For many urban dwellers, the idea of owning a car just doesn’t make sense. Public transportation as well as highly marketed car renting services like Zipcar and City CarShare make it easy enough to get around. But if you do own a car, wouldn’t it be nice to make some extra money with your car that usually sits on the street or in a garage for most of the day? Well, one company is betting on just that.
Boston startup RelayRides announced it has raised an undisclosed round of seed funding to launch a pilot program in Baltimore for the first person-to-person carsharing service. The funding will help the company to provide a platform for car owners to list their vehicle for rent during unused periods and renters to sign-up and have access to dozens of listed vehicles.
Unlike traditional car rental services, RelayRides neither owns the vehicles nor maintains them. Rather, they are offering a platform for car owners and renters to connect generating scalability and lower pricing. The company will make money through a flat transaction fee per rental (15% of total owner income per rental).
Here’s how it works for car owners: Visit RelayRides and sign up. A company representative will contact you and help you to enroll your car. Next, a certified mechanic will come to your car and install a device that will give renters access to your car using a special RelayPass membership card. With this device, there’s no need to worry about exchanging keys or having to be with your car when the renter arrives. RelayRides then sets you up with their own insurance policy to cover your car and the renter. You keep your current policy for when you drive. The two have no effect on each other. Now you’re ready to list your vehicle. The car owner has complete control over rental price, how many hours a week it’s available and where the pick up will happen.
Worried about who’s renting your car? RelayRides noted that all potential renters will have background checks prior to joining the carsharing community. If they pass, only then will they have access to the cars listed. Renters will be given a RelayPass membership card that will provide entry to the car through the specially installed device mentioned before. Another plus for renters, gas and insurance are included in the rental price.
RelayRides says that a car owner can earn anywhere between $1,300 for a compact available for 10 hours a week annually to $12,000 for a luxury available for 30 hours a week.
A range of angel investors, entrepreneurs, and financial institutions, from Boston, Silicon Valley, and Baltimore contributed to the seed financing. These investors include Guli Arshad, an experienced entrepreneur and venture capitalist, who will join the RelayRides Board of Directors, along with Frank Bonsal and Jay Wilson, Baltimore venture capital professionals.
While Baltimore is the first city to have RelayRides, they are scheduled to spread to additional cities in the near future. Interested readers can sign up here to receive notifications on future city launches.