From 0 to $76 Million in Annual Revenue: How French Startup Ornikar Made Online Driving School a Reality

The one through-line in Benjamin Gaignault's life — from his studies to the makings of his online driving school startup Ornikar — is his strong-headed spirit.

The fourth and last child of two farm operators, Gaignault grew up in Diors, a small 700-person town of the Centre-Val de Loire region of France, in "a pretty traditional, aristocratic French family," he told The Org. Gaignault, who lost his father when he was 14, would later leave his family to attend a boarding school near Paris where the academic level was considered more challenging.

The now-entrepreneur, who is “pretty lazy” by his own admission, was captivated by the idea of starting a company since he was in school. Years later, after meeting with future co-founder Alexandre Chartier, Gaignault founded his startup, Ornikar, in 2014. At the time, it was the first and only online driving school in France.

After two years with no revenue, no clients and many lawsuits involving unions from traditional French driving schools, Ornikar finally launched in 2016 and quickly took over the market. Last year, the startup, which was at the time preparing more than 35% of drivers for the French traffic regulation test, raised one of the biggest funding rounds in France of 2021, with $120 million in Series C funding. The objective? To establish itself as the leading car insurance player in France and Europe.

From being on the road to launching an online driving school

After two years of studying international business at university, Gaignault decided to go to business school in Marseille. Due to a limited amount of class hours to attend, the future CEO found himself with five days to fill every week. He decided to work in parallel with his studies.

Between 2009 and 2011, Gaignault worked as a salesperson at SFR, a leading telecom company in France, driving around with his company car to visit branches to help managers hit their objectives. "I was 22 years old, I was talking to forty-fifty-ish years old branch managers, and I had a car and a huge marketing budget to push people to buy iPhones. It was a dream," the CEO recalled.

After finishing business school, Gaignault decided to go on a 6-month trip to visit Asia with his girlfriend and now wife. Upon his return, however, he was "faced with the harsh reality of the labor market of 2012" and, after many applications, ended up working as a sales representative for a company selling dark fiber subscriptions to B2B clients.

But it wasn’t a good fit for the entrepreneur, who has always found the challenge of creating a new business thrilling. In 2013, Gaignault, who couldn't bear his job anymore, met for dinner with Alexandre Chartier, who was introduced by a mutual friend. At that time, Chartier already had two businesses and an idea for a third company, but he had limited time to manage a new venture himself. Chartier, who wanted to launch a software solution destined to driving schools that could help them mutualize their resources digitally and improve their margins, found in Gaignault the perfect co-founder and co-CEO.

The two-year-long wait for legal driving school authorization

The two founders decided to participate in 101 Projects, an entrepreneurship competition judged by three well-known French entrepreneurs. Although all the driving schools Gaignault and Chartier had met with had so far refused to work with them, pushing back on the idea that innovation and digital could help them thrive, Ornikar finished first in the competition and received 25,000€ ($28,000) in the form of a convertible loan. It was the ultimate push to convince Gaignault to work full-time on the venture and build Ornikar as a modern, online driving school.

"The driving license test is the most taken in the world. At that time, it was costing on average 2,000€ ($2,300) to get a driving license so, with one million candidates every year in France, we had in front of us a 2 billion euros market. Plus, a recent study had revealed that 82% of the candidates were unsatisfied with their driving school, which created a huge business opportunity. Last but not least, Uber had just launched in France and was paving the way to new business models," he said.

In December 2013, the duo officially incorporated the company without knowing the amount of trouble they were in for.

Driving schools are regulated businesses in France. "To run a driving school you have to get an authorization and it was very easy to get it since you only needed five things at that time: a DVD player, a study room of 25 square meters, a TV, a vehicle with dual control pedals and a contract with a driving instructor," Gaignault said. Ornikar submitted its application in January 2014 to the council of Pari. At that time, the council was in charge of reviewing applications with a commission partially composed of representatives of unions of traditional driving schools. The driving school unions weren’t fans of Ornikar.

The two never heard back from the administration. Earlier that month, Ornikar had grabbed the headlines of L'Opinion, a new French media company, which titled their front page “With Ornikar, we want to end driving schools' racketeering methods,” — which was how the startup had defined itself during its pitch.

A few months later, in April 2014, the founders, who were still waiting for their authorization, ended up receiving a subpoena: Sued by six of the driving school unions, Gaignault and Chartier could each risk twelve months of imprisonment, a fine of 50,000€ ($57,000) and the interdiction of incorporating a business on the French soil for a few years. "At that time, we had just a showcase website, no client and an empty classroom, so the whole situation was ridiculous. We also had no money but, per my former cofounder's philosophy, ‘there is always good news hiding behind bad news.’ In that case, the press put us in the spotlight, and since everyone had bad memories from their driving school experience, we were basically pictured as David fighting Goliath," Gaignault said with a laugh.

In July 2014, the team received the judgment: Not only did they win the lawsuit — partially — but the French media broadcasted the news nationwide. The lawsuit had inadvertently brought them more attention than they’d had before. "It was a marvelous moment for us because we were still waiting for our authorization, we still didn't have any clients, but we felt like we had just sold our company for 3 billion euros! My phone was receiving voicemails after voicemails. We were invited to all major radio and TV news shows, which was absurd because we had nothing more than a concept," the CEO recalled. "We finished this media coverage marathon with the front page of the International New York Times. Somehow, the whole case was taking insane proportions."

The two founders were then invited to the Elysée. Excited to be received by the government, Gaignault and Chartier took a selfie in the courtyard on the way to their meeting without knowing that this appointment would take an unexpected turn. Accused of French bashing by the government after telling The New York Times that the French administration hadn't gotten back to them six months after submitting a complete application, the duo published their selfie on social networks anyway. The picture, right away picked up by French media Le Figaro, got featured in an article titled “The meeting organized by the Elysée that angers driving schools,” adding more fuel to the fire.

“If at first, you don't succeed, try, try and try again”

In November 2014, the two co-founders managed to raise $1.1 million (1 million euros) in seed funding. They still had no activity, no clients and no revenue. Based on their study of the subtleties of French laws regarding driving school, the duo realized they could still legally teach traffic regulations without the driving school authorization, the same way anyone can go to a bookstore and buy a highway code manual. They decided to sell traffic regulation lessons and met with the three leading companies of that segment to get licenses. However, these companies refused to sell to them after revealing they had received a warning from unions that driving schools would stop buying licenses from them if one ended up working with Ornikar.

Resilient, the two founders decided to hire driving teachers to go on the road with a GoPro and take pictures of traffic regulations to create batches of questions and build their own content. In March 2015, Ornikar launched its first series of questions and, finally, obtained its first stream of cash. But soon enough the founders were faced with a new challenge: their first students, who had passed their written examinations and needed now driving lessons, all ended up being pushed back by driving schools for being former Ornikar clients.

After a few more attempts to bypass the absence of authorization to be a driving school, the company was sued again and, this time, lost in December 2015. Due to divergent views, the duo of founders split and Chartier chose to leave the venture. "It's pretty simple: In January 2016, everyone, from the media to the general public, believed Ornikar had shut down. One founder had left and the company was running out of money, but that didn't kill us," Gaignault said.

Gaignault picked Flavien Le Rendu, Ornikar's first employee, as his new business partner and co-CEO and, together, the two CEOs decided to relaunch the company by submitting a new application in another region and under a different name ("Marianne Formation", Marianne being the national personification of the French Republic since the French Revolution). This maneuver, however, was spotted right away. After a few more hiccups and the rumored intervention of Emmanuel Macron, who was then France’s Minister of Economy, Ornikar finally obtained its agreement on March 31, 2016 — two years after its initial application. Ornikar was now finally, officially and legally an online driving school.

Building Ornikar as a unicorn

Things went fast afterward. A year later, in 2017, the company reached $4 million (3.5 million euros) in revenue and counted 55,000 students. "We were in the starting blocks. We had been waiting to get this authorization for two years. We exploded our growth objectives right away — our numbers were skyrocketing. In January 2018, we raised 10 million euros ($11.36 million). Everything was easy now. We were growing without doing anything, so Flavien and I started to get bored. That's when we decided to make Ornikar a unicorn. But the driving school business was not big enough to get there so we had to figure out ways to massively generate more cash,” Gaugnault said.

With 200,000 students, 250 cities where to get on-demand driving lessons with Ornikar’s teachers, a 90% success rate at the traffic regulation tests and 72% at the driving test, Ornikar had become a success story almost overnight. Gaignault and Le Rendu, therefore, decided to launch in new geographical markets and segments. But things didn’t work as planned. After launching in Germany, the company left the country six months later, as the German market was too complex. In parallel, Ornikar launched a car offering in partnership with car dealers, but quickly shut the activity down too because dealers weren't interested in young clients looking to buy cheap cars.

The pandemic and the confinements in 2020 didn’t led to more turbulence. Instead, Ornikar saw young people who were stuck at home taking advantage of the situation by learning traffic regulations. “Our business didn't stop, only our driving lesson activity, which wasn’t the case for all the other traditional driving schools that were relying on their classrooms to prepare students for written examinations. And, at the end of confinement, this new cohort of students was ready to learn driving so our driving lessons’ figures exploded," he said.

In September 2020, fueled by two-digit monthly growth, the team launched its driving school in Spain as well as its car insurance product with the ambition of becoming the biggest actor in auto insurance in Europe. "We launched our insurance with a very stupid and restrictive vision: that we were extending our Ornikar customers' lifetime value. Time proved us wrong. Two months later, we had 400 clients for our insurance but 80% of them were not former Ornikar students. Those clients told us they had picked Ornikar because they knew someone, a friend, a relative, that got their driving license through us. Because we were perceived as experts in driving education they trusted our brand and our car insurance offering,” the CEO explained.

Ornikar’s growth and unicorn potential seduced new investors two years after its $40 million (35 million euros) Series B funding round: In April 2021, Ornikar announced it had raised $120 million in Series C funding with KKR to scale internationally its car insurance product and driving license business. “It took us only five weeks between the first meeting and the wire,” Gaignault said.

The startup, which now has 280 employees, seems to be sustainably back from the trenches. What's next for Ornikar now? Gaignault said mobile was a priority. "Ornikar is the tenth most looked up keyword on the App Store but we don't have a mobile app… We’re working on it," he said. If Ornikar managed to become the leading online driving school without a mobile app, who knows what the startup is capable of?