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Monica Zarafu from BYKKO

Jul 20, 2020 | Female Founders, Founder, Hunter Central Coast, New South Wales, Newcastle, Podcasts

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Today you’re going to hear the story of BYKKO and it’s founder Monica Zarafu.

Born in Romania, Monica moved to Australia in two thousand and ten. Motivated by a need to mitigate the threat of climate change, and seeing the mass adoption of bicycles in parts of Europe, Monica is aiming to do more than build a successful business. With the lofty ambition of reshaping the way we think about transport in Australia, Monica has been working hundred hour plus weeks to build BYKKO as a proof of concept, with the hopes that an electric bike sharing model could be adopted by governments and used as part of integrated public transport systems. But before we dig into the details of how Monica believes electric bike sharing can change transport in Australia, first we need to go back to day one, and learn about the research Monica undertook which ultimately led her to believe that, as she says, “bikes are the future”.

Transcript

Adam:

Hi, and Welcome To Day One, the show for regional startups and the organisations that support them. I’m Adam Spencer, and today I’ll be sharing with you the story of Monica Zarafu, the founder of BYKKO. 

Quick note: Since sitting down with Monica for this interview and the process of putting the episode together, BYKKO announced some exciting news. They have a new CEO, Mark Arandale. 

More

Monica:

Hello, I am Monica, managing director of BYKKO. BYKKO is an electric bike share company. It was the first of its kind in Australia. We started in 2014 with push bikes, but in 2016 we moved to electric bikes. So we provide a platform for electric bikes, with docked bay systems. You can dock the bike and charge the bike through the docking terminals.

 

Adam:

Born in Romania, Monica moved to Australia in two thousand and ten. Motivated by a need to mitigate the threat of climate change, and seeing the mass adoption of bicycles in parts of Europe, Monica is aiming to do more than build a successful business. With the lofty ambition of reshaping the way we think about transport in Australia, Monica has been working hundred hour plus weeks to build BYKKO as a proof of concept, with the hopes that an electric bike sharing model could be adopted by governments and used as part of integrated public transport systems. But before we dig into the details of how Monica believes electric bike sharing can change transport in Australia, first we need to go back to day one, and learn about the research Monica undertook which ultimately led her to believe that, as she says, “bikes are the future”.

 

Monica:

I am a transport engineer, but in 2010 when I came to Australia… I was very lucky to meet Dr. Garry Glazebrook, one of the best urban planners, transport planners we have in Sydney. I studied a Master by research with Garry. Through the research, I did a Master by research looking at personal rapid transit systems… This brought me three big achievements… a scholarship from CSIRO looking at climate change, mitigation from a transport perspective… 

Then my research also got an award, the first Martin Lowson Award from Advanced Transit Association, it was my chance to visit Silicon Valley. And, I got a job at City of Ryde.

 

Adam:

So Monica’s research for her Masters degree helped bring her three big achievements: a scholarship from the CSIRO, the Martin Lowson Award from the Advanced Transit Association, and a job as a transport engineer at the City of Ryde. 

While working for the City of Ryde, Monica continued her research, and increasingly believed that bikes could play a major role in reshaping Australia’s transport systems. While bike sharing ventures had been tried in Australia, they had mostly been considered unsuccessful. But Monica has seen these systems work in Europe, and believed that they could work in Australia too.

 

Adam:

Right. In Europe if we just go to Europe for a second because you’re from-

 

Monica:  

Yeah, I’m born there anyways. 

 

Adam:

Where were you born?

 

Monica:  

In Romania.

 

Adam:  

In Romania. Is that the perfect vision of what bike sharing could be? If you go to Europe, what does it look like over there?

 

Monica: 

It’s a really good picture to be honest, because every major city has a public bike share scheme. Some of them even have more systems, and not only does the government support bike sharing, but also railway agencies or other public transport agencies subsidise bike sharing as additional transport mode to expand their services, by rail by bus by light rail… We need to look at different models for something like this to work in Australia.

What I believe is bike sharing should be integrated with other public transport modes.

 

Adam:  

Right. Why?

 

Monica:  

Because it’s a perfect solution for short distance trips. Not only short distance trips, because now with electric bikes (and this is why I introduced electric bikes), they can reach up to 25 kilometres per hour with power assistance. So you can actually reach not only CBD but other suburbs easily.

 

Adam:

One thing that Monica believes is holding bike sharing back in Australia is the way we expect that bike sharing should be a profitable business, as opposed to a public service like public transport.

 

Monica: 

Where I see the problems and I wanted to prove wrong is that bike sharing is public transport infrastructure. No public transport mode makes profit. We don’t have a huge percentage in mode share for public transport. Why would bike sharing be compared with car usage, it doesn’t make any sense. So if we don’t consider failure light rail, or with much more investment than bike sharing, why still bike sharing in Australia was considered a failure? I still think it’s a wrong perception of bike sharing, and we try to do, in our way, prove that a properly planned bike sharing system can work.

 

Adam:

So Monica set out to change people’s perception of the role bike sharing could play in public transport. Her research and the accolades it brought her had given her access to a network of people working in local councils and state government, and so she started talking to them about the potential of bike sharing.

 

Monica:

And I started going to meetings and conferences, talking to people about what bike sharing would be. Then we decided, “Okay, let’s do something”, because I thought things were going too slow for me. I wanted to be a bit more dynamic and that is when I started a business and I said, “I will do something. I’ll prove the concept.”

 

Monica:  

I was working at City of Ryde in Sydney and I told my husband, “We should start a business with bikes.” We didn’t know what kind of business, but I saw the movement in Europe (mainly because I did research in Europe and the United States) and I said, “These will be huge, bikes are the future and they are a viable option for short trips.”

 

Adam:  

Okay, when you… 2014 was when you started?

 

Monica:

Yes. We started with a few self serve bike hire stations. We installed the stations at a few hotels in Sydney, Newcastle and Hunter Valley. It was a side business and a small business. 

 

Adam:

So you were working full time?

 

Monica:

Yeah, and my husband too. We were looking to buy a bike shop at the time, but then we realised the competition from online sales would be fierce and we saw in Sydney a lot of bike shops closing down, because of the online sales. So no, “Let’s let’s do some bigger” and I wanted more. We started with a few stations for hotels, but I wanted more. I dreamt of having a bike station at every new residential building and office buildings.

 

Adam:

Was it always in your mind to launch your business? Or was it you just got to a point where you’re like-

 

Monica: 

No.

 

Adam: 

… “Well I have to do this” because-

 

Monica:

Yes, it was pretty much this, “I have to do this. I have to do something.” 

 

Adam:

Right.

 

Monica: 

And I did.

 

Adam: 

Can you tell me about… So 2014 you launch the business? Was there any big kind of launch around that? 

 

Monica:

No.

 

Adam: 

Was there media attention?

 

Monica:

No, nothing. We just found some off the shelf solutions with push bikes, self-serve stations. It was pretty much bike hiring.

 

Adam:

On day one of the business, when you decided, “We’re going to do this.” You go and register the company, what do you do next? What’s the most important thing that you decided that, “We need to do”  to make good progress? Was there one thing that you were trying to accomplish?

 

Monica:  

At the time it was finding good locations, because that business model is based on revenues from bike rentals. We started looking at touristy areas.

 

Adam:

Yeah, right.

 

Monica: 

This is how Newcastle came to our attention. We didn’t know much about Newcastle at the time, we were living in Sydney.

 

Adam:

Right.

 

Monica:

For many years.

 

Adam: 

Okay, because earlier on I think you said you launched the business in Newcastle, but at this stage when you were deciding, “We’re going to start a business”, you were still living in Sydney?

 

Monica: 

In Sydney, yeah. In fact, we launched the business in Sydney because we had stations in Sydney too and we were living in Sydney. Then we moved everything to Newcastle, even myself and my husband, we moved to Newcastle. 

 

Adam:  

What was the main reason for the move? Just because Newcastle was the most ideal location to test this?

 

Monica:  

It was business related, but we also fell in love with Newcastle.

 

Adam:  

It is a beautiful city.

 

Monica: 

It’s a beautiful city and it was an unexpected discovery. People in Sydney, even today, they don’t get it. 

 

Adam:

Yeah. 

 

Monica: 

We love, you know-

 

Adam: 

This is a perfect balance. 

 

Monica: 

It’s a perfect balance, yeah.

 

Adam:

So out of a sense of having to do something, Monica and her husband start their business with some off the shelf, self service bike rental stations. They set them up at a few hotels, first in Sydney, then in the Hunter Valley and Newcastle, where they eventually relocate after falling in love with the city. These first rental bikes were old fashioned push bikes, where you could only go as fast as you could pedal. They were somewhat successful as a proof of concept, but they were only bringing in a small amount of revenue. This was not the grand vision of a bike sharing solution, integrated with public transport, that Monica envisaged. If they were going to change the way Australian’s got around, they needed to move faster.

 

Adam: 

… You said it took a lot longer than you wanted it to. You put a couple of stations around, but that wasn’t happening quick enough. What so what did you do to speed things up?

 

Monica: 

It was, as I told you, I spent a few good years just presenting the concept, okay?

 

Adam:  

Right. 

 

Monica:  

But then at a cycle show in Europe I tried an electric bike, and that was the wow moment.

 

Adam: 

Ah, right because still you were doing just pedal bikes.

 

Monica:

Pedal bikes, trying to convince the government to invest in bike sharing with no success at that time. I tried an electric bike and I said, “Oh my god, things have changed again.” I’m not fit, you see. I’m not really unfit but I’m not a fit person. I wasn’t into cycling. I love riding a bike, but I didn’t feel confident enough on a push bike to go on the main roads because I had this queue of cars behind me… 

I tried an electric bike and I said, “My God, this is wow.” I thought, “It’s so good for me that now I can feel confident to go shopping, to do errands, go to meetings without getting all sweaty.”  I said, “This will be the game changer for other people like me, especially women”, and that was the  moment everything changed in our business. From that moment forward, we said, “Okay, we will stop what we do now, we will start investing in developing an electric bike share system.” 

 

Adam:

Monica experiences the added confidence that an electric bike can bring to a cyclist on the road, and she believes that this technology could move them towards their goal much faster than old fashioned push bikes. The vision was still to integrate bike sharing into public transport, but with the pivot to electric bikes also came a new target client: residential property developers. 

 

Monica:

… We got interest from residential developers. We had on Forbes, the article of residential developers, they really… The project director, he loved the idea. He said, “Yeah, I want to be an early adopter. I love what you’re doing.”

 

Adam: 

Can you tell me more about that? Did they reach out to you, or did you reach out to them?

 

Monica:

No, I reached out to them.

 

Adam:

Had you decided you were going to… As a strategy, were you going to reach out to property developers? 

 

Monica:  

Yes, as a strategy we started approaching real estate developers. Especially the new developments with a lot of new amenities.

 

Adam: 

What did you say, just paraphrase, what did you say to them? What were you saying to them to make them go, “Okay, that’s interesting.”

 

Monica:

I told them that this is the future gym or pool of a building, an electric bike share station. 

 

Adam: 

Right? 

 

Monica: 

… I told them that, and I still believe this, it’s a great selling tool for them…

 

Adam:

In 2016, BYKKO score their first customer for an electric bike sharing system, a residential real estate developer. It’s a relatively small contract, 10 bikes in a residential building, but it’s proof that there are people out there interested in their vision for electric bike sharing. 

And in the same year, Monica comes across an opportunity to test out their dream project: a public bike sharing system. The opportunity is the Make Your Place grant from the City of Newcastle, which allows them to set up a three month trial in Newcastle West, where members of the community can register to use the shared electric bikes for free. 

 

Monica:

… We won the City of Newcastle ‘Make Your Place’ community grant, we installed a station. At a time we had a space, an office space at Rethink financial building, it was a shared office space and we said, “It’s a perfect place. It’s kind of insulated from the city. People… They have a cafe on site, they won’t go out too much.” We put a station there and people started going on lunch breaks to the beach, posting photos, and then people contacted us, “Ah, bring the station in Wickham, bring the station at the ferry, bring the station in Hamilton”, you know.

 

Adam: 

How important was that to you in the business? 

 

Monica: 

Very important. Very important because it gives us the opportunity to test the model. 

 

Adam: 

Right? Did money come with that?

 

Monica:  

Very little.

 

Adam:

Very little? Right, so what was the benefit of it? It was just the ability to test it around-

 

Monica:

Just the ability to test and get some data and prove, you know, show that actually people are using electric bikes, given the opportunity.

 

Adam:

And then, in early 2018, BYKKO was awarded a contract by Transport for New South Wales to install 19 electric bike sharing stations across the city of Newcastle. And from there, BYKKO’s growth continued to pick up the pace.

 

Adam:  

Can you wrap some numbers around where the business is today? You don’t have to talk about revenue or specifics, but just some things that you measure your success by? Your milestones?

 

Monica: 

We’re actually quite proud of our achievements considering that we are still a small company and a bootstrapped company. 

 

Adam:

Yeah. 

 

Monica:

We started with initially 25 bikes in 2014 and now we have programs running in Newcastle, in Perth. We just launched in Perth a program with RAC WA and University of Western Australia. We have in Canberra, we have new installation soon in Sydney, Sunshine Coast, Noosa. It’s a huge growth.

 

Adam: 

How many bikes in total are out there on the roads? 

 

Monica: 

Currently around 300, but by the end of the year, we will double the numbers.

 

Adam: 

Wow. What’s been the biggest challenge for you in running BYKKO? … What’s the hardest thing about it for you?

 

Monica: 

To create a market for our product here in Australia.

 

Adam:

Right.

 

Monica:

I think this was the biggest challenge for us, to create a market. I think we are a bit ahead of the times. It was too new. Bike sharing is not new, but in Australia it was a bit new. Even the concept of residential bike sharing was absolutely… No one knew. People in Australia, they don’t take risk easily. 

 

Adam:

No, especially-

 

Monica:

It’s a very different environment compared to Europe or the United States. There you have to be the first always, and I came with this idea, “Let’s be the first” but it’s much harder here.

 

Adam: 

I think perhaps you picked the… Newcastle is notorious for being hard to get things going.

 

Monica: 

Everyone told us that if we succeed in Newcastle, the market will open. I didn’t understand exactly what they wanted to say. We understand now. 

 

Adam:  

Yeah.

 

Monica: 

It has been difficult.

 

Adam:  

Yeah. The biggest challenge has been creating the market. How have you been trying to overcome that? How have you been overcoming that challenge?

 

Monica:

100 plus hours work, per day, per week?

 

Adam:

That was gonna be my next question. How many hours are you working? Yeah, hundred plus hours.

 

Monica:

Hundred plus, no weekends no holidays. I don’t know when the day starts or ends. Because…

You invest whatever you have if you believe in an idea. This was our belief. I was so determined to prove that, and I still believe. Imagine if every developer would provide bikes for free for residents. This will be a game changer in the entire urban landscape, because people will be encouraged once they try. Do you know how many people we have, users here in Newcastle they send me emails thanking for the system and telling me that they bought electric bikes after a few months of using our bikes, because they discovered how great they are.

 

Adam:

A huge thanks to Monica Zarafu for taking the time to speak with me.

This episode was produced by me, Adam Spencer, with scripting and audio editing by Andy Jones.

Information about everything mentioned in this episode can be found on the show notes page at welcome to day one dot com.

Music by Lee Rosevere, full attribution on the welcome to day one website.

If you’d like to support this show, please consider leaving us a review or supporting us on Patreon.

I’m Adam Spencer, thanks for listening.

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