Last Updated: 07 January, 2025
The ride-sharing industry exemplifies one of the most substantial technological disruptions in the modern transportation industry. Built on the foundation of innovation and consumer demand for convenience, it has transformed how people commute worldwide.
In the 17th century, horse-drawn ride-for-hires were available in London and Paris. Then, the invention of the Taximeter in 1891 modernized fare calculation and led to the development of motorized taxis. Fast forward to the 21st century, with technological advancements, the real-time ride-sharing industry gained ground and platforms like Uber and Lyft began to experience phenomenal growth, offering services that helped passengers in finding an affordable, one-way ride in a short span.
As of now, the global ride-sharing market continues to experience robust growth by 2032 at a CAGR of 18.5%, anticipated to reach $480.09 billion by 2032. This segment has expanded far beyond its initial scope by 2024, embracing several technological trends and advancements.
Therefore, in this detailed guide, we will focus deeper on the complexities of building a ride-sharing app and finding a cost-effective solution to navigate and succeed into this dynamic industry.
A ride-sharing app connects passengers heading in a similar direction with drivers willing to offer rides. Unlike traditional taxi service models, ride-sharing platforms focus on convenient, affordable and reliable rides, often integrating features such as ride pooling in order to optimize costs and reduce environmental impact. These platforms leverage cutting-edge technologies such as GPS for real-time tracking, AI-driven algorithms and automated payment systems to streamline ride booking processes.
Ride-sharing applications have also brought the concept of aggregator business model to the fore. In effect, platforms like Uber and Lyft have a business model that uses a special algorithm to put ride-seekers in touch with ride providers. The fares are adjusted as per market conditions.
The ride-sharing business model also facilitates vehicle owners to become public service providers, as it gives them the flexibility to drive their own vehicles in areas they choose to work. It also functions without overburdening the service providers with exorbitant registration fees, tariffs, and licensing.
The ride-sharing market is highly fragmented and competitive in nature and the primary reason is the operators’ ability to utilize independent drivers. Technically, these companies do not provide rides to customers, instead, they connect passengers with drivers and charge for the service provided. Hence, ride-sharing services are arranged in a short time span, usually through a mobile app. And, these applications are impressive as with just a click, any individual can turn into a passenger or a driver.
Top players dominating the ride-sharing market are:
| Platform | Revenue | Launched In |
| Uber | $42.17 billion | 2009 |
| Lyft | $5.49 billion | 2012 |
| Grab | $2.70 billion | 2012 |
| Bolt | $2.11 billion | 2013 |
| Careem | $1.2 billion | 2012 |
| Gett | $424.7 million | 2010 |
| BlaBlaCar | $267.58 million | 2003 |
The convenience offered by taxi booking apps has made users more comfortable while providing businesses with a vantage point to deliver more value to customers by staying sustainable. Here, we share some strategic advantages that building a ride-sharing app provides:
Unlike traditional transportation businesses, ride-sharing platforms rely on a decentralized model. This model primarily reduces the need for asset-heavy investments. Operational costs remain relatively low with drivers using their own vehicles and app-based operations minimizing physical infrastructural requirements.
Ride-sharing apps excel in utilizing resources. These platforms match passengers with nearby drivers with the help of smart algorithms. Thus, reducing idle times and maximizing fleet utilization. Moreover, features like real-time tracking and route optimization further enhance efficiency. As a result, ensuring a seamless experience for users while increasing the profitability for businesses.
The ride-sharing business model extends benefits for all the stakeholders equally. While it offers quick, discounted rides for customers, it helps drivers save resources in terms of fuel and time and allows admins to build a brand by serving the needs of the former. Plus, this business model also helps reduce traffic congestion and vehicle emissions.
The ride-sharing business model is inherently scalable. Therefore, offering immense potential for global expansion. Businesses can adapt their app to different markets with ease by leveraging localization strategies. Furthermore, the app’s modular design allows for integration of region-specific features—catering to local preferences and regulatory requirements.
Ride-sharing apps open up multiple revenue streams, enabling businesses to diversify their income sources. Core revenue stems from ride commissions, but additional streams can include advertising, surge pricing, partnerships, etc. These varied avenues ensure consistent cash flow while driving long-term growth.
The ride-sharing apps contribute positively to environmental sustainability by encouraging shared mobility. These platforms help lower traffic congestion and decrease greenhouse gas emissions by frequently reducing the number of single-passenger rides. Plus, integration of electric vehicles (EVs) into fleet further enhances eco-friendly practices.
The traditional way of taxi booking has been an arduous task. But with the emergence of ride-sharing apps, the cab booking industry went into autopilot mode. Now, customers seamlessly book the cab through a ride-sharing app, get driver and payment details in advance, and upon trip completion make a hassle-free payment. This helps in improving the ROI and leads to the growth of the ride-sharing business.
A ride-sharing app has three interfaces—a passenger app, a driver app, and an admin panel. Listed below are the features for each interface:
| Features for Passengers | Features for Drivers | Features for Admin |
| Diverse Login Options | Driver Registration & Verification | User Management |
| Ride Booking | Ride Requests | Commission Management |
| Ride Sharing | Ride History | Subscription Order Management |
| Real-Time Tracking | Availability Toggle | Fare Calculation Utility |
| Fare Calculation | Subscription Offers | Vehicle Categories |
| SOS Alerts | SOS Alerts | Geo-Location |
| Ratings & Reviews | Ratings & Reviews | Manual Ride Booking |
| Parcel Delivery | Initiate Payout | Reports & Analytics |
| Book Ride for Others | Digital Wallet | Discounts Management |
The success of ride-sharing businesses like Uber, Lyft, and Grab has made numerous entrepreneurs interested in the ride-sharing business. In a bid to meet these requirements, the app development companies primarily offer two types of approaches to build your ride-sharing app. These are:
1. Custom Development
2. Readymade Software
Custom development allows to build a ride-sharing app as per the tailored requirements of a business or an entrepreneur and at a suitable pace. These apps are built from scratch providing complete flexibility to reflect unique brand identity.
Besides providing complete control over the development process to business owners, custom development demands a considerable amount of time, money and effort. As a result, delaying the market entry. Apart from this, this approach incorporates risks due to unforeseen circumstances, bugs and delays.
Pre-built software can aid in bringing the best results for your ride-sharing business without taxing your patience. Utilizing a readymade software offers a more cost-effective approach to create a rideshare app and the plus point is that it requires comparatively less time compared to custom development.
Consequently, these pre-built software solutions also offer the capability to extensively customize your ride-sharing app according to your requirements and reflect a unique identity. Also, they don’t limit scalability options as your business grows.
A few factors contributing to the success of readymade ridesharing apps are:
As mentioned above, ready-made ride-sharing apps are cost-effective and the time-to-market is less. Hence, a ready-made ride-sharing solution like VivoCabs is perfect to start your online ridesharing business.
Designed and developed by FATbit Technologies, VivoCabs is a white-label ride-hailing software that comes equipped with a wide array of advanced essential features required for automating ride-hailing operations. Native rider and driver mobile apps (Android and iOS) are also available. Apart from this, business owners enjoy several other benefits, such as:
Ride-sharing is quickly gaining momentum by harnessing the power of digitalization. Startups or existing businesses can benefit greatly from the changing ride-sharing dynamics. Further, innovation will drive the future of mobility. So, if you are looking to start or scale a ride-sharing business, get in touch with us.
We at FATbit Technologies comprise a multidisciplinary team, that blends their deep domain expertise with emerging trends, to deliver innovative ride-sharing applications.
All innovation starts with an idea to solve real-world problems. At FATbit Technologies we are passionate about driving digital transformation to prepare businesses for a digital-first tomorrow. Let’s discuss your BIG idea NOW.
Disclaimer: The Blog has been created with consideration and care. We strive to ensure that all information is as complete, correct, comprehensible, accurate and up-to-date as possible. Despite our continuing efforts, we cannot guarantee that the information made available is complete, correct, accurate or up-to-date. We advise - the readers should not take decisions completely based on the information and views shared by FATbit on its blog, readers should do their own research to further assure themselves before taking any commercial decision. The 3rd party trademarks, logos and screenshots of the websites and mobile applications are property of their respective owners, we are not directly associated with most of them.
Vibha Sharma is an accomplished senior content writer and marketer at FATbit Technologies, where she brings her passion for storytelling and digital expertise to create compelling narratives. With a Master’s Degree in Computer Applications, Vibha successfully blends creativity with technical acumen. Outside of her professional pursuits, Vibha is a voracious reader, an avid traveler, and a lifelong learner.
