Minicabit’s latest move in adding Tesla cabs to its stable suggests what sustainable businesses have known for a while now: environmental sustainability is a guaranteed growth opportunity.

By 2020, a quarter of Minicabit’s fleet worldwide will be low and zero emission vehicles. As its first step in fulfilling this pledge, Minicabit has introduced zero emission Model S Tesla cabs onto its platform.

Minicabit CEO Amer Hasan explained why the sudden green focus, acknowledging the traditional slow uptake of sustainable technology in the taxi cab sector. “When I launched Minicabit in 2011, there was a definite lack of commitment to environmentally friendly initiatives in the cab sector. But as a start-up entering the taxi and mini-cab market, I considered Minicabit’s environmental stance as an investment in the future of our business from the outset,” he told Growth Business.

Hasan explained the company’s involvement in the Carbon Balanced programme by World Land Trust, so that every journey with Minicabit is carbon balanced. When booking a trip with multiple stops, its website automatically works out the best order of stops to achieve a lower fare and hence, typically, a lower carbon footprint.

The eco-start-up conundrum

According to Deniz Ucbasaran, Professor of entrepreneurship at Warwick Business School, attempts by start-ups to set up environmentally-friendly businesses are usually stymied by the interests of their investors, suppliers and customers. “Entrepreneurs passionate about green issues might need to be prepared for some soul searching,” she said. According to Ucbasaran, entrepreneurs with a green vision may feel disillusioned if their ambitions to make a difference don’t match with the reality of attracting investors and other stakeholders whose primary goal is making money.

For Hasan, it’s not an either-or situation. “Far from being a compromise, we found that our investors and partners – like Telefonica O2, and Heathrow Airport – are increasingly concerned with how our environmental initiatives enhance our overall service,” he explained.

Consumer demand

The company carried out a survey with Healthrow of 2000 consumers across the country. If all things, such as price and type of vehicle were equal, nearly half would book an eco-friendly cab. A further 9 per cent would actively look for one, suggesting an increasing demand for eco-friendly travel.

“The market has changed a lot in the last few years. There is a growing market of environmentally-conscious customers, so startups would be wise to incorporate ‘green’ practises into their business earlier, rather than later,” Hasan advised.

Recognition that the taxi-cab sector needs to evolve to become more environmentally friendly, has become widespread. The government has announced its vision for every UK vehicle to be an ultra-low emission vehicle (ULEV) by 2050. Specific initiatives such as the ultra-low emissions’ taxi scheme, have focused disproportionately on London. The capital constitutes just £2 billion of the overall £9 billion taxi-cab market and this approach does not address the entire problem.

Findings from an ethical consumer markets report by Ethical Consumer and Triodos Bank revealed that ethical sales in the transport sector grew by 26 per cent from 2013 to 2014 alone.

Customers who choose to travel in zero emissions cabs can book a Tesla through Minicabit’s app and website.

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