A Valley ride-hailing startup has launched a crowdfunding campaign that allows the community and the company's drivers to invest in its next phase of growth.
HUM rolled out its community round of funding Jan. 17 via crowdfunding platform EquityVest with a goal to raise a minimum of $500,000.
“This is providing an opportunity for drivers to invest in their future and the success of HUM," Chris Kolb, co-founder of HUM said. “It's an opportunity for the community to invest in its own future as the birthplace of rideshare done right.”
Capital from the crowdfunding campaign will be used for marketing and improvements to HUM’s technology, contributing to the company's growth throughout the Valley, said Kolb, who primarily bootstrapped HUM with his father, Garrett.
“The purpose of this crowdfund is to gather the capital and redeploy it back into the community via marketing and technology, so we can offer more rides, grow our presence and the company," Kolb said. "... These funds are the way that we get to go out and help people. We help drivers earn more money, put them back into a position of power and help them reclaim a sense of pride in their work."
Phoenix-based HUM describes itself as the ride-hailing industry’s first “user-centric platform,” allowing drivers to keep 100% of their fares through its subscription-based model.
HUM validated the proof of concept for its ride-hailing app in February 2023, when Phoenix hosted the Super Bowl LVII and the WM Phoenix Open. That same month, the company launched a beta version of its app in the Valley and Tucson.
Since then, more than 4,000 drivers and riders have joined HUM’s platform. HUM also partnered with several Valley hotels, resorts and restaurants to offer discounts for guests using the company’s ride-hailing platform.
In addition, HUM partnered with the Cronkite Agency to create a marketing campaign. The Cronkite Agency, which is part of Arizona State University’s Walter Cronkite School of Journalism and Mass Communication, provides local and national clients with a variety of services, including public relations, digital marketing and social media campaigns.
HUM has its sights set on scaling its platform in 2024 by boosting brand awareness and building upon its established partnerships with the Valley’s hospitality industry.
“I'm really confident that we've done the work to build up the strong foundation of which we'll be able to grow on successfully during 2024,” Kolb said. “As a team, we’re committed to consistency in all that we do. We show up every day for our drivers and users. We want to provide the most meaningful experience from A to B and make sure you're getting there safe."
Crowdfunding can be 'a great retention tool,' co-founder says
HUM’s crowdfunding campaign comes amid a slowdown in venture capital deals nationwide and in Arizona, according to recent Pitchbook data.
In the fourth quarter, Arizona companies inked 31 deals totaling $232.5 million, compared to 39 deals and $458.2 million raised in the fourth quarter of 2022, according to a Pitchbook report.
Kolb said crowdfunding can be a “great retention tool” for companies by providing an opportunity for workers to be part of it.
“Once you're an investor in the company, you’re one of the greatest advocates for that company to grow,” he said. “You're going to be backing it and you're going to be telling your friends about it. So I do believe that crowdfunding is a great tool for this.”
Kolb, however, advises startups to consider setting up crowdfunding campaigns with terms that keep the door open for venture capital investment.
“You want to be on the lookout for making sure that your company is going to succeed and is going to last through tough times. Setting it up with the right terms is important," Kolb said. "You have to do your due diligence as a founder to use this as a tool appropriately, so you’re still available to potential institutional investors down the line.”
