them working and offer a quality customer experience. And we’re just getting started.

– How do competitors (e.g. JustPark, Park Easier или Citifyd) impact on your business?

– The P2P parking industry is not so big to have friction today. Maybe in 5 years there might be some competition problems but for now there’s enough room for all of us.

– Are you going to collaborate with Uber automated driving car? What do you think about it?

– I think in the long run it’s reasonable to unify and consolidate car-centric services into one easy interface to ease the customer experience. Today however, Uber works on ride-sharing, we work on parking and each focuses on the most important vertical in their business.

– Your business allows discovering the parking ecosystem of many countries. You have come on Asian market this year. What differs the Asian market from European one?

– Yes we’re making first steps in Honk Kong, China. Difference is mainly problem-related. In Tallinn, Helsinki or Riga, parking is expensive and that’s a problem. In HK, they’re willing to pay but there’s just not enough room for everyone. Luckily we can address both problems.

– Describe please how are you planning address both problem – especially in HK?

– The same solution- we connect gates/barriers and bring residential parking spots to market. It does 2 things- brings more parking inventory and also enables to make pricing cheaper.

– The advantages of the P2P parking business model are obvious – reducing traffic jams and emissions into the atmosphere, saving fuel. But what are cons?

– I don’t see cons in P2P services. Optimization and effectiveness are key values and there’s no negative effects that I know of.

– You are expanding your presence in Europe and Asia. How important is the Russian market for the company?

– We see Russia as an emerging, very potential and obviously a gigantic market. There have been success stories, like the mobile parking in Moscow which was deployed during just a year or 2 and has excellent retention. But there are hurdles, too.  Everywhere else (mostly) we can use our Amazon cloud services for customer data management and Global payment mediators.  In Russia we need to have local servers, local service providers and local payment mediators. This makes expansion too expensive and our focus might be somewhere else for now.

– The real gold in extra services, Luxe’s founder Curtis Lee says, filling a tank, washing a car, performing an oil change, and electric charging. Are you planning to provide similar services?

– Not only plan. Today we already are in car wash business. Check out wwwash.com

– Ride-sharing, bike sharing, car sharing, walkability and automated vehicles – where, in your opinion, this goes? How is this going to change an automobile future of the planet?

– I believe it changes the world in a positive way but how exactly- we can only speculate. And we don’t like to speculate too much, we like to keep our focus on acquiring the next 1000 customers and make real impact today.