EquipmentShare (YC W15) Is Like Airbnb for Construction Equipment(techcrunch.com)
techcrunch.com
EquipmentShare (YC W15) Is Like Airbnb for Construction Equipment
http://techcrunch.com/2015/03/09/equipmentshare/
5 comments
Thanks for your comments and suggestions! Would love to hear from anyone you know in Missouri that's interested.
> Insurance
Insurance is a huge pain for equipment. Most of the contractors we've encountered have an insurance policy that covers rental. Those that do not must pay ~15% to be added to a 3rd party insurance policy. We do not allow uninsured rentals to occur through our site.
> Maintenance
We work with mechanics in the area to have equipment automatically serviced when it's needed
> Mobilization
If you need the equipment delivered, we have agreements with towing companies. There is a fee for this (depends on weight, distance, etc).
> Fees per what?
We charge per day, for the very reason you pointed out (complexity). We haven't had any pushback about this so far, but if we do we'll look at it.
> Find the right model for older equipment
We don't have an official policy on what can be listed and what cant, but "don't allow old junk" isn't far from the mark. We're also collecting reviews and rating information, which will help us filter out equipment that gives a bad experience.
> Insurance
Insurance is a huge pain for equipment. Most of the contractors we've encountered have an insurance policy that covers rental. Those that do not must pay ~15% to be added to a 3rd party insurance policy. We do not allow uninsured rentals to occur through our site.
> Maintenance
We work with mechanics in the area to have equipment automatically serviced when it's needed
> Mobilization
If you need the equipment delivered, we have agreements with towing companies. There is a fee for this (depends on weight, distance, etc).
> Fees per what?
We charge per day, for the very reason you pointed out (complexity). We haven't had any pushback about this so far, but if we do we'll look at it.
> Find the right model for older equipment
We don't have an official policy on what can be listed and what cant, but "don't allow old junk" isn't far from the mark. We're also collecting reviews and rating information, which will help us filter out equipment that gives a bad experience.
Co-Founder here. Happy to answer any questions.
PLEASE stop using the advertisement "like AirBnB for x". I swear all of the YC companies are using it now.
IDK the description seems to fit. What's wrong with terms of art?
We're aware of Getable. We see them as more of a middleman between contractors and rental companies, whereas we focus on helping contractors lend out idle equipment.
Just sent this to my father who owns a commercial landscaping company. His skid-steers sit unused 80% of the time. And other times he has to rent specific equipment just for a few days. Great idea.
Isn't this Hertz, Sunbelt or United?
I see how this is a startup, get people with capital equipment sitting around, monetize it, make a cut of the transaction.
But seriously, this is a feature of one the three I just mentioned.
Look at how Hertz and Enterprise have taken on the self service car competition and at the same time made it a non-starter to run your own fleet. Same exact thing. You have an extremely small window to execute. The only reason to own is for chain of custody and latency, if you can "solve" those problems, done. Most construction companies don't own anyways.
I see how this is a startup, get people with capital equipment sitting around, monetize it, make a cut of the transaction.
But seriously, this is a feature of one the three I just mentioned.
Look at how Hertz and Enterprise have taken on the self service car competition and at the same time made it a non-starter to run your own fleet. Same exact thing. You have an extremely small window to execute. The only reason to own is for chain of custody and latency, if you can "solve" those problems, done. Most construction companies don't own anyways.
Off the top of my head, some challenges:
Insurance Equipment can be rendered unusable in so many ways. It's not even in the same ballpark as an Airbnb guest ruining the carpet. You've got to have insurance for this. Who pays? How much? Does anyone even want to offer insurance to this market? The "About" page mentions verification, which in theory might reduce EquipmentShare's risk, but I wonder. It won't be the same as insurance sold to existing rental companies. I doubt that a standard contractor's worksite insurance plan covers this either.
Maintenance Most of the equipment pictured on the website requires daily maintenance by a qualified operator or mechanic. Sure, the interval gets stretched, but that's usually by the owner or her agents, so they get what's coming to them. I understand that this is the primary headache for equipment rental places, but they are better able to deal with it than an individual contractor would be, and typically they know their customers pretty well before they e.g. rent a Bobcat for a month.
Mobilization If it fits in the back of a pickup, this probably won't be a problem. Lots of stuff doesn't. Who is hauling the equipment? When? Is it a separate fee? Does the hauler have insurance that will cover the value of the equipment? (Is that the sort of thing that we should leave to reviews?)
Fees per what? Lots of stuff is fine to rent by the day. If it has an engine, however, it's often better to rent by the operating hour. If the lessee just wants to use something for an hour a day, however, minimum fees might be appropriate. This could get complex.
Find the right model for older equipment With old enough heavy equipment, operating costs swamp equipment value. That is, if you have an old bulldozer sitting out in a field, it's costing you nothing. (The capital is fully depreciated.) If you then use it for a month, you're going to have to replace all the many filters a couple of times, run a couple of buckets of oil through it a day, fix all the dry-rotted hydraulic hoses, locate and repair some seals, replace both batteries, locate and fix clogged grease fittings, and then pray that nothing big like a pump or a turbo goes out. If this stuff is the lessor's responsibility, the rental fee will need to be higher than one might expect. If it's the lessee's, it won't get done, the machine will be ready for the scrapyard after a week, and one might expect lawsuits. The right model might be "don't allow old junk", but this is an area where this service can differentiate itself from existing equipment rental, so maybe not.
Actually now that I think about it, this service might be better for specialty tools like hammerdrills and scaffolding than it would be for motorized equipment like that pictured on the landing page. Fewer details, and less money on the line in case of disaster. One suggestion I would definitely make would be to sign up existing rental companies and equipment dealers (perhaps through a separate website if you don't want to confuse contractors). They have a lot of existing inventory and will view this as another sales channel.