Textbook rental site BookRenter just announced that it has raised $10 million in a second round of funding.
Book rental sites promise to help students cut back on their textbook spending. Why spend hundreds of dollars on a book if you’re only going to need it for a few months? With services like San Mateo, Calif.-based BookRenter, students simply pay a rental fee and then return those books at the end of the class. The most prominent company in this market has been Chegg, which is backed by top venture firm Kleiner Perkins Caufield & Byers, but chief executive Mehdi Maghsoodnia said he has a different strategy.
The first part of his plan was to establish BookRenter as the clear number two among websites for where students can rent books directly. The company says it now rents books to “thousands of students on over 5,000 U.S. campuses.” While it may not overtake Chegg in popularity, Maghsoodnia says BookRenter keeps its costs down by not buying or warehousing any books itself — instead, it connects students with partner companies who fulfill the rental orders.
In recent months BookRenter has been building the second part of its strategy — working with campus bookstores. After all, those bookstores still control a majority of the textbook market. BookRenter works with stores to add textbook rental options to their own sites. Students can either pick up their rentals from the store or have them delivered directly. Either way, the store gets a cut of the revenue. The company says more than 75 campus bookstores have signed up to use the platform.
With the launch of Apple’s iPad, there’s growing interest in electronic textbooks, too. When I asked Maghsoodnia if that’s an area BookRenter is looking at, he said it is, but it’s “not the highest priority on my list.” For now, the iPad is still priced too high for the majority of students.