11 Comments

Summary:

As a big fan of car sharing networks — I ditched my car last year and am a CityCarShare customer — I absolutely heart this idea: Spride Share, a car-sharing network where regular car owners can rent out their vehicles, is coming out of stealth today.

As a big fan of car-sharing networks — I ditched my car last year and am a City CarShare customer — I absolutely heart this idea: Spride Share, a car-sharing network where regular car owners can rent out their vehicles to drivers, is coming out of stealth today. The startup is being led by one of the earliest greentech investors out there: Sunil Paul, who founded early-stage investment firm Spring Ventures and was an early investor in Nanosolar (here’s a Q&A I ran with Paul when I launched Earth2Tech three years ago).

The company also has an advisory board that a who’s who of Internet and transportation innovators, including Reid Hoffman, founder and chairman, LinkedIn; Mark Pincus, CEO, Zynga; Dan Kammen, director, UC Berkeley Institute of Transportation Studies; and Rick Hutchinson, CEO, City CarShare. The company says it will be able save car owners money on the cost of owning a vehicle and will enable people who don’t own a vehicle to have another car-as-a-service option. The company will use the web and social networking to deliver this distributed model of car sharing.

Spride Share is looking to grab ahold of the recent surge in car-sharing networks. According to Frost & Sullivan, the number of drivers using car-sharing networks increased 117 percent between 2007 and 2009 in North America. Within five years, the firm expects to see 4.4 million people in North America and 5.5 million people in Europe signing up for services like the one from Zipcar, more than tripling membership from 2009.

However, the big hitch right now for Spride Share is that current insurance law isn’t too friendly when it comes to people renting out personal vehicles (a startup called RelayRides that’s working with a similar idea for distributed car sharing has taken out a $1 million insurance policy to supplement a car owner’s coverage in case a user damages their car). So the service isn’t available now and might not be available until the law changes. On that end, the startup, along with City CarShare, has been working with California State Assembly member Dave Jones (D-Sacramento) to create Assembly Bill 1871, which would change insurance law to permit remuneration for personal vehicle sharing. The company asks you to support the bill on its site and is holding a press conference on the subject today.

If the service becomes available, Spride Share says it is free for vehicle owners to join, and they can make an estimated $2,000-$7,200 per year week depending on how many hours per week their cars are rented out. Spride Share plans to use a similar style communications service as Zipcar and City CarShare, with a key fob to open up the door and log in the user (the key fob system takes four hours to install, says the company), and the service sounds familiar as well with penalties for dirty cars and late returns.

For more on vehicles and IT check out GigaOM Pro (subscription required):

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By Katie Fehrenbacher

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  1. “So the service isn’t available now and might not be available until the law changes.”
    Wow, how many of us could get an A List advisory team and such great ink in spite of a law that pretty much prevents the strategy? Dang, well done – I’d get laughed out of the room.

    Couple other points: I wonder how this affects the big leased car population. Many owners actually lease which means mileage is a big issue (and any minor damage) – they can’t have their car traipsing around town non-stop – unless it pencils out that the rental fees out-way the excess mileage charges.

    Then there’s the wear and tear. Sure actual damage is one thing – but unless you’re a road warrior, you really don’t know what it’s like to have a car used like a fleet car. We’re talking more oil changes, tires, brake jobs, alignments, etc. Again – if it pencils out – i guess not a big deal.

    So it seems here’s the 2 sides of the coin.
    -Your car hardly gets rented, you get little money and you’re worried, given the little income, is it worth a damage claim.
    -Your car get used a lot, you’re making good money, but you’re finding wear and tear is monetarily and time-wise more of a hassle than you thought.

    Interesting – i like the idea of resource sharing. Maybe partner with service networks for maintenance issues that minimize some of these concerns…

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  2. [...] Spride Share: Using the Web for Distributed Car Sharing [...]

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  3. @Chris you have a right to be skeptical, no way of knowing if this company can launch a commercial product. But interesting idea for sure

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  4. [...] Automotive Adds on $21.5M in Loans from Delaware See All Articles » Spride Share: Using the Web for Distributed [...]

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  5. [...] Fehrenbacher describes how Spride Share intends to leverage the Web to match car owners with [...]

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  6. I was hoping this would also be like a “rides tweet” where it would connect drivers and non-drivers going in the same direction at the same time. So many roads filled with single drivers headed the same way … that is a huge waste waiting for the right system to replace it.

    @Chris: all those costs are the costs of using the car, presumably paid by the driver/renter. The question is whether the transaction & information costs are lower than the otherwise-cost of capital (extra cars sitting around), parking, etc.

    I’d love to see less parked cars in SF, where people often use them ~weekly, and they take up tons of space.

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  7. There are many issues to be resolved for sure. But at its core is the idea that you should be able to make up the costs of owning your car by sharing it with others without loosing your primary insurance. Technology makes it possible, but lack of clarity in the law keeps it from happening.

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  8. Hi Katie,
    Just a quick note that I love your articles. Thanks for the interesting writing and good info all the time.

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  9. Dave Jones for Insurance Commissioner Campaign
    NAME OF CONTRIBUTOR – PAUL SUNIL
    CEO/SPRIDE – SPRING VENTURES VENTURE CAPITALIST
    CITY – SAN FRANCISCO CA / 94117
    AMOUNT TYPE – $6,500.00
    TRANS. DATE – 5/19/2010

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  10. [...] The basic idea is that private car owners will make their cars (which, after all, sit idle on average more than 90 percent of the time) available to friends, neighbors or the wider public (their choice). They’re reimbursed from $5 to $8 an hour for the time someone else is behind the wheel. Social networking, GPS and cell communications will hook people up with cars. [...]

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  11. What I don’t understand it that the car owner makes about $2000-$7000 a year out of renting it for 10 or so hours a week. That’s only about 80 cents an hour. At least make it $2 or $3 an hour!

    That’s a major rip off considering the wear and tear of the vehicle as well as mileage. Strangers in your car, smoking, or doing whatever they want inside it. If it’s an old jacked up car, then maybe I wouldn’t mind.

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