Editor’s note: This is part of VentureBeat’s series “Startup Spotlight.” Every week, we’ll sift through the scores of companies applying to be promoted and profile the best one. Companies can sign up here at the Entrepreneur Corner, which is currently sponsored by Microsoft. (Of course, you’ll still find lots of startup news and innovation in our day-to-day coverage.) Today, we continue the series with BookRenter.com, below.
As I detailed yesterday in a story about open-source textbook company Flat World Knowledge, students are tired of paying exorbitant fees for college textbooks. With many shelling out up to $300 for even one book, and an average of $900 every academic year, more are turning to online solutions than ever before, with Kleiner Perkins-backed book rental site Chegg leading the way and bootstrapped competitor, BookRenter.com, picking up speed.
With less that $1 million under its belt and one-tenth the number of employees, BookRenter has seen its traffic spike 40 percent in the last year and has brought in an executive from flourishing retail site CafePress, Mehdi Maghsoodnia, to head up its further growth efforts. And he’ll be the first to say that BookRenter fully intends to lap Chegg within the next several academic years. (Although, Flat World’s impressive offering of open-source textbooks that are freely accessible online could prove a bigger threat than both Chegg and BookRenter expect.)
How BookRenter plans to execute on this boils down to marketing. The site is simple and streamlined, with fewer frills and distractions than Chegg, but with the same promises of long-term rental with free return shipping and a green bent. BookRenter touts its Carbon Neutral Shipping while Chegg promises to plant a tree for every book rented (whether or not either of these promises bear out remains to be seen, but it indicates a hive mind when it comes to marketing these products). Similarly, the former says it can reduce the amount students pay for textbooks by 75 percent while the latter expects to save students between 65 and 85 percent. Both services also have costs hovering around $70 — much cheaper than buying from campus bookstores or even Amazon and bargain online merchants.
It’s meaningful that BookRenter, a startup founded in 2006 by a student at Santa Clara University in the heart of the Silicon Valley, has grown to rival Chegg despite its lack of resources. The company attributes this traction to its more thorough understanding of the student experience — when, why and how they need and acquire their books. Representative of this attitude, the company launched its “campus rep” program last year — paying a commission to student point people on campuses that promote the service to their friends and classmates. This word-of-mouth-inspired strategy allows students to refer the company directly to each other — thus cultivating community around the concept — and has proven highly effective.
For now, BookRenter’s Maghsoodnia says that there is plenty of space in the alternative textbook market for all players. So his company will continue chipping away at the market without directly competing with Chegg. It has 1 million book titles, and 50,000 customers spread over 3,000 campuses. This tack will probably be viable for a while since so few formidable companies are the space. Aside from Chegg and Flat World, there is CampusBookRentals.com, but that has even less of a presence.