Challenge

As an on-demand marketplace, Lugg works hard to keep both its customers and its service providers happy. For customers, Lugg has to be able to dispatch drivers and helpers extremely quickly - as soon a customer requests a pickup, drivers and helpers need to be ready to go. For helpers, Lugg needs to make it easy to sign up and get paid quickly and accurately. The more satisfied drivers and helpers available on the Lugg platform, the faster Lugg can respond to customer requests and keep both sides of its marketplace happy.

Before Stripe, onboarding new drivers and helpers to the Lugg platform was a slow and manual process because Lugg had to sign drivers and helpers up for multiple services before being able to pay them. Because the process was so manual, new drivers and helpers had to visit local Lugg offices to walk through the process with someone from the team, which involved filling out paperwork and getting set up on multiple separate apps: payments, fleet tracking, and route management.

Solution

Lugg chose Stripe Connect to automate the driver and helper onboarding process and add flexible payment options for drivers and helpers. With Stripe, Lugg can instantly pay service providers as soon as they request funds, and automatically split payments from Lugg’s customers to its drivers, helpers and partners.

Stripe Connect, which is designed for on-demand marketplaces like Lugg, allows the company to split payments with as many recipients and in as many
ways as needed–such as paying hourly rates and commission fees separately, and holding back portions of payments for supplies and equipment loans. All Lugg has to do is use the Stripe API to indicate where and when to send money, and everything else happens automatically.

Stripe Connect also enables Lugg to pay drivers and helpers whenever they want, with Instant Payouts. Given a long list of other engineering and product priorities Lugg wouldn’t have been to offer instant payouts without Stripe.

Results

Lugg’s driver onboarding process is now completely self-service, and getting started only takes a few minutes. The entire onboarding experience is streamlined into the Lugg app. “People don’t even notice they’re getting set up with payments,” Lugg’s CTO, Pedro Belo, says.

Plus, now that Lugg has launched Stripe's Instant Payout functionality, payment speed is an important competitive differentiator for Lugg–70% of drivers use instant payouts to get paid. “Instant Payouts are now part of the conversation when we advertise for drivers,” Belo says. “It’s how we attract more drivers to work with us.”