The first public decisions of Marissa Mayer as Yahoo’s top executive has brought light onto the perks to attract critical talent in Silicon Valley and foster a productive environment: free food, smart phones, etc. One of the most successful employee programs at Google is the shared shuttle service between San Francisco and Mountain View, which has expanded to tens of buses in the Bay Area. The oldest company bus benefit is actually run by Genentech in South San Francisco. It started as a way to deal with parking limitations before growing into a popular employee retention program.
RidePal is bringing this green “perk” to smaller businesses who cannot afford it or do not have the resources to operate a bus system. The San Francisco based start-up launched last week four additional routes in the Bay Area, and participating companies can have a say on where the bus stops depending on their level membership. Workers can also vote on prospective routes on RidePal’s website (picture above).
The move to shared commuting is interesting in a country where public transportation is not the norm unlike Europe and Japan. Actually, this led companies like Sun Microsystems in the past to manage a comprehensive working-from-home program, with flexible dock-stations and conference rooms at their various office locations. Sun's Open Work program shed some light on telecommute savings. Sun was acquired by Oracle since, in a tenuous process with antitrust organizations that also highlighted cultural differences between the database and server companies.
Oracle is known for its cafeteria, well before Google, and Larry Ellison wants the staff to work and collaborate in the same location. Sun’s program has been mostly shut down as a result. In contrast, Google and Pixar built large campuses in South and East Bay but still need a way to attract and retain key personnel who want to stay in San Francisco. Time has changed, and even Apple has embraced buses and WiFi to provide a more fun and productive commuting experience. This is the value proposition of RidePal to its customers (picture below - courtesy of RidePal).
“When companies compete for talent, they actually have a much broader set of competitors than in their market vertical. This is mostly a marketing task but it falls into HR and Recruiting departments”, explains RidePal's CEO. “Like any marketing task, there is a messaging, a story, and a benefit that they want bring attention to people". The main barrier the companies that we are talking to face is distance. If the distance between the home of the prospect and their workplace is too long, they don’t get to tell the benefit and the story becomes irrelevant”.
Nathalie Criou remembers an anecdote from Google that shows how powerful a recruiting tool it can be. “HR asked the program manager of the shuttle department to move a stop by 100 yards in order to keep one of their rock-star back-end engineers.” And shuttle programs have grown very popular with existing employees, at Google for instance where more than 90% of remote employees use the program. As a result the number of private buses in the city has grown significantly, sometimes creating problems to public transportation.
RidePal does not use stop-signs in the city and their staff remains in contact with city officials. Their solution can actually help alleviate the number of private business buses with a higher level occupancy across multiple companies. But the line is becoming blurry with public transport. Nevertheless, commuting remains the number one obstacle of many companies recruiting in Silicon Valley, and RidePal focuses on serving that tech savvy and increasingly socially responsible market. Start-ups have to adjust their story to a younger workforce that has grown with the Internet and wants more social interactions.
The audience for greentech start-ups is also changing with many VC’s walking away from cleantech unless they have the funds to wait for a return that typically takes ten years. This is what the co-founder and CTO of eMeter stated at Soft Grid conference last week organized by Green Tech Media. The smart meter company was acquired by the grid and transportation giant Siemens but after 10 years. That is beyond what most VC's funds last. Yet, one of their investors, Foundation Capital, continues to invest in greentech at the rate of one or two investments per year.
What to do when there is a shortage of capital for early-stage greentech start-ups? Like other successful accelerators in Mountain View, GreenStart opened a 3-month program in San Francisco (picture above -courtesy of GreenStart) focused in the intersection of IT and green businesses that does not require the massive investments that solar or electric car companies require to break even. GreenStart announced yesterday its next round of start-ups for the Fall 2012 intake.
If RidePal bridges companies and employees in the Bay Area, GreenStart helps brige the cultural gap between Silicon Valley and green companies often from East Bay or Marin County. Brand building and focus on execution are not necessarily in their DNA because of the long-term research environment and the different values that non-for-profit organizations promote. GreenStart invests $115k in the companies taking part in the program and provide a network of mentors. They do that not just because of environmental consciousness, but because it makes good business sense according to Rachel Barge from GreenStart.
RidePal was a natural fit for GreenStart’s program and graduated with the “class” of Spring 2012 . Like the other four companies in the intensive program, RidePal has environmental benefits. Commuting by car is the main contribution to air pollution, especially in traffic. According to Nathalie Riou more than 65% of people in the US use their car to go to work and all urban areas have air control issues. "By sharing a bus, it will reduce their carbon foot-print by 40%". Taking a bus to work is work is more impactful on the environment than installing a solar roof".
"GreenStart helped us a lot with our pitch and also on brand design". GreenStart has its own brand design capability with a partner coming from Frog Design known for its work with Apple. Nathalie Riou shared her story-telling experience at GreenStart with other greentech entrepreneurs in a webinar organized by ARPA-E this summer. “GreenStart gave us the methodology to cristalyze what it was that we were doing. Recruiting and retention came #1 on the list."
“It is actually a difficult exercise to capture in a few words a value proposition” notes RidePal’s CEO. Greentech companies have many more stories to tell. Like screenwriters pitching a pilot to producers in Los Angeles, green entrepreneurs are sharpening their pencils in San Francisco to present their business to investors. RidePal has an interesting plot and Nathalie Riou is currently closing a seed round to go in production.