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Harrogate is not short of genteel visitor attractions – including its invigorating water, a renowned, if geographically anachronistic, Turkish baths and close proximity to the Yorkshire Dales National Park. But as from this week, the Yorkshire spa town might also prove a bit of magnet for techies in search of working example of “smart city” technology.
Using technology provided by U.K. tech startup AppyParking, Harrogate Borough Council and the North Yorkshire county authority have launched an innovative “one-click parking” solution, which essentially enables motorists to locate free spaces and pay through an automated system. The solution uses a range of technologies, including number plate recognition and sensor-driven payments.
The concept is relatively simple. AppyParking has installed around 2,000 sensors within the Harrogate area. When a motorist pulls up and parks, the equipment identifies the car and bills the driver, according to the length of the parking session. In addition, the app that delivers the consumer-facing experience provides details of available spaces in real time. In theory at least, the system will cut pollution by reducing the amount of time that drivers spend searching for parking spaces.
But what about the execution? How does a startup position itself as a provider of software and kit to cash-conscious local authorities while also raising money to buy some expensive equipment?
At heart, AppyParking is offering a software platform that coordinates the parking experience for consumers while allowing local authorities to manage their assets more effectively. But around that platform, there is a lot of very necessary hardware and infrastructure. When I spoke to founder and CEO Dan Hubert, I asked him about the challenges of building a business, which he cheerfully acknowledges, is “capital intensive.”
AppyParking was born out of Hubert’s own experience. “Driving in London was a constant frustration,” he recalls, not least in terms of finding places to park in a city of very crowded streets. His idea was to digitize the process, starting with a personal project to make electronic maps of UK cities. In 2013, he quit his job in advertising to set up the company.
But building a platform around electronic maps represented only a small part of the challenge. One important catalyst in the company’s development was a partnership with Visa. Best known as a credit/debit card company, Visa was also supplying a payment system for Transport for London. After talking to Hubert about his parking plan, Visa agreed to provide both a payment solution for the parking app and some money to buy sensors.
The Power of Corporate Partnership
And as Hubert explains, corporate partnerships and investment – rather than VC cash – has provided the wherewithal to turn his vision into reality. “Raising finance for a capital intensive project can be brutal” he says. “The UK is very risk averse.”
As he sees it, VC funds are keen to put money into software-based projects but much less willing to back business models that involve hardware. “That’s why we have seen corporate venturing as the way forward,” he says.
In addition to Visa’s support, AppyParking secured £2.3m in 2017 from insurance giant, Aviva and Breed Reply. In the case of Aviva and Visa, Hubert says the business plan of the startup aligned market solutions that the corporate businesses wanted to address. AppyParking has now engaged in the second stage of a Series A round.
Partnering also raises technical issues. As Hubert points out, parking and payment solutions are offered by a broad range of organisations. To succeed, the platform has to provide a technology-agnostic hub that allows disparate systems to connect.
In addition to attracting corporate backers, AppyParking has also had to convince local authorities of the merits of its business model. That in itself can be a complex undertaking. For instance, in the case of Harrogate, two tiers of local government – the town and county councils – manage different assets.
But the selling points are the same – efficient parking will boost the economy of a town or city. “The biggest block on people coming into a town is parking,” says Hubert. “Our mission is to improve transportation.”
The logic is that if drivers know they will be able to find free parking areas and make payments delineated in minutes or seconds, they are more likely to travel into the center of towns, boosting the economy. And if the system is efficient, less time will be spent finding free slots, cutting down on pollution and congestion. Over time, the system will also provide data that can aid traffic planning.
That’s the theory, but will it work? Well, Hubert says that after Harrogate, other cities are coming on stream with “one click parking, including Worcester, Portsmouth, Dundee and Halifax. Hubert envisions a nationwide service. It’s an ambitious plan for a relatively youthful company.
January 30, 2019 at 06:12AM
Forbes – Entrepreneurs