After reaching profitability, carpooling platform BlaBlaCar secures $108 million debt line

BlaBlaCar is an iconic name in the French startup ecosystem. The carpooling and bus ticketing company has been around for so long that it’s hard to consider it a startup anymore. Still, BlaBlaCar is an extremely interesting company today due to its unique trajectory.

What started as a scrappy online hitchhiking community became a startup that raised hundreds of millions and reached unicorn status. It then expanded to many countries across several continents, then scaled back its ambitions and started to think about profitability.

Today, the company is announcing that it’s secured a €100 million revolving credit facility ($108M at today’s exchange rate). This will give it a new war chest to plan for the future and keep driving for growth — including through acquisitions.

“Debt is a tool that’s relatively attractive, non-dilutive, and super flexible too,” Brusson told us. The €100M credit line is with several big banks based in France, the U.K. and the U.S.

BlaBlaCar isn’t paying any interest for now as it has not tapped its debt line yet. But Brusson said plans to use that debt facility to acquire smaller companies. As many startups are struggling because they can’t raise their next funding round, BlaBlaCar will be able to step in and acquire these smaller companies.

Profitable for the past 24 months

While BlaBlaCar isn’t a public company, it is slowly accepting the fact that it can share some metrics more publicly. This way, BlaBlaCar can reveal for the first time that it has reached profitability — in fact, it has been profitable since April 2022.

The milestone must come as a huge relief as 2023 has been a challenging year for French startups — except if you work on artificial intelligence products, of course.

“The whole business is profitable. We’ve been profitable for almost two years,” co-founder and CEO Nicolas Brusson told TechCrunch. “2022 was the first almost full year post-COVID, except for maybe the first two months. We recorded €195 million in revenue. And we ended up basically slightly negative for the year, but that was really because Q1 was horrible.”

“But from Q2 2022 and onwards, we’ve been profitable. Then, in 2023, our revenue jumped to over €250 million. So we’re experiencing a little bit less than 30% in top-line growth and we’re still profitable.”

Profitable can mean different things to different people. Many companies like to claim they’re profitable even though they’re talking about EBITDA — a financial metric that doesn’t take into consideration the costs associated with a company’s assets. And Brusson is a bit fed up with companies pretending to be profitable and that are actually losing money every year.

In BlaBlaCar’s case, the company has been profitable on an EBITDA basis, but also generates net profits when you take everything into account — BlaBlaCar doesn’t own any cars or buses anyway.

In 2023, 80 million passengers booked a bus or carpool ride on BlaBlaCar. And the good news is that there are BlaBlaCar users all around the world — not just France.

“Brazil is bigger than France in terms of the number of users. And I think that India will be bigger than France for the number of carpool rides next year,” Brusson said.

The company hasn’t started monetizing its users in India, Brazil, Mexico or Turkey yet — it doesn’t take any cut on carpooling transactions. It will progressively add booking fees, which will also help when it comes to growing the company’s revenue.

One wrinkle is Russia. When the war in Ukraine started, BlaBlaCar had millions of users in Russia. While many tech companies decided to sell their Russian subsidiaries, BlaBlaCar’s Russian activities have been completely segregated from the rest of the business but BlaBlaCar doesn’t plan to sell it. Brusson argues this would be counterproductive as it would essentially mean giving it away to a Russia-based owner.

“Today, it represents just under 5% of revenue, so it’s pretty small. It’s still part of the group, but it’s completely isolated and managed independently… The company is totally carved out from the group. But if you want to sell it, in the current context, it’s like giving it away.”

Adding train tickets

In Europe, BlaBlaCar wants to aggregate all ground transportation methods. In addition to carpooling and bus rides, the company plans to add train tickets. Users will be able to buy tickets at some point in the next year or so.

“The idea for us is to combine it with carpooling. So we’ll be able to offer journeys with train plus carpooling — almost door-to-door,” Brusson said.

Even if you don’t book your next train ride on BlaBlaCar, the company is also experimenting with last-mile carpooling. “In that case, we have a different model for slightly shorter distances. The idea is to connect train stations with your destination. Typically, if you arrive at Vannes station, you often need to get to your grandmother’s house, your vacation home, your weekend getaway. You still have between 10km and 40km to go,” he noted.

As there are already many BlaBlaCar users who are driving in that direction, the company will ping those drivers to see if they can pick up a group of people at the train station and drop them off at their destination.

In non-European markets, bus rides represent the biggest opportunity. “The good news for us in these markets is that bus remains a very offline and fragmented industry,” Brusson said. He pointed out people spend billions of dollars on bus tickets in India and Brazil — suggesting that, once again, there’s room for BlaBlaCar to grow.