is a dying practice, but Rick Steele is applying CPR.
Indeed, the Herndon visionary and entrepreneur hopes to
inject new life into ride sharing as a strategy for
coping with traffic congestion, dependence on foreign
oil and excessive air pollution.
Census numbers document a troubling decline in ride
sharing in recent years: from 500,000 Virginia commuters in 1990
to 441,000 at the turn of the millennia. Virginians,
like other Americans, are
so busy, they have so many side trips to run, and their
work schedules are so irregular that they hate
committing to a schedule of driving to work with someone
Steele, president and co-founder of NuRide, has developed
an online service at www.nuride.com
where commuters can plug in a location, destination and
a time of day to see if they can find someone making the
same trip. The beauty of NuRide is its flexibility.
“Traditional carpooling locks you into a schedule,”
Steele says. “With NuRide, you can book just one
give commuters extra incentive to share rides, Steele
showers them with discounts, freebies and other special
offers from retailers along their routes. For regular
carpoolers, those bennies can add up to hundreds of
dollars per year. The retail perks may take the back
seat, however, to gasoline conservation as a ride-sharing
motivation. With gasoline crashing the
$3-per-gallon barrier and the cost of driving fast
approaching $.50 per mile, sharing rides translates into
serious cash savings.
NuRide, which launched in the Washington, D.C., area in
March 2004 and has expanded since to Houston, New York,
Long Island and the entire state of Connecticut, has
registered about 5,000 riders. About half are located
in the Washington area. On any given day, about 30
percent of NuRide's registered riders use the service.
Virginia Department of Transportation is supporting
NuRide financially in the expectation that it will take
cars off the road. Although no one expects ride sharing
to solve all of Virginian's road-congestion woes, it
could prove to be an important piece in a larger puzzle.
VTrans2025, the Warner administration's transportation
strategy plan, says that building enough new road and
transit capacity to keep up with projected traffic
growth will require an average of $5.4 billion a
year in new revenues over the next 20 years -- a
politically unattainable sum. Virginia has no choice but
to look for solutions like NuRide that are potentially
more cost effective.
NuRide's 5,000 thousand
riders is a drop in the bucket compared to the millions
of motorists in three of the nation's largest metro
areas. Heck, it’s less than a drop in the bucket…
5,000 riders is an invisible droplet of mist. But Steele
insists that the number will swell in the year ahead. He
deliberately throttled back growth last year, he says,
while he was refining the service. “In the next
year,” he promises, “you’ll see our efforts really
cites Metcalfe's law -- the theorem that the value of a
network increases exponentially with the number of
people who use the network -- as the basis for his
optimism. The greater the number of people within a
metro area that uses NuRide, the more likely that they
can find someone to share a ride with. The more frequently
people use the service, the more word spreads. Says
Steele: "Our growth rate is compounding every
of four co-founders, Steele has 20 years experience in
running high-growth companies. NuRide's chairman, Thomas Murray, is
CEO of Community Wireless Structures, which develops
cell phone towers in Northern and Central Virginia. The
board of advisors includes Tony Coelho, a former
California congressman and chairman of Al Gore's
presidential campaign, and John Milliken, a former state
Secretary of Transportation.
has a two-pronged business strategy: It targets
employers and riders on the one hand, and retailers on
the other. Instead of advertising, which would recruit
riders from random locations, Steele is building
nodes, or concentrations of riders, around employment
centers. "We get people to join NuRide through
employers," he explains. "We know people are
going to the same place – we’ve already nailed one
of the variables."
first big employer the company signed up was America
Online. Then NuRide pitched major employers nearby like
MCI and Orbital Sciences, and filled in the little
guys in the neighborhood. The office node near Dulles
airport encompasses thousands of employees.
"We want to make sure that
people have a high probability of finding rides,"
Steele explains. So far, NuRide's track record is pretty good: About 30
percent of all ride requests result in a match.
other initiative is to line up retailers and other
businesses who want to connect with the company's
carpoolers -- or, as Steele refers to them, "nuriders."
In theory, NuRide provides retailers a highly targeted
advertising pitch: They can make special offers to
riders who drive past them on any given day. Taking a
slice of the advertising revenue provides NuRide with an
additional revenue stream.
is closing in on 100,000 total trips scheduled through
its service, and Steele is gaining confidence that he's
developed a winning recipe. "As
I said three years ago to my investors, we have eggs,
flour and sugar, but we don’t have a cake yet... Now
we’re getting close to having a cake. ... In
the next year, you’ll see our efforts really expand."
says NuRide is negotiating contracts to move into new
metropolitan markets. He won't say if any of those are
in Virginia, noting only, “NuRide’s
is strong and expanding.”
has more than 3.5 million workers; of those about 77
percent in 2000 drove alone; less than 13 percent shared
rides to work. (Others walked, biked, took mass transit
or worked at home.) If Steele can persuade one percent
of the go-it-aloners to share a two-way ride each
day, he can get 27,000 commuters off the road. That's
equivalent to adding a lane of Interstate highway --
each way -- for a
15- to 20-mile stretch, saving the state an expenditure
of tens of millions of dollars.
NuRide, with a little help from $3-per-gallon gasoline,
could wind back the clock all the way to 1990, it could get 60,000
motorists off the road. That's potentially worth
hundreds of millions of dollars in avoided costs to the
are the odds that Steele can achieve that level of
success? Frankly, I don't know. It depends on how
successful he is at building "nodes" of
activity, and what kind of luck he has convincing
retailers to try his unorthodox medium for reaching new
customers. It also depends on how seriously businesses
sell ride sharing to their employees, and what kind of
promotional muscle local and regional governments put
behind the program.
missing element, it seems to me, is the ability to
create "nodes," or clusters of riders, at the
residential end of the commute. Ride sharing loses much
of its allure if the driver has to travel 10 minutes out
of his way to pick up a passenger. By contrast,
carpooling becomes a more attractive option if the
commuters can rendezvous at a Park 'n Ride, or, better
yet, if they live within a walk or short drive from one
another -- a scenario that presupposes a density of
development not commonly found in Virginia's scattered,
cul de sac subdivisions.
won't solve Virginia's congestion problems by itself.
There are no silver bullets that will magically clear
the roads. But there are a host of demand-side solutions
-- from designing balanced communities where residents
can meet many of their needs locally, to equipping
employees to work from distributed locations, including
home -- that can reduce the stress on Virginia's
a few million dollars on experiments like NuRide looks
like a smart way for the Commonwealth to hedge its bets.
September 5, 2005