Getaround Wins TechCrunch Disrupt(techcrunch.com)
techcrunch.com
Getaround Wins TechCrunch Disrupt
http://techcrunch.com/2011/05/25/and-the-winner-of-techcrunch-disrupt-nyc-is-getaround/
5 comments
Keeping the key in the car doesn't void insurance. Every ZipCar already has a key in the ignition, and yet they don't get rampantly stolen (even in SoMa).
Fuel is under the responsibility of the renter - we've actually found that most renters bring the fuel back higher than where they took it out at. If renters repeatedly forget to refuel the vehicle, not only do they get bad ratings, but we actively remove them from the system.
Most of our owners make at least $300/month renting out their car a few hours a week, after commission. Popular cars like www.getaround.com/mini make well more.
As for how many people want to - we've had more than 2,000 cars sign up so far.
From the renter's side - we offer more choice and variety, as well as car's that are on average quite a bit cheaper. We can also penetrate markets that ZipCar cannot, and offer cars that are closer in proximity.
Fuel is under the responsibility of the renter - we've actually found that most renters bring the fuel back higher than where they took it out at. If renters repeatedly forget to refuel the vehicle, not only do they get bad ratings, but we actively remove them from the system.
Most of our owners make at least $300/month renting out their car a few hours a week, after commission. Popular cars like www.getaround.com/mini make well more.
As for how many people want to - we've had more than 2,000 cars sign up so far.
From the renter's side - we offer more choice and variety, as well as car's that are on average quite a bit cheaper. We can also penetrate markets that ZipCar cannot, and offer cars that are closer in proximity.
Owners will charge what they are comfortable to cover all these prospective costs. It is a market.
The main benefit from a borrower's point of view is that Getaround is both cheaper and more convenient than conventional rental. In fact, an owner could still charge more per hour, given that many rental needs are fractions of days.
It may turn out that owner's acceptable fee is high enough that it does not compare well with conventional rental, but from a pure market perspective, this seems unlikely -- rental companies all these costs you point out, plus the cost of idle inventory. An owner has already accepted the bargain of their idle inventory, and only sees upside in rental against the existing costs. Note that Zipcar also bears this idle-inventory cost on their fleet. Getaround has an advantage in harnessing idling capacity at no cost to themselves.
It may also turn out that the cost of acquiring users (both owners and borrowers) exceeds revenue per user, and so is not a feasible business. I think this is a real risk, considering the markup of 40%. I rented from Getaround in their earlier phase; it was an excellent deal, far better than ZipCar. The cars were closer (read, more distributed than zipcars) and cheaper. I think the 40% margin might move them into the range of more directly competing with common rental rates though. We'll see.
It's hardly crazy, though.
The main benefit from a borrower's point of view is that Getaround is both cheaper and more convenient than conventional rental. In fact, an owner could still charge more per hour, given that many rental needs are fractions of days.
It may turn out that owner's acceptable fee is high enough that it does not compare well with conventional rental, but from a pure market perspective, this seems unlikely -- rental companies all these costs you point out, plus the cost of idle inventory. An owner has already accepted the bargain of their idle inventory, and only sees upside in rental against the existing costs. Note that Zipcar also bears this idle-inventory cost on their fleet. Getaround has an advantage in harnessing idling capacity at no cost to themselves.
It may also turn out that the cost of acquiring users (both owners and borrowers) exceeds revenue per user, and so is not a feasible business. I think this is a real risk, considering the markup of 40%. I rented from Getaround in their earlier phase; it was an excellent deal, far better than ZipCar. The cars were closer (read, more distributed than zipcars) and cheaper. I think the 40% margin might move them into the range of more directly competing with common rental rates though. We'll see.
It's hardly crazy, though.
Owners will charge what they are comfortable to cover all these prospective costs. It is a market.
Too many unknowns to calculate a risk premium - a burned out clutch might cost me $1000 to replace. What about the time the car is out of action because it is in the shop getting said work done? I could pull out my spreadsheet and begin to work some figures using pivot table, but this is about saving money not practicing for an MBA.
The main benefit from a borrower's point of view is that Getaround is both cheaper and more convenient than conventional rental.
Sure but the main competitor here in ZipCar (and its rivals) not rentals. If I want to rent by the hour I'm going to ZipCar, not Alamo.
An owner has already accepted the bargain of their idle inventory, and only sees upside in rental against the existing costs.
Not entirely true on existing costs - there are existing costs plus potential new costs directly associated with the rental element -- see above. The upside is the what's left of both of those costs.
The cars were closer (read, more distributed than zipcars) and cheaper.
I'm in SF, where their beta roll out is, and ZipCar is absolutely plastered across the city. I can't see how Getaround has greater distribution than a ~10 year incumbent. I'm not also not seeing as being cheaper, esp if you compare like-for-like models and factor in ZipCar includes fuel.
If I charge $7/hr, and Getaround take 40%, I make $4.20/hr. To make $100, I gotta have the car utilized for 24/hrs a month - just under 1hr a day. I think that's a tough threshold (given I need to use the car too). I'm not even sure whether $100 makes it interesting for an owner either.
Getaround is probably going to W2 me on that, so I'll have to pay tax on it, so I'll be lucky to end up with $70.
Too many unknowns to calculate a risk premium - a burned out clutch might cost me $1000 to replace. What about the time the car is out of action because it is in the shop getting said work done? I could pull out my spreadsheet and begin to work some figures using pivot table, but this is about saving money not practicing for an MBA.
The main benefit from a borrower's point of view is that Getaround is both cheaper and more convenient than conventional rental.
Sure but the main competitor here in ZipCar (and its rivals) not rentals. If I want to rent by the hour I'm going to ZipCar, not Alamo.
An owner has already accepted the bargain of their idle inventory, and only sees upside in rental against the existing costs.
Not entirely true on existing costs - there are existing costs plus potential new costs directly associated with the rental element -- see above. The upside is the what's left of both of those costs.
The cars were closer (read, more distributed than zipcars) and cheaper.
I'm in SF, where their beta roll out is, and ZipCar is absolutely plastered across the city. I can't see how Getaround has greater distribution than a ~10 year incumbent. I'm not also not seeing as being cheaper, esp if you compare like-for-like models and factor in ZipCar includes fuel.
If I charge $7/hr, and Getaround take 40%, I make $4.20/hr. To make $100, I gotta have the car utilized for 24/hrs a month - just under 1hr a day. I think that's a tough threshold (given I need to use the car too). I'm not even sure whether $100 makes it interesting for an owner either.
Getaround is probably going to W2 me on that, so I'll have to pay tax on it, so I'll be lucky to end up with $70.
"
Too many unknowns to calculate a risk premium - a burned out clutch might cost me $1000 to replace. What about the time the car is out of action? I could pull out my spreadsheet and begin to work some figures using pivot table, but this is about saving money not practicing for an MBA.
"
Hmm, I guess I'm saying, charge $100/hr if you like. It's up to the owner. And it's not about saving money for a car owner, it's about making money. It's only about saving to the borrower.
" Sure but the main competitor here in ZipCar (and its rivals) not rentals. If I want to rent by the hour I'm going to ZipCar, not Alamo. "
At this point, I disagree -- rental is way larger than zipcar. And I think the Getaround approach is more scalable, so that when conventional rental is dead, Getaround will have a large lead, and distribution, over Zipcar.
" I'm in SF, where their beta roll out is, and ZipCar is absolutely plastered across the city. I can't see how Getaround has greater distribution than a ~10 year incumbent. I'm not also not seeing as being cheaper, esp if you compare like-for-like models and factor in ZipCar includes fuel. "
That's where I rented, too. Not sure what to say here, we're both anecdotes, I guess.
" If I charge $7/hr "
Are you saying that because you're fixing on what Zipcar charges? Most of the world hasn't heard of Zipcar. They've heard of car rental.
Hmm, I guess I'm saying, charge $100/hr if you like. It's up to the owner. And it's not about saving money for a car owner, it's about making money. It's only about saving to the borrower.
" Sure but the main competitor here in ZipCar (and its rivals) not rentals. If I want to rent by the hour I'm going to ZipCar, not Alamo. "
At this point, I disagree -- rental is way larger than zipcar. And I think the Getaround approach is more scalable, so that when conventional rental is dead, Getaround will have a large lead, and distribution, over Zipcar.
" I'm in SF, where their beta roll out is, and ZipCar is absolutely plastered across the city. I can't see how Getaround has greater distribution than a ~10 year incumbent. I'm not also not seeing as being cheaper, esp if you compare like-for-like models and factor in ZipCar includes fuel. "
That's where I rented, too. Not sure what to say here, we're both anecdotes, I guess.
" If I charge $7/hr "
Are you saying that because you're fixing on what Zipcar charges? Most of the world hasn't heard of Zipcar. They've heard of car rental.
Sorry, one more -- I think rates before national deployment were artificially low due to extreme early-adopters -- probably ideologically sympathetic. $100/mo is absurdly low, I think, given a rate. Rental agencies charge, at minimum, $30/day; I'm not sure how much a given car on Getaround would be utilized, but I think 80 hours is on the low side.
"I don't pay an annual membership with ZipCar"
You don't? how come? I thought their only pricing structures were either (a) annual fee, or (b) monthly commitment (with variations in fees).
You don't? how come? I thought their only pricing structures were either (a) annual fee, or (b) monthly commitment (with variations in fees).
Coupon codes.
You see them around, although when I signed up I found a 'hack' that showed a list of the possible corporate coupon codes you could use and I iterated through to find the ones with the best terms (this was a few years ago)
You certainly don't want to sign up for ZipCar without a corporate discount code. Not all of them require you to be an employee.
I own a car but keep a zipcar card in my wallet. There is a massive feeling of security knowing in an emergency/etc I can whip out my smartphone, book a car nearby and be driving within a few minutes.
You see them around, although when I signed up I found a 'hack' that showed a list of the possible corporate coupon codes you could use and I iterated through to find the ones with the best terms (this was a few years ago)
You certainly don't want to sign up for ZipCar without a corporate discount code. Not all of them require you to be an employee.
I own a car but keep a zipcar card in my wallet. There is a massive feeling of security knowing in an emergency/etc I can whip out my smartphone, book a car nearby and be driving within a few minutes.
Anyone know how it would effect my own insurance knowing that random people will be driving my car on top of the extra mileage? Also what about extra maintenance involved with renting out my car, are there any incentives from Getaround concerning this ? Another concern would be that, yes in general people that rent cars may not be as responsible with their rental as their own car.
Getaround comes with insurance, so while being rented your own insurance is unaffected! As far as maintenance costs, you set your car's own price per hour, so you can decide how much your extra maintenance costs will be.
Insurance is a red herring IMHO.
* Have you ever dealt with a major insurance claim? Even if you were renting out your car for $100/hour, that won't compensate for the headache you will be in for when your renter rear ends a brand new Mercedes-Benz and sends the passengers to the hospital.
* Think beyond insurance. What are you going to do when you receive a parking ticket or red light camera violation in the mail that a renter was responsible for? In the case of the parking ticket, you're on the hook no matter what.
* Even worse, if your renter is involved in an accident that's reported to Carfax, the resale/trade-in value of your car could plummet.
* There are no incentives great enough to compensate for all of the possible extra maintenance and repairs you may have to deal with. Depending on the make and model of your car, even a small ding or scratch could cost hundreds if not thousands of dollars to repair.
* Have you ever dealt with a major insurance claim? Even if you were renting out your car for $100/hour, that won't compensate for the headache you will be in for when your renter rear ends a brand new Mercedes-Benz and sends the passengers to the hospital.
* Think beyond insurance. What are you going to do when you receive a parking ticket or red light camera violation in the mail that a renter was responsible for? In the case of the parking ticket, you're on the hook no matter what.
* Even worse, if your renter is involved in an accident that's reported to Carfax, the resale/trade-in value of your car could plummet.
* There are no incentives great enough to compensate for all of the possible extra maintenance and repairs you may have to deal with. Depending on the make and model of your car, even a small ding or scratch could cost hundreds if not thousands of dollars to repair.
Those are all valid issues.
Consider, however, that every time you rent your room on AirBnB you open up yourself to as many problems (what if they steal from you; what if they damage your room; what if they cause a fire) and yet that hasn't stopped AirBnB from being a smashing success.
There's little point in opinionating on their chances of success. So far the signup rates seem to be fantastic and whether they're successful or not will become evident with time. We just have to wait a little.
Consider, however, that every time you rent your room on AirBnB you open up yourself to as many problems (what if they steal from you; what if they damage your room; what if they cause a fire) and yet that hasn't stopped AirBnB from being a smashing success.
There's little point in opinionating on their chances of success. So far the signup rates seem to be fantastic and whether they're successful or not will become evident with time. We just have to wait a little.
Your second point is addressed in the getaround FAQ.
In short, "Getaround will pay the ticket and take up the dispute with the renter."
http://support.getaround.com/kb/policies/what-happens-if-a-r...
http://support.getaround.com/kb/policies/what-happens-if-a-r...
How would they prevent a group of car thieves from using prepaid Master or Visa cards with fake names? Couldn't a thief just book a rental car for an hour, find the location, unlock the car with the iphone app, then take off with the car because the key will be inside? Let me know if I am missing something?
Right now it looks like they're requiring Facebook accounts to rent cars, and so they can (presumably) use the Facebook social graph as a rough proxy for trustability. Personally I sorta hate that policy (I've not got a Facebook account...) but it's a fairly good idea, I think.
And, of course many, many said similar things about AirBnB -- "couldn't a thief just book a room for the night and then make off with the TV?" -- and that's proven not to be much of an issue in practice.
And, of course many, many said similar things about AirBnB -- "couldn't a thief just book a room for the night and then make off with the TV?" -- and that's proven not to be much of an issue in practice.
Doesn't AirBnB require the host to be present during check-in and key exchanges? I assume a person would be more tempted to steal something if the owner never sees them in person.
Thanks for contributing here, Jacob. As you know, I'm a fan, and it's great to see some debate here. I'm not paying much attention to HN these days due to time constraints.
You don't even need to steal the car. You could simply take the the most valuable parts. Some parts can be taken without the owner knowing. Example: air bags. If you rented your car out, you would never know that your air bag was missing until you actually needed it.
Wouldn't that hold true for regular rental cars too? I have never heard of this being a problem with rentals.
Maybe TheSkeptic (brand new account) is a competitor?
Maybe TheSkeptic (brand new account) is a competitor?
Maybe TheSkeptic (brand new account) is a competitor?
Ugh, that's a shitty attitude. I think one of the good things about HN is that people here usually give each other the benefit of the doubt and assume good intentions. Lobbing accusations of bias around are a good way to kill that friendly tone. Unless you've got actual proof of bias perhaps you could keep your accusations to yourself next time?
Ugh, that's a shitty attitude. I think one of the good things about HN is that people here usually give each other the benefit of the doubt and assume good intentions. Lobbing accusations of bias around are a good way to kill that friendly tone. Unless you've got actual proof of bias perhaps you could keep your accusations to yourself next time?
I think it is a fair question. Brand new account, only posting in this one thread, with pretty flimsy criticisms, and a screen name specifically indicating a negative bias. I did look into it before posting.
I think it is also pretty shitty to use throwaway accounts without disclosure and a reason.
I think it is also pretty shitty to use throwaway accounts without disclosure and a reason.
A big Auth-hold transaction can mitigate this problem. An Auth-hold of $501 will prevent prepaid cards from being used. It also forces debit card users to have $501 available in their checking account. This should be enough to stop amateur thieves.
Professional thieves are a different matter. Traditional rental agencies have cameras at the rental counter, and get a copy of a driver's license. Building LoJack into the carkit won't work because it is too easy to block a GPS signal with tin foil. The only realistic way to stop professional thieves is to get driver's license numbers and review driving records for all members (which is what ZipCar does).
Professional thieves are a different matter. Traditional rental agencies have cameras at the rental counter, and get a copy of a driver's license. Building LoJack into the carkit won't work because it is too easy to block a GPS signal with tin foil. The only realistic way to stop professional thieves is to get driver's license numbers and review driving records for all members (which is what ZipCar does).
What about the issue of car thieves in general? From the sound of it, you are required to keep your keys inside the vehicle. The founders basically said "the keys will be in the ignition". Is there no locking component of any sort included in the getaround kit?
Doesn't this essentially make the application a directory of easy-to-steal cars for potential thieves?
Doesn't this essentially make the application a directory of easy-to-steal cars for potential thieves?
Keeping the key in the car (if you want to use their preferred auto-key-box-thingy) - I can't believe that wouldn't adversely effect or void my insurance. Certainly the part where I get a discount for an immobilizer is going to be negated (because the immobilizer is in the key, now in the car). And parking a car in SoMa with the ignition in it seems totally dumb - insured or otherwise.
It may come with insurance but that still doesn't cover someone driving the shit out of the breaks, clutch, drive train etc. How do you account for fuel - you can't say bring it back with a full tank because you may not keep a full tank in there. How do you account for the extra miles the car is run for with your own insurance?
How much are car owners really going to make a month after they have taken their cut? If you own a decent car, is $100/month really pushing the needle and making it worth your while?
I still wonder about the premis - how many people REALLY want to share their car with others. I won't let me best friend drive my car (or anyone else for that matter).
Finally, from the renters side, I'm not clear what benefit this has over ZipCars. I don't pay an annual membership with ZipCar, they're ~$6/hr, fuel is included (which it isn't here), they have distribution and choice of car, they're a known quantity, etc etc. Sure renting a Tesla or Porche is nice but again, I wonder why someone who can afford such a vehicle wants to rent it out to others and expose themselves to all the risk.