School bus tech drives classroom gains

• Long bus rides and inconsistent service often lead to kids showing up late — or missing school altogether.
• And remarkably, parents and school administrators often have better visibility into when their lunch will be delivered than when a child will get to school.

The big picture: The $50 billion school transportation market is fragmented and highly localized, and many independent contractors lack the resources to invest in modern technology.

• But that's changing. A handful of large bus operators backed by infrastructure funds and private equity have been buying up small regional players.

State of play: First Student, owned since 2021 by Sweden's EQT Infrastructure, is the largest by far, with 51,000 vehicles in 42 states and a growing suite of technologies, including AI-enabled cameras and telematics.

• The newcomer is Züm, a Silicon Valley startup intent on disrupting school transportation the way Uber upended the taxi business 15 years ago.

Zoom in: Fresh off a $100 million fundraising round, Züm CEO Ritu Narayan is positioning the company as "the AWS of student mobility."

• Züm's Connected Mobility Experience (CMX) platform replaces outdated analog systems with a unified operating system connecting families, schools and dispatchers so that no one has to wonder, "Where's the bus?"
• Züm provides more than software. It also hires the drivers, supplies the buses (electric ones in some districts) and manages the fleet.
• "When you are wanting to revolutionize the experience, you have to own every single layer," says Narayan, who co-founded the company with her brothers in 2014 to try to solve her own kids' transportation issues.

Züm has grown quickly in the last five years and now operates across 4,500 schools in 17 states, beating incumbents for long-term contracts in Oakland, Calif., San Francisco, Los Angeles, Kansas City, Seattle and Philadelphia, among others.

• Revenue hit $333 million in 2025, with $2 billion in contracts awarded, and the company broke even on an EBITDA-adjusted basis last year, according to a press release.

How it works: Züm's platform features dynamic routing to help drivers stay on top of changing traffic conditions, along with self-learning navigation and optimization so routes get smarter every day.

• Students tap in with an RFID card or other method, and parents are notified when their child is dropped safely at school.

The impact: Züm's intelligent routing, and mixed bus sizes, resulted in a 98% on-time performance, shorter commute times for kids and significant cost savings for schools.

• San Francisco's Unified School District, for example, cut annual transportation costs by up to 10%, the company said.

What we're watching: The system has already led to better education outcomes for children, according to school administrators.

• Kansas City Public Schools — which had faced transportation challenges for years — saw transportation-related absences decrease from 25% to about 5.6% in one year after awarding its bus contract to Züm, according to Superintendent Jennifer Collier.
• "We're now seeing gains academically that we had not been seeing before, either," she said, citing higher literacy rates because children were in class more often.

Zoom out: First Student's Halo platform, introduced last year, integrates many of the same technologies in its own buses, but the company acknowledges the quickening tech race since Züm entered the market.

• "I applaud them," First Student's chief information officer, Sean McCormack, tells Axios. "Every once in a while, they'll get a little ahead of us, and then we'll catch up."