Stories
As you read this article, New York’s Metropolitan Transport Agency (MTA) is embarking on a one-year pilot project to optimise the way it runs its bus fleet. The MTA will try out new ways of scheduling a few hundred buses at first, in Manhattan and the Bronx, as traffic recovers from the pandemic. It has received funding from the New York State Research and Energy Department to see if the experiment can also generate environmental benefits.
The contractor helping the MTA plan its bus use more efficiently is CitySwift, a public transport data analytics start-up founded in Galway six years ago by Brian O’Rourke (31), now its chief executive, and Alan Farrelly (30), chief commercial officer. “That’s an absolutely massive milestone for us to be doing public transport in New York. It’s huge for us,” Farrelly told The Currency. “We’re the first external company integrating into the data of the MTA,” O’Rourke added.
Buses and computers were already at the centre of O’Rourke and Farrelly’s lives when they met in secondary school in Co Longford. They didn’t know at the time this would translate into a software business now applying artificial intelligence (AI) to the millions of data points constantly generated by bus fleets on both sides of the Atlantic – and raising funds from investors including Ryanair’s founding family.
To understand how they got to this point, I visited them at CitySwift’s new office, which overlooks a row of busy bus stops on Galway’s Eyre Square and can accommodate the company’s growing workforce. O’Rourke says it has jumped from 14 to 55 in the past two years. Off the vast open plan, the kitchen is signposted with a licence plate labelled “Fueling station”.
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Farrelly logs into CitySwift’s web-based application, which visually reminds me of Google Analytics. He picks a real bus route in Birmingham and displays a dashboard showing its recent punctuality curve, passengers’ details and how it benchmarks against the rest of the city’s network.
In a few clicks, Farrelly then launches the optimising tool, which recognises patterns to propose a new schedule. This comes with a cost analysis of the savings expected from the changes and an export file compatible with the city’s existing scheduling software. “This takes two minutes instead of two weeks working with Excel sheets,” he says. “It is also 10 per cent more accurate than a human.”
O’Rourke translates the demo into CitySwift’s elevator pitch: “We’re a specialist data engine, and what we specialise in is optimising urban bus networks using AI,” he says. “We’re collecting raw data from different silos that had never been connected before. We turn that raw data into insights and actions that urban bus operators can use to optimise their network. The end results, as well as the return on investment for our operators and our clients that are using their systems, is an increase in operational efficiency and in the punctuality of the service.”
The “silos” mentioned by O’Rourke range from positions transmitted by each bus’s GPS to the passenger data recorded every time a person buys a ticket or uses a smart card. CitySwift throws in additional information on weather, road works, school holidays and events such as big football matches. Crucially, its technology is designed to integrate with the software already used by fleet managers, from scheduling tools to passenger apps – there is no need for a customer to rip out existing systems before it can start using the company’s services.
Farrelly points to the bus stop on Eyre Square, where a number of vehicles are parked after arriving early to make sure they start their route on time. “We can calculate how long they actually need to wait,” he explains, with the potential for resulting savings adding up quickly. “The cost of one bus, per year, is £200,000 to £250,000. So, if you save between 1 and 2 per cent, and there are 5,000 or 8,000 of them with one operator, it becomes big numbers.” The reason he counts in pounds is that CitySwift’s market to date has been mostly in the UK.
These types of questions would never cross the mind of the average passenger, but they come naturally to Farrelly, who was born into a bus business in Keenagh, Co Longford. He says his parents bought their first minibus 35 years ago and have since expanded to a fleet of 40 buses and a dealership importing the vehicles from China. “We would have served all the dancehalls for the Reynolds family of former Taoiseach Albert and all the rest of it,” he says. A licensed bus driver himself, he drove and became involved in the business from a young age. “The kitchen table was a boardroom,” he remembers.
Meanwhile, “I was over playing with computers on the other side of the village,” says O’Rourke – “originally kind of taking them apart and putting them back together, sometimes more successfully than others”. The pair met in school as teenagers and O’Rourke went on to study information systems and business, while Farrelly worked in the family bus business after finishing college. They did, however, maintain contact, and began to work together.
“I’d love to say we set out with the idea that we were going to fix New York and London and Birmingham’s public transport networks,” says O’Rourke. “But it started with a lot more humble ambitions to optimise Alan’s family business.” As they struggled to transform their ideas into a scaleable business, he says they were “very lucky” to be introduced to Robert Montgomery, then the managing director of the leading UK bus operator Stagecoach.
“What we learned from Robert after that meeting was the ins and outs of the UK bus industry and Stagecoach, but also how they hadn’t really adapted to using data to make any operation and efficiency improvements, or improvements to the passenger experience or service levels.”
Farrelly adds that, although Montgomery initially tried to offer them jobs, he and O’Rourke decided there was an independent business to be developed selling these services to the large companies controlling the bus transport industry in the UK. Since the privatisations of the Thatcher era, the sector has consolidated into five major players: Arriva, First Group, Go-Ahead, National Express and Stagecoach. “We have commercial relationships with them all,” says Farrelly – at different stages of advancement.
The pair also found later that targeting the UK market was necessary to bring investors on board, with Ireland considered too small to grow CitySwift’s business. As for Montgomery, who left Stagecoach in 2017, he has since invested in Huddl Mobility, the company behind CitySwift, and joined its board.
As O’Rourke and Farrelly developed their product and began to look for backers in 2016, they found that all the interest was in individual transport solutions like Über, Hailo or MyTaxi. “There was not much VC interest in public transport technology companies,” says O’Rourke. CitySwift did, however, get support from Enterprise Ireland and participated in an accelerator programme, which put its founders in touch with Declan Ryan.
“They had seen what had gone on with the digitalisation of the airline industry, the advancements they’d made to efficiencies in the passenger experience and to profits because of it.”
Brian O’Rourke
The son of Ryanair founder Tony Ryan and head of the resulting investment firm Irelandia Aviation understood CitySwift’s potential. Referring to the buses idling at the bus stop outside, Farrelly contrasts them with Ryanair’s famous 20-minute aircraft turnaround. O’Rourke adds: “Irelandia’s outlook on our system was the marginal gains that could be got from the system. They had seen what had gone on with the digitalisation of the airline industry, the advancements they’d made to efficiencies in the passenger experience and to profits because of it. And I suppose they could see from speaking with us that public transport and buses were way behind where the airlines were and this was an opportunity for us.”
Irelandia was on board and its investment director Michael Lynch now sits on Huddl Mobility’s board. This break also opened the door to other investors. To date, the company has raised a total of €3.5 million in two rounds after Ryan’s firm, Montgomery and Enterprise Ireland were joined by ACT; the Western Development Commission; and former CarTrawler chief executive Mike McGearty, who has become Huddl’s chairman.
The funding kick-started a period of “hypergrowth” over the past two years, says O’Rourke, who expects the same pace to continue in 2022. Turnover has grown 12-fold to hit a “six-figure monthly recurring revenue,” he adds, without revealing the exact amount.
While the pandemic has hit passenger revenue, he says governments have responded with subsidies and the cash squeeze has made bus operators more acutely aware of the need for efficiency gains. As Covid-19 threw established travel patterns up in the air, he adds that “the amount of change has opened bus operators’ eyes to the need for predictive AI”.
Meanwhile, CitySwift has polished its product, with O’Rourke saying the six months required to plug into the data sources of its first customer have now shrunk to two weeks.
Thanks to its established contracts with leading British PLCs, CitySwift is now targeting those local governments who run their own bus systems and are traditionally more prudent in adopting new technologies. Taoiseach Micheál Martin announced the company’s first such public contract with Transport for Wales during a visit to Cardiff in November.
After New York, Farrelly says his next sales targets are in France, which is home to three major international bus operators – Transdev, Keolis and RATP – as well as in the Middle East and Asia. “The next phase of our growth is more B2G [business-to-government] revenue, expansion within our B2B revenues, and entry to key markets to give us global access – France and probably Spain,” he says.
As for Ireland, the National Transport Authority and bus operators including Dublin Bus are also on Farrelly’s radar, but nothing has happened yet. He says existing British customers of CitySwift may also end up operating in Ireland if they win tenders to operate routes here.
To support its growth, CitySwift’s main investment has been in people. Its recruitment drive has been across what Farrelly describes as “a mix of industry and cutting-edge tech”. To connect with customers, the company has been poaching experienced bus network professionals and making them work side-by-side with software engineers.
“One of the reasons we’re really excited to be based in Galway is the amount of languages that are accessible here,” Farrelly says, with hires now tailored to support international expansion. On the tech side, I ask O’Rourke how he finds competing with employers including deep-pocketed multinationals in Galway and nationwide for people he describes as “the top 1 per cent of graduates”.
He says the pull of “tech for good” helps with CitySwift’s recruitment. “We’re an exciting tech company, delivering on a really measurable problem and executing on that. Graduates can come into our business and see the impact they’re making over a period of weeks, months. And I think the learning curve that they get is astronomical compared to, maybe, if they go into a larger corporate.”
As our interview draws to a close, I ask CitySwift’s founders two related questions. Why did they choose to focus solely on urban buses? And does public transport really have a future, when we are bombarded with monthly announcements from Silicon Valley about the next start-up that will make it obsolete with any combination of apps, hyperloops and flying cars?
O’Rourke’s view is that, as governments scramble to tackle traffic jams and pollution in cities, more and more will introduce congestion charges like London while bus-related investment will boom over the next decade in anything from electrification to dedicated lanes and priority traffic lights. “Decarbonising, improving and expanding public transport is one of the most powerful and immediate levers we have to reduce greenhouse emissions,” he says.
O’Rourke predicts that a parallel development will be the sophistication of bus networks into more intelligent fleets, with vehicles of different types and sizes operating where and whenever needed, to timetables that will ultimately evolve in real time to match passenger demand. He also sees CitySwift expanding beyond buses as integration with other modes of transport, from trains to electric scooters and traditional cars, becomes increasingly important in each passenger’s journey.
As for flying cars, O’Rourke remembers: “We used to go to venture capitalists in 2016, 2017, 2018 and they said they wouldn’t invest in us because by 2020, every car in the city was going to be driverless. I look around and I don’t see too many driverless cars.”
While he thinks these technologies will ultimately develop, he can’t see them replacing public transport: “At the end of the day, to move the masses of people around cities, there is only one way to do that in a sustainable way [where] there’s a limited amount of road space and in an efficient manner. And that is by using public transportation.”
Farrelly adds that his and O’Rourke’s rural background helps them realise that new forms of transport such as autonomous vehicles are an even longer way off from reaching outside cities, leaving another whole field open for the development of more efficient public transport. “There’s a huge amount of vehicles, there’s a huge amount of infrastructure in front of us. It just needs to be optimised,” he says. “I think that’s a huge opportunity for us to do that.”
