After a very difficult year, Groningen based scale-up Parkos is breaking records again. The platform for finding, comparing and booking parking spaces at and near airports had a record turnover last July. And the month before that was the best in the company’s history in terms of bookings. But the road to new growth was far from easy.
Parkos was founded in 2016 and is currently active in14 different European countries, and also in Australia and the US. Before the pandemic the scale-up was one of the fastest growing tech companies in the Netherlands, featured in both the Deloitte Fast 50 and FD Gazelle rankings. We sat down with co-founder and managing director Arne Bos, to talk about overcoming uncertainty, difficult choices, focus and perseverance.
How did you come up with the idea behind Parkos?
“We started as a travel blog way back in 2006, about all sorts of useful things, ranging from hotels in Spain to restaurants in Sweden. At one point, we added a page about airport parking near Schiphol. Plane tickets and hotels were getting cheaper, but airport parking was still really expensive, because airports were still the sole parking lot providers. But then a lot of private companies with land or real estate around Schiphol Airport started offering parking spots with shuttle transfers and the market really exploded.”
“But that booming market was anything but transparent for consumers and you had all these horror stories on TV, with these companies actually parking your car at free and unsupervised supermarket parking lots, damages to cars etcetera. We wanted to add a little transparency by providing information about fair prices and safe parking spaces and with that, we saw an opportunity to turn it into a business. So in 2016, we made the switch from travel information to a parking platform.”
And when did you decide to go international?
“It was a gradual process and a logical next step for us. In our industry, the biggest companies tend to survive and the smaller ones don’t, so we’ve always focused on growth. And because of extra airfare taxes in the Netherlands, a lot of Dutch tourists started booking their flights from airports in Germany and Belgium, because it was cheaper. So we started contacting the parking providers around those airports, offering to take care of the marketing for the Dutch tourists, as well as translating all of the necessary information. Things just grew from there.”
“Because we work on a commission basis for each booking, with no-cure-no-pay for facilitators, many of them signed on and we were able to scale up fast. We started registering websites in Germany and Belgium, then France, Italy, Sweden and so on. In 2019, we also became active in the US and Australia.”
What were the biggest challenges in going abroad as a company?
“We were a little naive at first, so we learned a lot during the first year. Germany is very different from Belgium and the Netherlands in terms of what kind of information you have to provide. And whereas Dutch tourists are mostly interested in pricing, Germans care a great deal more about safety and travel distance for example. But we were able to take these lessons to every new country we became active in. One thing that really helped was hiring native speakers. If parking facilitators can ask questions or discuss things in their native tongue, it really helps to build trust and a good working relationship.”
And then, after years of growth, international air travel came to a standstill....
“It’s been a really difficult year. We first noticed it in Italy in February last year and still had some hopes the rest of Europe and the world wouldn’t be as affected. And then in March, the day after the Dutch prime minister’s press conference, cancellations skyrocketed and bookings dwindled and every other country we were active in followed suit. For the first couple of months after that, with the help of government compensations, we were able to manage things like personnel costs.”
“We had some hopes for that summer and things did get a little better, though nowhere near the year before, but then in September and October, bookings died down again. That’s when we had to make the incredibly difficult choice to let people go. Some of them had been working with us for years and did an incredible job and now you suddenly have to tell them: sorry, but this is where we have to part ways. We tried to help them as much as we could, with introductions, their resumes or letters of recommendation. But still, I wouldn’t wish on anyone to be in that position.”
But you managed to stay afloat and persevered.
“We did, fortunately. And it was also a very deliberate decision to keep focusing on what we already did, because we knew people would start flying again. So we focused on further developing our platform, finding ways to automate our marketing campaigns and we invested a lot of time in attracting new parking facilitators. We basically took all the time we had to make sure everything was ready to go on our end.”
“So when travel restrictions started to lift in Europe in May, we were able to reap the rewards of our work. Even though air traffic is still nowhere near up to full capacity and may never be again, we’ve had our best month on record and we’re growing again. And hopefully, we can continue that level of growth and scale up further.”
What’s next for you guys? Anything cool on the horizon?
“Where we used to focus mostly on sales, we’re now focusing more on the product, which is our platform and really take that to the next level. We recently hired a new Head of Development for that and are currently looking for UX/UI designers, product-owners and full stack developers to join our team.”
“We’re also working more with airports directly too. The official parking of Eindhoven Airport teamed up with Parkos and so did Toscana Aeroporti in Italy, which is great news. Another step we’re currently taking is growing further in the US. We already started doing that in 2019, but it takes time to find your way in the market and also the culture. In Europe for example, pricing is very transparent when you compare it to the US. It’s not common practice there to include VAT or other fees, which feels weird for us as a company. So how do we market ourselves? There’s still a lot to figure out, but that’s also part of the fun!”