People love their cars. Do they love them enough to let complete strangers drive them for days at a time? That's what FlightCar is banking on.
Taking a page from the community-sharing playbook of Airbnb, FlightCar is putting a new twist on the car rental business. Instead of parking your car in long-term parking at the airport, FlightCar has pre-approved members drop the car with them instead. They rent it out to other pre-approved drivers at deeply discounted rates - all insured by FlightCar - and then return it to you washed, filled with gas, and with a modest check.
So instead of paying $50 to park for three days, you might actually receive a check for $50 instead.
"I had read an article two years ago about Airbnb. I talked with my now co-founder, and we sort of put two and two together," said FlightCar CEO Rujul Zaparde of he and co-founder Kevin Petrovic, who graduated Princeton in May of 2012. "We thought if people were willing to share their house, your second most valuable asset is your car."
Zaparde and Petrovic moved from Princeton to Cincinnati in the summer of 2012 to attend a four-month program at one of the top seed start-up companies in the country, The Brandery. But the duo had a chicken-and-egg problem before they could start anything.
Given the nature of the business and the guarantee to completely insure people's cars, their own insurance company asked for a great deal of capital up front. Money they didn't have. But after beating the ground for several months, Zaparde and Petrovic closed a first round of financing for $590,000 in January of 2013 and began FlightCar at San Francisco International Airport. They made their first rental on Feb. 5 of that year and then quickly scored a second round of financing - this time for $5.5 million.
FlightCar is now in Los Angeles and Boston in addition to San Francisco, with imminent plans to open another location in Seattle.
Zaparde and Petrovic did a lot of hands-on research, spending a week riding airport shuttle vans and talking to airline passengers who had just parked in long-term lots.
In an unscientific survey, they found 79 percent of people said 'No way.'
"We expected that," he said.
But they felt the 21 percent who said 'Yes' represented enough of a marketshare to start with.
There are some ground rules, of course. Vehicles cannot be older than 2001 model year nor have more than 150,000 miles on them, nor can the current Bluebook value be more than $50,000. Drivers are pre-screened; every car is insured for $1 million.
The average car being shared by FlightCar members, Zaparde said, is a 2008 Toyota Prius. FlightCar has also shared BMW 3 Series for $35 a day, compared to more than $100 a day by major car rental companies.
"I think people are getting used to it," Zaparde said. "We're becoming a sharable community."
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