Careem Co-Founder Mudassir Sheika on Fueling the Growth of Saudi Arabia's gig economy

Mudassir Sheika, co-founder and CEO of Careem, a pioneering ride-hailing company in the MENA region, unpacks the growth of the gig economy in Saudi Arabia, as the region experiences rapid social change.
Mudassir
Sheikha
29 Mar 2022

Across the Middle East, economic development is fragmented. Some countries are moving at breakneck speed towards a digital future, investing in entrepreneurship and innovation to nurture the development of new technologies that will help improve lives. In other countries, people continue to face serious daily friction that much of the world has long forgotten about, and which holds them back from reaching their true potential.

One thing that has grown fairly consistently across the region is the gig economy. Since transportation-based services and asset-sharing platforms launched in the region just over ten years ago, they have grown rapidly in popularity and opened up flexible earning opportunities for millions.

The gig economy will be critical to bridging resourcing and talent gaps across a range of industries to build more efficient and resilient economies. This will help to counter an increasingly challenging economic environment which has led to rising inflation globally and significant currency devaluations in countries like Egypt and Pakistan.

In the wider Middle East, the growth of ride-hailing in particular has had a huge positive impact both economically and culturally. One of the most interesting benefits has been the acceleration towards digital payments in a region that has historically relied heavily on cash. Part of the reason that Careem was able to expand across the Middle East so rapidly in its early days was because we became the first ride-hailing player in the region to accept cash payments. Since then, the percentage of rides using digital payments has increased from 19% in early 2016 to 51% in February 2022.

Careem has created earning opportunities for over 2 million registered Captains whilst helping to reduce urban congestion in over 100 cities across the region. We never imagined how popular ride-hailing would become in a country like Saudi Arabia, where most households have personal drivers and people weren’t used to sharing personal details through an app to hail a ride. But the openness to change was remarkable, particularly for women.

Before Careem entered Saudi, women would rely on a driver or male guardian to get to work or travel around. Ride-hailing soon became one of the most popular ways for women in Saudi Arabia to move around while feeling safe doing so, making it much easier for them to participate in the workforce. Saudi is now Careem’s largest market, with over 250 million trips completed to date. And some of the 75,000+ Saudi nationals that earn via Careem as ‘Captains’ (what we call our drivers) every month are female.

Ride hailing gives a broad cross section of Saudi society an opportunity to earn flexible income on their own terms. Nearly one in five Careem Captains in Saudi Arabia were unemployed before signing up. And over 80% of them drive fewer than 40 hours each week. The majority of Saudi Captains are young (76% under the age of 40) and more highly educated than the overall population (76% have completed their post-secondary education and 34% have completed an undergraduate degree or more).

In 2022, demand for ride-hailing is growing again as cities come back to life and people can’t wait to get out and about. Saudi Arabia is alive with record turnouts for some of the region’s most popular events, from Riyadh Season to the 2022 Saudi Arabian Grand Prix in Jeddah.

Demand is so high that, like many other parts of the world, there is now a supply crunch. The number of gig workers active today is still not where it used to be before strict quarantines during the pandemic drove Captains to look for alternative sources of income, limo companies to sell their fleets, and car manufacturers to pause production.

To get supply back to where it used to be, we need more Captains to sign up to marketplace platforms. The opportunities for ride-hailing Captains to earn while maintaining flexibility are now greater than ever. Earnings by Saudi national Captains on Careem in 2021 alone totalled over SAR 430 million ($115 million).

Our Captains are the front line of our business and critical to everything that we do. This is why we provide them with a thorough onboarding when they join and schedule regular focus groups and training to make sure they are comfortable with our platform. We’re excited to make gig work accessible to more people as it contributes towards building more resilient economies in Saudi and beyond.

Mudassir Sheikha

CEO & Co-founder | Careem

He started his career with Trilogy Software before joining San Francisco-based mobile experience startup Brience at… More