“Everything rises and falls on leadership.” John C. Maxwell
When a business isn’t working, the leaders are the problem. Fish rot from the head. Businesses have failed or succeeded based on the kind of leadership they have. That is because leaders determine the business model and also the culture of the organization. The ultimate success of an organization depends on the ability of the leaders to influence and persuade people and to create value for them.
Markus Villig and his elder brother started Bolt, the ride-hailing company in Tallinn, Estonia in 2013 when he was only 19. He launched the app on a budget of five thousand euros. This was a market highly dominated by Uber. How could he survive in such a market as a startup?
Firstly, he doesn’t have as much money as Uber to build on. In May 2016, Uber raised $5.6bn, giving it a valuation of $66bn. After Uber’s public offering in 2019, its market capitalization became $91bn. The consequence was that no VC wanted to invest in Bolt.
Secondly, Tallinn was free from the influence of Uber. He could therefore experiment with his business model without having to compete for head-on with Uber. He needed to validate his business model first before getting into the market where Uber was in.
To test his business model, he gathered about 100 drivers who were prepared to take a chance. However, when he launched in 2013, those drivers didn’t come online. That was when he realized that they had given him false contact details. Instead of giving up, he decided on a better strategy.
He started going to the taxi stands and signing those drivers upright in their taxis. He takes their phone and signs them up on the spot then inform them to just open the app when they come to work. By the winter of that year, he had a few hundred drivers and was offering functional service.
With a validated and functional business model, he fundraised seventy thousand euros. Six months after that he raised one point four million euros. By then he had good traction and a business model that was working well in Estonia.
Leadership Value That Helped Bolt’s Culture
People must, first of all, buy into the leader before they buy into the vision or business idea of the leader. We attract people who are like us. One of its values of Markus Villig is frugality. Bolt would not have grown if Markus had tried to outspend Uber to get traction. Uber’s weakness was the money it raised, while Bolt’s frugality became its strength against Uber.
Villig was able to attract employees who have similar values to him: they were frugal. How can a business that raised two million dollars compete with another business that raised one point two billion dollars in funding? It’s scary. As such, Bolt targeted countries where there was no competition to grow. That way it won’t have to spend money to get market share from Uber. Their frugal strategy worked. By 2019, Bolt’s turnover has increased from $730,000 in 2013 to $142,000.
What is Bolt’s Employee Segment (the kind of people they attract to themselves)?
…what we really look for is drive, intelligence and integrity. In other words, people who work hard, learn quickly and care about those around them.
We focus on what each person can become, not only what they’ve done in the past.
They are looking for “professional, driven people with integrity, who want to help drive us forward and make a lasting impact.”
He also provided his people with an inspirational purpose and cause that focused them on self-actualization rather than what they could get. Every employee was convinced that they were doing something unique and better that is helping people. Here is their purpose:
“At Bolt, we’re building a future in which people are no longer forced to buy a car to get around. Where people have the freedom to use transportation on demand, choosing whatever vehicle is best for the occasion.”
Values & Purpose Became Value Proposition
Their purpose produced their value proposition to the customers. They are not just solving logistics problems, but providing freedom for their customers. They are in the business of providing freedom to their customer. Each day every activity they embark on is to provide freedom for their customers. That way they attract customers who love freedom.
Our products and services are designed to offer a reliable solution to the world’s logistic problems, doing so in an affordable, safe, and sustainable way.
Bolt’s purpose is clearer than that of Uber. Here is Uber’s purpose for you to compare:
“We ignite opportunity by setting the world in motion.”
While Uber promises opportunity, Bolt promises freedom. The deepest desire in the heart of people isn’t opportunity but freedom. Freedom makes them feel good and self-actualize. While Uber aims at the lowest rung of human needs, Bolt focuses on the upper.
Bolt’s purpose and Villig values combine to give Bolt a better culture and strategy. People do what they see their leaders do and not what their leaders say. Villig walks the talk when it comes to frugality. He makes sure that spending is minimal. He lives it and his people see the integrity and follow the behavior. Leaders model and recognize the behaviors they want to see in their people.
As a result, people trust leadership and build relationships which results in altruism. Their people had to make sacrifices to take pay cuts during the Covid 19 lockdown compared to Uber which had to fire a lot of its staff. When everything came back to normal, Bolt still had its good people.
You need leaders whose values will transform into their culture and business model. That is how to build a human-centered organization.
Oladimeji Olutimehin is a Keynote Speaker, Value Giver Coach and Truly Human Consultant
