$24M round B financing to US based peer-to-peer car sharing start up Getaround
By Carlo Iacovini
Since the last few years car sharing is changing personal and corporate mobility. Early start ups opened the market to rental models by hours and proved to became concrete businesses. Zipcar is a brand of AvisBudget group and keeps expanding operations in US and Europe. Local and national traditional car sharing operators grew in small scale models or become part of bigger networks. Especially in Europe we still see companies operating in city areas or nation based, not always being profitable with public funds. The most relevant innovation came by the free floating scheme. In Italy car2go and national oil company ENI owned ENJOY played a complete revolution in major cities like Milan, Rome and Florence, with more than 100.000 customers and for instance in Rome 15.000 rentals weekly. Free floating car sharing is easy to access and technology makes it appreciated by customers who also like glamour cars (Fiat 500 and Smart). While Autolib in France is the winning scheme proving that electric one way car sharing can impact on urban mobility with relevant Co2 emission reductions northern Europe markets still keep traditional schemes. In my recent published book (“Car Sharing il Business si muove” Edizione Ambiente) I describe different international experiences and business case but the market is rapidly changing again.
From US a new wave of innovation is facing the car sharing market, pioneering disruptive business models that combine high technology with unexpected individual behavior. Technology is the key driver of new application as new appls make simple sharing and operating services
Two different premises determined new businesses based on the concept of sharing personnel car:
- Sharing private car as a driver
- Sharing private car
UBER or Lyft represent best examples of the first approach, even if with different positioning. Uber is giant google funded key player to mobility services with a discussed overestimated financial evaluation that brings the company to be bigger than Facebook operating worldwide but with recent accuses of inappropriate strategies, against competitors, privacy policies violation for customers or even journalists. Law is also an issue as in almost every country transportation has specific rules and taxi regulations and private services need to operate in a new legal framework, still to be defined. Uber plan surely doesn’t focus only on the existing services and the goal of the company is to reshape overall mobility system in cities around the world. There might be the chance they will make it.
Looking at the future there are few new players facing the market with high potentialsuccess based on point 2. Relayrides and Getaround are 2 recent start ups
focusing on the opportunity for private people to share individual car to other members. For those who area familiar with sharing economy, it’s like AIRBNB for cars. While Relay rides targets daily (or longer) rental, Getaround seems to have found what in Italy we call “l’uovo di Colombo” (“Columbus egg” means something very clever). The GetaroundConnect is a device installed in the car allowing to open and to end the rental process with you phone. The keyless entry to vehicles makes easy to access even a private car because it solves the most inconvenient practical procedure (meeting to the owners and exchange the keys). This innovation increases numbers of vehicle available for customers, so the business itself. After few years testing in some cities Getaround just raised $24M round B funding from strategic partner Cox Automotive, to grow in US cities and improve operations. Considering number of vehicles parked on the streets for 80% of the day in bigger cities we bet that getaround is highly potential large scale business, not only in US but in Europe too specially where motorization index are insane (as in Italy).