Dacsee touts a fresh ride-sharing model

Taxi-booking app Dacsee employs the multi-level marketing (MLM) model, helping drivers earn more through commission fees.

Taking its name from Decentralised Alternative Cabs Serving and Empowering Everyone, the blockchain-based ride-sharing platform is in the initial coin offering (ICO) phase with an aim of raising US$120 million (3.9 billion baht) in funds. Plans call for expanding to 20 countries in Asia-Pacific, including Malaysia, India and China.

Dacsee has reached out to regulators, the Office of Consumer Protection Board, the Bank of Thailand and the Department of Land Transport.

"Dacsee gathered people from the marketing field, cryptocurrency experts and software developers who are passionate about the ride-sharing economy," said Alexander von Kaldenberg, chief executive of Dacsee.

Thailand was chosen as the world's first country to launch Dacsee. The operations office in Bangkok will open in the first half of 2018 after recruitment of taxi drivers to the system and discussions with relevant authorities.

In addition, Dacsee has designed a platform called "government wallet" for Thai agencies to levy tax through an automated and transparent system.

Mr von Kaldenberg said Dacsee is a decentralised system that earns neither money from driver commission fees, nor extra fees from passenger bookings.

Taxi drivers must open their e-wallet to deposit money in Dacsee tokens before picking up a passenger. Taxi drivers can earn money at a normal rate from passengers without paying commission fees to Dacsee.

Moreover, Dacsee lets drivers recruit other drivers to create their own "fleet", modelled after MLM, earning up to three tiers of commission levels.

Unlike other ride-hailing companies that charge up to a 30% commission fee, the money in a driver's Dacsee e-wallet will automatically charge a 1-2% commission fee. All transactions are transparent and audited through blockchain technology.

The e-wallet and token can be converted to local currency; the drivers withdraw money from banks tied to their e-wallet and bank account.

"The app itself will earn money by increasing the value of a Dacsee token after they have customers in the network," Mr von Kaldenberg said.

A taxi driver who asked not to be named attended the Dacsee opening event and said he was not confident that the company's model is identical to MLM.

The driver used to drive for Uber and Grab, paying a 20-25% commission fee per trip to the companies.

"We are not a pyramid scheme, as the e-money held by taxi drivers and other stakeholders and taxi drivers still earns driving fees from passengers," Mr von Kaldenberg said.

Passengers sometimes cancel bookings because the car cannot arrive at its estimated time and taxi drivers need to pay a withdrawal fee from its wallet to the ride-hailing firm.

"If the pickup booking is lower than 100 baht, we ignore the booking because the net earnings is not too good compared with overhead cost," the driver said.

ML Nuttapon Devakul, chief executive of DMD Technology Co, a local partner of Dacsee in Thailand, said discussions with the Office of the Consumer Protection Board are needed to establish the app as legitimate for MLM.

"We might spend 40-50 million baht in the first phase of the application's launch," ML Nuttapon said.

Sanit Phromwong, director-general of the Department of Land Transport, told the Bangkok Post that the department is open to the technology but needs to verify Dacsee to protect consumers.

"As a regulator, we don't need any fee from Dacsee sharing," he said.