A teenager with a nose for business and luxury cars has brought his ridesharing startup, Tesloop, to Southern California’s crowded roadways.
For a nominal fee, customers ride in swanky electric Teslas while plugged into work, music or Instagram. A “pilot” navigates dedicated routes between Los Angeles, Orange County, San Diego County and Palm Springs.
The cost? Almost too good to be true.
A route between L.A. and Orange County starts at $29. Seats from Orange County to San Diego? $39.
Haydn Sonnad was 16 when he conceived the idea for Tesloop two years ago. The teen graduated from Agoura High School in June.
“I had the idea back in May 2015. It was almost summer going into junior year. The idea was to lease out a Tesla car and drive people back and forth to Vegas on the weekends to make up for the lease payments,” he said.
So, how does a teenager start a ridesharing company with the likes of Uber and Lyft circling nearby? Sonnad got help from tech experts, including his father, Rahul Sonnad, who holds the title of Tesloop CEO, and company vice president Brian Skipworth.
“He was really skeptical at first, but after about a month, jumped on board and helped me develop a team,” Sonnad said of his father’s interest.
Sonnad’s father has a thing for startups.
The Harvard Business School grad founded his first company, The Platform in 2000. It offered an “industrial-strength online video management system” used by Verizon, Microsoft, Hulu, Qualcomm and Comcast. He also founded Geodelic, which created location-based content and commerce services used by Verizon, Universal Studios theme parks, and Korea Telecom. Sonnad also worked as an engineering manager at Adobe and at Microsoft.
Haydn Sonnad said driving in Southern California was a “really intensive permitting process,” which is why he started the service between California and Nevada. Now that he’s licensed for business locally, he’s focusing on Southern California.
He said he spent $7,500 to get the first Tesla, plus its monthly lease cost. After about a month in business, he got angel investors to boost the bottom line.
The company would not disclose how much money it raised from investors in 2015 and 2016 but said it raised seven figures in a seed round from Santa Monica-based Clearstone Ventures and San Francisco-based Inspiration Ventures. It has also raised “substantial amounts” from Las Vegas-based Trust Ventures.
Tesloop said it will operate at a “near break-even” level for the next few years.
The startup has roughly eight full-time employees and 30 drivers, who are independent contractors and earn an hourly wage and bonuses. Drivers undergo background checks and are trained on how to drive Teslas. The company fleet includes a Model S and seven Model X SUVs.
Pilots make 12 daily trips between LA and Palm Springs; eight trips between San Diego and L.A.; and six between Orange County and L.A. More trips in Southern California will eventually be added, he said.
Tesloop, Sonnad said, has completed more than 3,000 trips since its launch.
Brand loyalty
In a technological age, it wasn’t too hard for Tesloop to find customers. Sonnad first used Craigslist to fill up his seats. Now his five-star Yelp reviews keep the company busy.
Clients include college students and business travelers, according to the company. Most book a seat, not the entire car. In the Model X, that can mean sharing the SUV with three other people.
Tesloop travelers can book a one-way seat for as little as $29 or the full car for $116. The company sets pick-up and drop-off locations, so there is no door-to-door service. Pick-up and drop-off sites in Orange County include Anaheim, Brea, Costa Mesa and near John Wayne Airport. The company has several sites in Los Angeles, including Downey, Hawthorne, Culver City, Pasadena, Long Beach, downtown LA and more. It was recently approved to operate out of LAX.
Los Angeles resident Melanie Adler has been using Tesloop every two weeks since September.
She books the service from Los Angeles to Palm Springs for business.
“The pilots are great. The experience is phenomenal,” she said. “It’s affordable, the customer service is superb, and it’s sustainable since it’s a Tesla.”
Barbara Kurzman, of Palm Springs, used Tesloop a year ago to get from Palm Springs to downtown Los Angeles. Each way costs less than $40, she said.
“It was fun,” Kurzman said. “The car was terrific. The driver was great, and the other passengers were interesting.”
Few customers at Yelp have dinged Tesloop. Complaints range from delayed drivers to a bumpy ride.
One customer, who still gave the company a five-star review, said his car stalled 20 feet from the charging station in Barstow, a pit stop once used for the car and its passengers en route to Las Vegas.
Dustin Stevenson who was on his way from Las Vegas to Los Angeles said the car died just feet from a Tesla charging station and had to be towed, adding a few hours to Stevenson’s trip.
“It wasn’t unreasonable for them to think they could make it (to the charging station),” he said. “The driver said that the vehicle we were in had been having some issues with the battery. It heightened the risk that they chose to absorb by sending that vehicle on a route in 5-10 miles of the range of the battery.”
Because of the inconvenience, he and the other passengers were dropped off at their homes instead of a central location and he was given a refund.
“The overall service was interesting, but maybe in the right circumstance something I would do again,” Stevenson said. The driver, he added, handled the situation very well.
What’s next?
Now that high school is over, Sonnad plans on taking a full-time position at the company while taking a gap year before starting college.
The teenager, who chose the all-electric Tesla for its range and autopilot function, sees a future in which Tesloop is operated mostly by the car while passengers ride along — with one at the wheel.
“Tesla is the leader in electric autonomous cars,” Sonnad said. “No one comes close to competing with them.”
The young ridesharing industry shows no sign of slowing down. According to Modest Money, the industry generated roughly $3.3 billion in revenue in 2015, and annual revenue is expected to top $6.5 billion by 2020.
For Tesloop, expansion is everything. More routes in Southern California, including San Bernardino, are being considered and the company hopes to one day expand to other regions as well.
Interested customers can book a seat at tesloop.com or by calling 818-330-6446. An app is also being developed.
