After Expanding To Kenya, Egypt's Swvl Is Now Headed To Uganda

Towards the end of 2018, Mustafa Kandil, co-founder and CEO of Swvl, told Almal News some of their expansion plans. He pointed out that they were looking to expand to “10 cities outside Egypt in 2019, beginning with the Philippine capital of Manila and including Nairobi, Dakar, and Jakarta”.

Early last month, we found out that the startup - which operates a bus-sharing service, was finalising expansion plans to Kenya. This conclusion was based on the adverts that Swvl was running on its Facebook page targeting Nairobi residents.

Less than a month, the startup is headed to Uganda according to an email that Digest Africa received. The email contains details of a General Manager job position that Swvl is looking to fill. Per the job description, the person who will fill the role will lead the startup's expansion plans into the East African country.

"After the huge success of its first market, Egypt, SWVL is seeking an entrepreneurial, experienced leader to take charge of the expansion of its innovative transportation system in Uganda," read some of the details.

"As Uganda General Manager, you will be responsible for the development and growth of SWVL’s business in Kampala and Uganda as a whole. You will be leading efforts to roll out SWVL’s new, innovative transportation system."

According to a 2017 World Bank report [PDF] titled 'The Role of City Governments in Economic Development of Greater Kampala', it is estimated that 24,000 man hours a day are lost by commuters due to traffic jams.

In the past decade, the Ugandan government has always had plans to curb the escalating traffic jam by phasing out taxis (matatus). It had planned to substitute them with alternatives such as Bus Rapid Transit (BRT) or rapid rail systems. However, none of that has come to fruition or execution - yet.

The report cited above from the World Bank expressed the urgency that is needed to bring to order the traffic flow in Uganda's capital. "The current transport system and regulatory environment needs to be further strengthened", it pointed out.

Also read: Egypt’s street food vendor Zooba Eats raises $4M for US expansion

"A complete and sudden phasing out of taxis will not be feasible in the short run. As KCCA (Kampala Capital City Authority) has taken over more control of the taxi industry’s regulation since 2015, this provides an opportunity to regulate better and coordinating taxi (matatu) routes and stops, hopefully leading to less congestion and better traffic management."

Despite the urgency of the situation, there's been little or no intervention from the government. For example, with the boda-boda industry, SafeBoda - a private player - is the one that instead brought order to the widespread chaos. It is, therefore, highly likely that it will take a private player like Swvl to bring order to Uganda's public transport system.

Founded in April 2017 - with over $38 million in venture capital raised - Swvl started to ensure that the roads were maximumly used; "It started with an observation turning into a realization," the startup notes, "too many cars on the streets, wasting our limited resources: time, space and money."

The total number of cities that Swvl is operating in currently is not precise. Though, the expansion to Uganda - Kampala in particular - would bring the startups number of cities across Africa to at least four - Cairo, Alexandria, Kampala and Nairobi.

Swvl is among the pioneers of the bus-sharing service across the globe, yet it has come under competition in recent times in the different regions where it operates. Among its main competitors in the Middle East and North Africa region include its former backer - Careem as well as Uber which launched its bus-sharing service in Cairo last year.

In East Africa, Swvl will face competition from Safaricom-backed Little which also debuted its bus-sharing service in Nairobi at the beginning of February 2019 while Uber has also expressed interest in launching a bus/matatu sharing service in Kenya.

What is interesting is that both Uber and Little - unlike Swvl - already have their ride-sharing services in Uganda. Therefore, it won't take them long to add bus-sharing on top of their current offering. What we have learnt over time is that merely adding service on top of the existing is not enough to win that particular vertical.

An example of SafeBoda can be cited: although both Uber and Taxify added boda-hailing services on top of their then current offering, they have largely failed to outcompete the SafeBoda whose only focus is on the boda vertical (for now).

Digest Africa


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