How Arcade City has continued to grow, despite a few run-ins with the law

Written by Kelly O'Halloran
Published on Dec. 06, 2017
How Arcade City has continued to grow, despite a few run-ins with the law
arcade city austin
photo via facebook

When Uber and Lyft pulled services from Austin following the city’s vote for stricter driver background checks in May 2016, other ride-hailing apps soon rolled into town to fill the void.

That caravan included local nonprofit Ride Austin, Fasten, Ride Fare and a decentralized network of drivers and riders using a Facebook group to direct services called Arcade City.

Arcade City seemed innovative at the time, giving drivers and riders the freedom to set and negotiate prices — and essentially run operations independently of a corporate entity.

But the City of Austin wasn’t a fan and tried to put the kibosh on Arcade City twice for not following proper regulations for transportation network companies (TNC).

The first attempt occurred in June 2016, when the police launched a sting against Arcade City drivers. The Austin Transportation Department said any individual or companies providing transportation services that charge more than the federal reimbursement rate of 54 cents/mile without proper documentation operate illegally.

The second effort occurred about a month later, when the police attempted to issue a citation against CEO and founder Christopher David for not having valid operating authority to run a transportation service.

However, the city has yet to issue David a formal citation, and Arcade City has chugged merrily along.

After making nice with the Texas legislature, Uber and Lyft returned to the scene last May, which led to Fare terminating service in Austin and many of the other companies taking a hit to their local market share.

Unlike competitors, David said Arcade City has continued to grow a local presence — while adding international markets along the way. Now, the company has released a new mobile app and opened its cryptocurrency token sale as it plans its scaling efforts.

“Our Austin network is humming along,” said David. “We’ve been growing gradually and steadily over the past 18 months. While other companies have downsized or given up with Uber and Lyft coming back in Austin, we’re still growing.”

Humming along might be an understatement. Arcade City Austin’s Facebook group has nearly doubled since its launch, with nearly 43,000 members and a daily stream of ride requests. David, along with three other individuals, act as the page’s administrators with seven of its top drivers serving as page moderators.

“We didn’t plan for this massive network on Facebook in Austin, but we’ve studied what has made it successful so that we can replicate it elsewhere,” said David.

The key, he said, lies in taking a step back and delegating control to the moderators. Now, he and his local team have started formalizing documentation to help scale this approach to other growing Arcade cities where users are forming their own guilds.

Take Cedar City, IA, for example: A city without any ride-sharing services. That is, until one driver “made some noise,” by printing out business cards and connecting with local bars to offer his driving services, David said.

“A local paper picked it up, and now you have ‘Arcade City brings ride sharing to Cedar City before Uber’ in the news,” said David. “We empower thousands of people to get things started. Users don’t have to wait for corporate to get things going and can begin forming their own networks.”

This includes larger network developments in countries like Brazil and the Philippines, where government regulations have interfered with the operations of Uber and other ride-sharing apps.

Just last week, the Philippines government suspended the motorcycle ride-sharing service Angkas, which supported 300,000 weekly drivers and users for operating without a mayor’s permit.

“Manila has some of the worst traffic in the world,” said David. “[Angkas] was a huge help in giving people an app that allowed for people to quickly hop on the back of a motorcycle.”

When Arcade City first entered the country in August, David said they, too, received a letter from the Philippines government requesting them to seize operations or else the app would be pulled offline.

David’s response, once again, was, “The law doesn’t apply to us.”

The app has yet to be pulled offline. Conversely, David said Arcade City’s new app has gained thousands of users and motorcycle drivers in Manila to fill the demand left behind by Angkas.

For now, David said the company is focused on rolling out technical infrastructure to make it easier for new markets to launch using cryptocurrency. Over the weekend, Arcade City also opened its sale of 10 billion Arcade Tokens which will close at the end of February.

“We’re building a template on how to form a network, how standards rise over time and adding technology to smooth out the process,” said David. “It’s hard to say where we’ll be in six to 12 months. There’s no blueprint for what we’re doing.”

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