Programmers Andrey Kalashnikov and Anton Nazmiev had to learn to work with small bus depots to create a successful bus transportation service / Maxim Stulov / Vedomosti

The idea for the service was born in 2008 by Ural Federal University graduate Andrey Kalashnikov and student of the same university Anton Nazmiev. Nazmiev worked part-time in the university trade union organization and ordered buses for student events. It was not easy to find suitable transport, negotiations with service providers often dragged on.

Kalashnikov worked as a programmer, Nazmiev also knew how to program, and the friends decided to create a website so that customers could instantly find the necessary transport. Now the Internet aggregator "Bus 1" provides work for 55,000 buses in 72 cities of Russia. In 2017, the service's revenue amounted to 350 million rubles, the plan for 2018 is up to 600 million.

Kalashnikov and Nazmiev registered the company "Business Partner" in 2009. The service was called "Bus 66" after the Yekaterinburg telephone code, and a few years later it was renamed "Bus 1". No investment was required in the business: the programmers made the website themselves in Kalashnikov's apartment, and the buses appeared from parks with which Nazmiev already had contacts. At first, the clients were small companies that needed to transport employees, and people looking for transport for funerals or weddings.

The friends spent 20,000 rubles a month on online advertising and website promotion, and earned commissions – 25-28% of the order value.

According to Kalashnikov, most bus depots in Russia have only 5-8 buses, and the owner of the depot is usually a former bus driver. He has little understanding of commerce and marketing, and carries a push-button mobile phone. Orders can only be placed and trips agreed upon with such suppliers by phone – Kalashnikov and Nazmiev even tried to create a mobile application for receiving orders, but nothing worked: most bus depot owners do not use mobile Internet.

Carriers say they are happy to cooperate with Bus 1 because they receive regular orders from it. Krasnodar entrepreneur Alexey Bashkirov, who has 10 buses, has been working with Bus 1 for a year now and transports employees of various companies around Krasnodar Krai who need to be transported to and from work. Over the year, the number of trips his buses make has increased by 60%.

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By 2010, the service was earning 1 million rubles a year, and the office employed four employees: two developers and two dispatchers, who made 20 calls a day.

Now, logisticians have been added to the dispatchers. The service works as follows: dispatchers accept orders from clients, pass the order to logisticians, and they call carriers from the electronic database with whom there are already transport rental agreements. "Bus 1" has created electronic databases of carriers and clients, as well as electronic accounting management systems. According to Kalashnikov, the agreement is concluded only with those carriers who have a license, and the fleet of vehicles consists of buses in good condition no older than eight years. "Bus 1" necessarily checks all carrier vehicles against the databases of the Ministry of Internal Affairs and the State Traffic Safety Inspectorate.

After receiving an order, the carrier sends the numbers of the buses on which it will transport customers. The documents for the transportation are prepared by "Bus 1". In most cases, says Kalashnikov, the State Traffic Safety Inspectorate only requires waybills. Many documents must be completed just for the transportation of children. The carrier receives the money immediately after the service is rendered. According to Kalashnikov, the carrier "Bus 1" has to be paid out of pocket at first, because customers usually transfer money to the service 30-45 days after the transportation.

Sergey Usachev, Head of Key Account Management at Bus 1, explains that most clients include a deferred payment clause in their contracts from the very beginning. Bus 1 issues clients an invoice, a certificate of completion of work, and a register of completed trips at the end of the month. All of these documents have to be sent to the region where the moves took place. The client's regional office usually takes about two weeks to process the documents, and then forwards them to its central office in Moscow. The central office often spends another two weeks processing the documents, and only then does the client pay the invoice.

Tender victories

In 2012, Business Partner already had 15 corporate clients in Yekaterinburg, with whom the company had concluded annual or three-year contracts for employee transportation. However, Kalashnikov and Nazmiev understood that in order to develop, they needed to win over larger clients. And these large clients appeared for Business Partner in 2015, when the company created its own small fleet of 10 buses, and then received a license for regular passenger transportation. The license allowed it to participate in tenders held by government organizations and large companies.

400 thousand cars
makes up the bus fleet of Russia, according to the analytical agency "Autostat" as of January 1, 2018.

15.5 years
This is the average age of buses used in Russia, according to Avtostat

According to Kalashnikov, it is not easy to participate in tenders. The company's tender department submits proposals for 200 tenders per month, but the company is only allowed to participate in 20, and it wins only one tender on average.

Nevertheless, such large companies as X5 Retail Group and Dixy have appeared on the list of Business Partner clients. X5 Retail Group confirmed the fact of cooperation. And the head of the transportation organization group of the Vnukovo distribution center of the Dixy chain, Irina Pagina, said that Kalashnikov and Nazmiev's company has been transporting the retailer's employees from Maloyaroslavets and Mozhaisk to the Vnukovo warehouse complex since 2017. According to her, Dixy chose this carrier for the optimal price-quality ratio. She does not disclose the exact amount of the contract.

Another major client of Business Partner, Atomtechenergo (a subsidiary of Rosatom), has been cooperating with it since the end of 2015. According to Alexander Baranov, head of the company's administrative and economic department, Atomtechenergo decided to use the carrier's services when the company's office moved from Mytishchi to Moscow and it became necessary to transport employees who live in Mytishchi to and from work. The company held a tender and chose Business Partner, which had the best price. Now Atomtechenergo pays Business Partner 500,000 rubles per month for a one-and-a-half-shift schedule of two buses.

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Baranov says that under the contract, Business Partner is obliged to provide cars on time, and in case of a breakdown, to immediately provide a replacement. So far, according to him, the cooperation is going smoothly. There was only one case when Atomtekhenergo almost unilaterally terminated the contract with Business Partner - due to the boorish behavior of the driver, who insulted passengers. Business Partner quickly replaced him, and the conflict resolved itself.

According to Kalashnikov, the company has repeatedly won tenders in government organizations - for example, for several years in a row it transported military personnel to rehearsals for the Victory Parade in different regions. The Ministry of Defense did not respond to Vedomosti's request, but the government procurement website contains information that in 2017, the Avangard company (Kalashnikov created it in 2011, also to organize transportation) won a tender announced by the federal institution "United Strategic Command of the Northern Fleet" for the transportation of personnel during military parades on May 9, 2018. The contract amounted to 4.2 million rubles.

Kalashnikov claims that Bus 1 made good money this year at the World Cup – the price for transportation rose from 1,000 to 5,000 rubles per hour, and in June the company received an additional 80 million rubles in 11 Russian cities, where its buses transported fans and foreign delegations. The Brazilian Embassy confirmed that Bus 1 transported the delegation of the country's sports minister in Rostov, Moscow and St. Petersburg.

Rapid development

Cooperation with large clients allowed "Bus 1" to grow quickly. In 2016, Kalashnikov and Nazmiev opened an office in Moscow and began working directly with large Moscow clients, and in 2017 they also created a branch in St. Petersburg. In total, "Bus 1" currently employs more than 100 people. In 2017, revenue reached 350 million rubles, 80% of orders came from large customers from whom the company won a tender. 30% of transportation is carried out in Moscow, where, according to Usachev, the company uses 2,000 transport units.

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If "Bus 1" really operates 2,000 vehicles in Moscow, then they can be considered a major player on the market, says Norayr Bludyan, director of the Moscow Agglomeration Transport Association. According to him, in Moscow, a carrier with a fleet of 100-120 buses is considered major. Usually, such successes are achieved by large and recognizable carriers, says Alexander Tur, CEO of the company "Autoline".

However, the company's rapid development in 2017 was hampered by cash flow gaps that arose due to delays in payments by clients, Kalashnikov admits. The company, he says, was constantly accumulating debts. At first, Nazmiev and Kalashnikov tried to solve this problem by borrowing money from entrepreneurs they knew at 30% per annum. Sometimes they had to borrow up to 5 million rubles at once. But it was always difficult to repay the debts.

New perspectives

In 2017, at FRII, where he had friends, Kalashnikov was offered to apply for borrowed funds on the StartTrack crowdfunding platform. StartTrack CEO Konstantin Shabalin says that Bus 1 received investments quickly: interest even exceeded expectations somewhat, and in addition to 25 private investors, an investment fund joined the deal. In total, the project attracted 15.9 million rubles in borrowed money on the platform. Of this, 7 million rubles were given to the company by the investment fund Magnum Capital. The fund's CEO Anastasia Chernova liked the idea of a bus ride aggregator, and Kalashnikov's plans for business development seemed realistic. If the service goes well, the fund will probably buy out Bus 1's share.

Kalashnikov agrees to sell his share of the company to large investors. In the meantime, he has used borrowed funds to pay off his previous debts and has begun negotiations on branches in several CIS countries. The plans also include his own fleet of 5-10 buses in each city where the company operates, in order to cooperate with large clients.

How Ural programmers created a service that connected bus customers with carriers