Last year, CharterUP processed over $300 million worth of trips on its platform, according to CEO Armir Harris.
Everything changed in March, as mass closures were ordered to prevent the spread of the coronavirus. Demand for motorcoaches dropped drastically. At one point, revenue was down to 98% compared to a year earlier.
The tech startup surveyed 2,500 private bus companies across the country to better understand how they are impacted by the coronavirus economic crisis. The results revealed that 43% of bus companies will go out of business within three months, and another 30% within six months.
“You’re looking at 73% of bus companies will be out of business in six months,” Harris said. “This data just shows that industry is in dire need and is really struggling to stay afloat.”
Spotlight on urgency
Many of those impacted are multi-generational family businesses with higher debt loads and capital expenditures.
“We’re trying to tell Congress there is an urgency,” said Harris, whose company has sent the survey results to congressional leaders along with signatures from hundreds of motorcoach operators.
Harris believes his company is the first to take a data-driven approach to describing the industry’s problem.
He says his connection to the industry began 16 years ago. After he arrived in the U.S. as a political refugee from Albania, Harris settled with his mother and sister in Charlotte, North Carolina. Harris was a teenager when his uncle built a limousine and motorcoach business. He drove limos as a high school student and moved on to school buses and party buses while he was in college. His uncle had the business for five years before selling it in 2014.
“My uncle started out driving cabs. We saved our money. One cab grew into a black car, which grew into four black cars, and then party buses and stretch limos and, finally, motorcoaches,” Harris said. “I remember when we got our first bus, I was about 17. This big MCI bus pulled up. It was like love at first sight.”
In college, he studied economics and marketing. Then, he got into software engineering and software architecting. In 2013, he launched Shofur in Charlotte, a platform that booked buses for events and tracked their location in real time.
He says he started CharterUP in 2017 to disrupt what he describes as a broken bus broker model that lacked transparency. The brokers were taking significant market share from the bus companies, Harris said. His company was created, according to Harris, to give operators a way to regain their market share online.
“No one has ever really tried to build a transparent marketplace. We’re building an Expedia for buses, where customers go into the platform and request quotes and they can see all the bus companies in their area right away,” Harris said.
He describes CharterUP as an information factory for the customer, who can see a list of bus companies and details like years of operation, amenities, size of the fleet and safety records.
Harris understandably has a stake in the industry rebounding.
“Everyone needs the bus industry to survive. What happens when demand picks back up if 73% of bus companies are out of business? We’re not going to have the supply to serve the schools, communities, the federal and state emergency efforts, the Department of Defense and get America moving in general.”