Ride-sharing app, Zūm, was growing fast—right up to this past March when US schools shut down to slow the spread of the coronavirus. Watching your market effectively vanish overnight is chilling for any chief executive. But Zūm CEO Ritu Narayan seized the moment to double down on her team’s commitment to its mission even as Zūm changed its tactics. Pulling off that kind of strategic jiu jitsu is tough but was made easier, Narayan says, by the support she received from an early investors.
When schools closed, it became even more clear that many parents depend on their kids going to school so they can work and feed or provide for their children. For us, that’s made our mission stronger than ever before.
In this final installment in the EdSurge miniseries supported by Peak State Ventures on female entrepreneurs building businesses at the intersection of learning and working, Narayan, who was recently named to Inc. magazine’s list of 100 top female founders, describes how Zūm is building during this unusual time. Zūm, which is based in Redwood City, has 50 full time employees and has raised $71 million.
EdSurge: You started Zūm in 2015 with an insight that grew directly from your experience as a working mother. Could you share that starting point and how it informs your work today?
Narayan: Our mission, if you look at broadly, is to bring equity, access and opportunity to everybody because transportation is one of the barriers for working women.
I have two children. Not having transportation to get my children safely to school put me on the verge of leaving my career. (Narayan was previously a group product manager at eBay.) It was also a barrier for my children. They couldn’t attend different school activities if I was working and couldn’t get them picked up.
You have to make so many choices just to solve this one problem called transportation. And it isn’t just “transportation”—for children, transportation has to be safe, reliable and trusted. It has to work with certainty, repeatability and consistency. That was the unique insight that I had as a woman founder and as a parent. That’s what kids really need.
Our focus on flexibility, consistency, safety and reliability has been the fabric of the company since the beginning. In the early days, if a driver dropped out or there was a problem, I would cancel whatever I was doing and drive to pick up the child. We had a standing principle in the company: No child left behind, or no child left stranded.
COVID has strengthened that mission even more. COVID made clear the gap in access that wasn’t as visible. We’ve always known that schools are an important part of daily life and important for the development of children. When schools closed, it became even more clear that many parents depend on their kids going to school so they can work and feed or provide for their children. For us, that’s made our mission stronger than ever before.
What are some of the lessons you take away from running Zūm during the altered reality of the past few months?
Public schools, actually districts, are a core infrastructure for a surprisingly lot of things for children. Along with education, they provide environmental, social and emotional learning, physical activities and daily food. They provide special education, any kind of training and programs… all of those things. This is the first time probably in a hundred years that schools have been closed for so long.
If you ask me what have you learned? I would say it's about resiliency, all across the community, not just my company. From children, to parents, teachers, administrators, all across the board and including my team. My team has done so much work. They are prepared to come back to school. They have put together a great infrastructure. They are ready. Every single person, including every driver, is very mission-driven. They feel that they are helping the community. They are helping the families. They are helping the children.
On your website, you have your Ultimate Guide to COVID-19 Student Transportation. You have a lot of resources about SEL on there, which might not have been something that people associated with transportation. Why include those?
Serving kids with specialized needs or who need individualized instruction has been part of our offering to the districts for a long time. It is a very important use case. Actually, SEL is one of the first transportation routes that are coming back to service: The students absolutely need those classes and a regular and consistent environment, and parents found it most challenging when those resources were taken away overnight from them. Our solution fits really well for them because usually these kids are commuting one at a time, or two or three at a time, in small vehicles or sedans.
What percentage of your business is back? And what do you expect the pace of returning will be?
In September, we were operating at 15 percent of business. We expect by October we’ll be somewhere around 30 percent back; by December, 50 percent and by January 100 percent back. That's our forecast and it's trending in that direction.
When the pandemic closed schools, you transformed from delivering students to school into a service that delivered essentials to students. How did that happen?
For us, it was an easy adjustment. One of the superpowers of the Zūm is the platform we have built for full-service transportation: We can automatically develop the routes with multi-stops, optimize them and build them efficiently. We also have the logistics infrastructure, namely highly-vetted drivers who really care about doing this. So instead of delivering students to schools, we delivered meals from schools to homes, with different stops. It was a very interesting—even fulfilling—change for the team.
School districts don’t have the kind of routing software that you’ve developed. How has that changed how you serve them?
We are helping all our customers as they design their back-to-school routes. Transportation is one of the biggest obstacles in getting back to school. In the post-COVID world, what should transportation look like? What should be the health guidelines? How do we make transportation safe for children and adults?
It's a very complicated problem because it ties into bell schedules and how many kids can be accommodated in a socially-distanced and safe way. Should they have a split schedule, morning and afternoon? Should different students attend on different days? Buses now have different requirements for seating children and can only be half filled. So how many kids can be transported to school? Does a school need more routes?
Our goal was to help the districts save money by avoiding having to make them deploy more busses. So far, our partnerships are working out well.
Does it mean that you're going to be taking on a bigger part of that transportation for a district?
How it has evolved is that now we do full end-to-end transportation for schools. We’re effectively redesigning the yellow school bus network system. That’s huge: In the US, there are around half a million buses that transport around 26 million kids every single day, twice a day. It's a massive, organized infrastructure that is the fabric of everyday people's lives.
But that infrastructure hasn't changed for about a hundred years even though a lot has changed in terms of technology and in how people experience the commute. Zūm aims to change that infrastructure.
We got started by taking small routes. But we realized that schools benefit the most when we take on their full transportation service.
There are three areas where schools really benefit from working with us. First, our technology enables us to optimize their bus routes. We can show them how these routes could be set up so students spend less time commuting and districts can save on transportation costs because they can send a van when there is just one or five kids who typically need a ride. It also lets users plan and manage daily routes and lets all stakeholders see the status of rides at all times.
Second: We provide different size vehicles to match the district’s needs.
And the third part of our work is to help districts make their infrastructure sustainable over time and reduce their carbon footprint. We’re just starting that work.
All together, this means that districts become much more flexible in their ability to respond to and plan for change. They don't need months. They just need hours and days to be able to respond to anything. And students get a better experience.
For instance, since March, we’ve been providing transportation to 1,500 or so students in the Oakland public school district. Previously, 70 percent of the students had to spend more than an hour on the bus to get to school. And some buses carried fewer than 15 students. Now with the changes we’ve put in place, less than 20 percent of students have a 60-minute commute. The majority of students spend less than 20 minutes commuting.
How about bus drivers? Are they out of work now?
Industries are changing. If you have a unique insight, this is the time to start.
Actually, we re-employed the school bus employees. The vendor that works with us has now re-employed them. But the number of buses needed on the route is optimized. Before COVID, our planning suggested that they would only need 80 percent of the buses; our technology means they can provide all the necessary transportation in accord with social distancing requirements and not need to buy additional buses. Because of our technology, we have a God's eye view of all of the transportation demand in an area. And we're able to essentially, would you say, logistically operate it because of having visibility to a whole region on the platform.
What’s been the advice from your board during this time?
The first thing we did when COVID hit was focus on the company’s runway. You want to make sure you're building a lasting company that survives through time, so ensuring that you have two years of runway was among the most crucial steps. Next the discussions went back to building the business and what we could do in this time period to come out as an even stronger leader. We wanted to make sure that we are honing in on the best possible offering for the product, instead of being everything to everybody.
What would you recommend to women, particularly women like yourself—young women with families—who may be thinking about, “Gosh, is this a good time for me to try to run a business? Or is it going to pull me in too many directions?”
I would absolutely say this may even be a better time to start something because there are such big and rapid transformations happening in the entire world because of COVID. Industries are changing. If you have a unique insight, this is the time to start. It's almost like there is a reset button on the world.
For me, running a business is very fulfilling. As a human being, it meets all the requirements that I need as a person in terms of making a broad impact, not just in the community but every day, on the employees, their wellbeing, their growth and their potential.
Women are ready to lead in these kinds of challenging times. There is this thing about compassion, empathy, looking at things holistically, multitasking, this resiliency thing that I keep talking about, which is part of being a woman and maintaining a career. Women prime ministers, like in New Zealand and the Nordic countries were among the first to bring their countries out of COVID. Any woman who has a career and a family has those stories of when their kids feel sick, or the day care arrangement fell apart and they had a meeting that they had to attend. We’ve all said, “That's it. My career is over. I won't be able to do it anymore.” Then we pulled through.
This epidemic gave me and others that ability to use those superpowers of empathy and compassion, even more. I would say being a woman CEO is really challenging, but women are designed to do that. So take the initiative, pull it through and stay there. It is a very fulfilling job.