Marti Technologies, Inc. (MRT) Earnings Call Transcript
January 8, 2025
Earnings Call Speaker Segments
And it is my pleasure to welcome in CEO of Marti Technologies, Alper Oktem. It's wonderful to be with you today, Alper.
Wonderful to see you again, Dan. How are you?
Yes, we're doing this all the time now my man. It's -- the dream is alive. Listen, I wanted to start off and talk to you about why Turkey is such a -- the country, obviously, Turkey, not the meat, is such a great market for a ride-hailing platform to succeed in? And what did the market look like before Marti was there?
Turkey is a G20 economy with 85 million people. It is huge. Istanbul, the largest city, is the largest city in Europe with around 20 million people. That's a huge city. And unfortunately, unlike the rest of the world, ride hailing didn't arrive here until late 2020s -- sorry, early 2020s, a few years back, when we started here. Right now, what we're doing is trying to catch Turkey up to the rest of the world in terms of ride hailing and other urban mobility services that are tech-enabled. So think of countries, the size of Mexico or much larger than other large European countries like Poland or Italy. Turkey is a prime market to transport people within an urban setting with a mobility super app and Marti is exactly that company. We're the local champion. We're the dominant player. And we start out with e-scooters, e-mopeds and e-bikes and then extended our platform to ride hailing. And currently, we are the #1 mobility app in both iOS and Android stores, and we're quite proud with what we've achieved so far.
Yes. Such a huge market like you mentioned. You got to love being that local champion. It's such a big thing. And I want talk to you about driver recruitment. What does that look like? How difficult has it been to grow your fleet and retain those drivers? And what are the keys to success been there?
So we started the company 7 years ago, but we launched ride hailing around 2.5, 3 years maybe. And we've been very successful since it's launched. Currently, we have 260,000 ride-hailing drivers. That is 600,000 households, that is 600,000 cars or motorcycles on the streets because we do both motorcycle and car hailing at the same time. When we started the platform, we didn't monetize it. We focus on growth as much as we can. That's why we didn't charge a pay, we didn't charge a commission or put a take rate on any of our trips or drivers. That's why the financial impact of our ride-hailing branch had not reflected -- had not been reflected in our financial performance over the past years. Last year, we finished with $16.6 million of revenue from our micromobility operations, which is only a fraction of what we do. We are a, first and foremost, a ride-hailing company and we recently just started monetizing it and we're looking at more than doubling our revenues in 2025, up to $35 million a year. We are currently, again, at 260,000, 265,000 ride-hailing drivers. But by the end of Q1, probably in March or April, we're going to hit 290,000. So it is growing very fast. And it is spreading like wildfire. Right now, we operate in 4 cities. That's the 4 largest cities in Turkey. That's Istanbul, Ankara, Antalya and Izmir, but we're thinking about expanding to many more. And there are a lot more cities in Turkey that have the potential to be very large ride-hailing markets. Istanbul, as I mentioned, is 15 million to 20 million people depending on how you measure it. But there are over 10 cities in Turkey with a population of over 1 million people. So the future is bright. We are nonstop recruiting drivers and we have over 15 million downloads, I believe currently. We've been the #1 player, we've been the #1 app on the App Store or the Android Play Store for over 5, 6 years now.
That's amazing. Like you mentioned, the local champion, you got to love that. What is the TAM for ride hailing in Turkey? How much do you recently believe that Marti can capture that?
I mean it's a great question. And the answer is quite simple to calculate really. We will get New York because TLC keeps amazing numbers, and we try to benchmark it through TLC's numbers. So right now, as we speak, there are 750,000 taxi trips daily just in the city of Istanbul. The rest of Turkey included, that's 1.5 million ride-hailing trips in the entire -- sorry, 1.5 million taxi trips in the entirety of the country daily, right? So if you look at TLC and what happened in New York, once ride hailing arrives, the taxi market doubles. So when everything is said and done and the market is saturated, there's going to be 3 million ride-hailing trips in Turkey in total. At around $6 to $7 a trip, that is $7 billion of ride-hailing gross merchandise value, right? That $7 billion of GMV and the take rates in the market currently are around 25% to 30%. That's what Uber or Lyft charges in the U.S. That's what a lot of global players charge around the world. So when you multiply those 2 numbers, we're looking at a market TAM or however you want to call it, a GMV of $7 billion yearly and a revenue for ride hailing of $2 billion yearly. That's insane figures and the future is super bright. Right now, we are charging a small commission on our trips, mainly subscription fees for the drivers, but that's a fraction of what we can. If we were to grow to the level that we want to grow, saturate the market and charge the global average take rates, we should be looking at billions of dollars of revenue and we're super excited about it.
Just massive, massive numbers. And I know you alluded to this a little while or you transitioned recently in your monetization strategy. How is that going right now?
It's been much more smoother than we thought. because, again, 260,000, 265,000 drivers is a fairly large number of people. Just changing the monetary structure of how you incentivize or dis-incentivize or work with those people as gig workers is a huge transition. So over the past few months, we went from a zero commission world to a world where we monetize our drivers. And it took a while but right now, we instantly -- our projections instantly became free cash flow positive for the year of 2025. We -- again, we did $16.6 million of only micromobility or two-wheeled electric vehicle rental revenues in 2024. And with the addition of the small subscription fee for our drivers at a much lower than market take rates, we are going to be hitting $35 million of revenue in 2025 and that makes us free cash flow positive, hopefully. There is a huge chunk -- huge accomplishment for a company of 7 years, especially in a market that's challenging as this. But the fact that we came to scale without charging anybody anything, hence, we had prioritized growth so far has made it so much easier for us today to go to our drivers and say, "Hey, guys, we supported you for 2 years. We did everything we can. We built this market. Now it's time to chip in." And people are super happy about it as well.
Yes. It seems like you guys are in a great place right now that you want to be in. And we got a question from the chat asking, do you have any plans to expand outside of Turkey?
Right now, the market in Turkey is playing catch-up. So despite being the 17th...
I think we're a little delay there. We appreciate that question from the chat, but I will try to get Alper back in just a moment. [Technical Difficulties]
Saturation. It's a huge -- sorry, sorry, there. It's a huge opportunity. That's why our main focus right now for the next 1, 2 years is to reach that $7 billion GMV for the entire market and dominate the space with much -- with as much market share as possible. Because as you know, the first-mover advantage is huge in these markets. That's why Uber dominates in the U.S and the second player to enter, Lyft, is at a certain market share that is not akin to that of Uber. That's why right now, our focus is on Turkey. However, that being said, we are currently monitoring for talented teams around the world that we could acquire and work with. We're looking for teams that would fit our culture and our way of doing business and maybe acquire them to be able to enter other markets. Furthermore, Turkey on its own is a huge market and we could offer other services. So right now, for example, we don't monetize it, we don't make money from it, but we have a wallet within our marquee app, again, with 15 million downloads. It's a huge opportunity. We have peer-to-peer money transfer allowed in that wallet. If we decide to go for it and build a fintech out of it, that's a huge opportunity, too. So there are avenues both outside and inside of Turkey, even after we hit this huge market saturization goal for ride hailing in the country.
Yes. It seems like the possibility, which is obviously a very exciting thing. And I wanted to ask you about AI. We know, obviously, how big of a deal it is in so many things right now. Is AI changing how you operate at all? And how do you use it or plan to use it in the future?
The way we look at AI is, obviously, the world is changing. It's changing rapidly and companies that do not morph themselves into AI friendly entities are going to be left behind. So we're very careful and cautious about it, and we look at it in 2 ways. One, how is this going to change our operations of 2-wheeled electric rentals, micromobility, right? So we already have acquired the assets of a Boston-based AI-focused micromobility optimization company and name is Zoba. So we do our vehicle collecting, charging deployment, rebalancing of e-mopeds, e-scooters and e-bikes, our micromobility fleet, based on that AI tool. And we have a team working very diligently on how that could make our business better. And we see tremendous efficiencies from using those tools that are -- that have basically become possible with the emergence of AI. So that's the micromobility part and we are already, I'd say, ahead of the curve there. On the ride-hailing side, I think that's the most -- more exciting bit. Obviously, companies like Waymo, more Ubers, robotaxis are coming into the market. Our view currently is that, that market for ride hailing is going to resemble that of micromobility in the sense that there are going to be manufacturers of vehicles, manufacturers of technology up in the value chain. And then below that are going to be operators like us who acquire those fleets and who operate those vehicles. I believe within 5 to 10 years, there are going to be more companies like Waymo or Uber that offer those software and hardware readily available. They are going to make that software and hardware ready available for operators like us. And operators like us, any ride-hailing operation around the world are going to raise money and are going to acquire those seats and it's going to be about maintaining those cars, deploying those cars and operating those cars. And we have a 7-year experience in operating hardware. So we look at the age of AI for ride hailing to be super bright for us. We're ready for it. And our view is that there are going to be multiple players in the market that are willing to be -- that will develop the technology to sell to operators like us. And then we're going to buy those cars through financing, we're going to finance those cars and then deploy them in markets like large cities of Istanbul. And we are preparing for that. We're building teams, we're building strategies, and we're going to be ahead of the curve there as well.
And I love it. Very exciting times for Marti Technologies. And listen, it was an absolute pleasure talking to you today, Alper. Thank you so much for your time and all the best going forward.
Appreciate it, Dan. Thank you.
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