RelayRides Puts Underemployed Cars to Work (Video)
RelayRides helps car owners lend their personal vehicles to local borrowers for an hourly fee. Will there will ever be a day when this idea doesn’t strike many people as insane? Unlikely.
But RelayRides CEO Shelby Clark thinks what he’s doing could be part of a larger societal shift towards access and away from ownership, starting with Netflix and extending to larger items like cars. RelayRides also connects people online to have an offline impact, a concept Clark had previously worked on as an early employee at Kiva.
In fact, RelayRides isn’t the only peer-to-peer car-sharing start-up, but it is well-positioned given $4.5 million in Series A funding from Google Ventures and August Capital, and having secured a $1 million insurance policy, and in light of recent California legislation changes that ensure insurance protection. The service is tiny, though; it has 1,500 members and less than 100 cars in Boston and San Francisco.
Clark explained in a recent interview that his company is like Zipcar without the overhead. RelayRides does put a lot of time and energy into installing an access device in every car in the system, and “hands down, the biggest challenge” was to secure the big insurance policy, Clark said.
Car owners choose their schedule, price (between $5 and $15 per hour) and parking place, and borrowers reserve online and then access the cars with key cards. Don’t call them “renters”–RelayRides employees have to put a quarter in a jar if they say the “r” word. The company prefers to think of its users as a neighborly community, and is working to make its site more social. RelayRides pockets 15 percent of each transaction and pays another 20 percent towards insurance.
But that’s not to say RelayRides car owners can’t make a nice bit of money by loaning out their cars rather than letting them sit idle. The company’s biggest moneymaker, a 2005 Honda Civic, brings in $600 per month, Clark said.
Have there been accidents and damages during RelayRides exchanges? Yes, but nothing serious–the biggest and only insurance claim to date was an axel broken by hitting a curb, and Clark’s team scurried into action to fix the car and find the amicable owner another one in the interim.
NetworkEffect visited RelayRides’ brand-new San Francisco office this week and took a video of Clark explaining the “sharing economy.”