The P2P carsharing saga continues: The WhipCar story

WhipCar is a very recent British start-up in the still little known peer-to-peer car owner/rental business.  World Streets recently interviewed the group's founders and managers, Tom Wright and Vinay Gupta, to get at their side of this unfolding rather surprising 21st century alternate car story.  (And the first thing they told us was that it's not quite carsharing. Let's have a look.)

World Streets: To get us started may we ask you to explain to our readers in a paragraph or two how WhipCar works and what differentiates it from such standard rental cars or all those successful carsharing schemes such as Zipcar, Greenwheels or the hundred others that are out there on the city streets in various parts of the world, making it possible for people share cars, save money, and, with or without their conscious motivation, do their bit for the environment and their city?

WhipCar is a neighbour-to-neighbour car rental service. We share similarities with traditional carsharing schemes in that we help people save money while making better use of cars. However our approach is entirely different. WhipCar provides a solution that for the first time allows car owners to manage the inactivity of their car and make money by renting it out to others. WhipCar’s platform provides booking management, payment processing, fully customized comprehensive insurance and breakdown cover. Drivers thereby gain access to close, convenient and affordable transportation “next door”.

W/S. Hmm. I see: a sharing of cars, but not quite "carsharing" as we have come to think about it.  Now, Where is WhipCar today? How many towns are you active in? How many cars are in your "fleet"? How many drivers/members are using your service?

WhipCar launched in London in April 2010. Today (as of October 5th, 2010) WhipCar has a presence in over 450 cities and towns across the UK. We’ve grown (from zero cars in March) to over 1000 cars in our virtual fleet, which includes over 40 makes of car – making WhipCar arguably the most diverse rental car fleet in the world.

W/S. Why would I put my car into your WhipCar fleet? I imagine economics would be at the top of my list of motivations. Well, if so, how much could I expect to make per month by sharing my car with some strangers, with, for example, one or two profiles of "typical usage".

WhipCar Owners join to make money from their car when it’s left unused. Owners use the service if and when it makes sense for them to do so. They can manage their schedule of availability, are in full control of the price they set, how often they rent it out and to whom they rent to. Many owners also appreciate they are helping people in their community by temporarily lending out their car, albeit for financial reward.

We are finding that owners behave differently (no surprise there). We have a rich spectrum of user types –everything from stay at home mums who rent frequently for hours or a day at a time to young professionals who prefer week-long rentals that coincide with their client visits.

One the flip side we have drivers who choose to rent the same car again and again because it is a convenient and locally accessible transport option while other drivers have rented a variety of cars to suit their purpose (e.g. an estate car for an IKEA trip or a Jaguar for a night out on the town).

It’s helpful to think about WhipCar in the context of a Venn diagram. On the one hand we’re poised to take share from existing car ownership, rental and sharing markets but interestingly we are starting to see evidence of expanding the overall market too . For example, with a viable transportation option across the street, people are deciding to take that weekend away. Previously they wouldn’t necessarily have thought seriously about trekking across town to Avis or Hertz, their area is not served by a car-sharing club and of course they don’t own a car.

W/S. What happens if the jerk who rented my perfectly good car scratches, dents or totals it? As I understand it you have insurance, but what about my lost time and trouble caused?

We worked closely with the Lloyd’s of London insurance market for about 10 months to develop a groundbreaking insurance product that protects both the owner and driver during a WhipCar rental. It’s worth mentioning that WhipCar owners also play an important role in serving as a filter for who rents their car. They are in full control and can accept or decline any request.

W/S. Who is your competition? Streetcar?  Zipcar? Hertz? Avis? The taxi industry?

We’ve positioned WhipCar as a social utility. We clearly need car owners to provide liquidity for our marketplace, however we do promote a more efficient use of owned cars. In densely populated areas we may compete with car rental and traditional car sharing schemes, yet these alternatives are few and far between in the majority of the country. Your WhipCar may be “the only car in the village” and our incremental cost to support this is zero. Our vision is to have a WhipCar on every street in the UK.

W/S. I guess you are saying something like "act local"? I have the feeling that the Whipper works mainly as a "neighborhood sharing scheme". Is that right? And if so, what are the limits, advantages? Would you say that it is a form of social networking?

Traditional car sharing schemes are capital-intensive and are hard pressed to turn a profit. Zipcar the leading commercial player has not turned a profit in its 11 years of operation and many if not most carsharing schemes around the world receive some type of government subsidies.

Our hyperlocal model is economically run in urban and rural areas alike. It is very much a form of social networking “with purpose”. WhipCar shares a key component of the new mobility movement, which is genuine proximity. Traditional car sharing schemes start to break down when a car is located more than a ¼ mile away from you. Again it is not economical for traditional players to offer this density in all but the most populated cities, and even there they are hard pressed to either offer a ubiquitous service or be profitable.

W/S. (Hmm.  Hyperlocal . Nice. I like that and will think about it. But now back to work.)
What about your international competition, present or future? Are there any other WhipCars, peer-to-peer rental companies out there in other countries who may one day show up and eat your lunch? And if so, how do they differ from you? What is your eventual edge?

Recently a company in California called Spride has helped to spearhead legislation in that state that prohibits car insurance companies from disallowing personal vehicle sharing for reward as long as recompense does not exceed the cost of ownership. They aim to launch their service some time in 2011. Spride requires owners to install black box technology in their cars to facilitate keyless entry – a key differentiator from WhipCar.

W/S. Are there cultural differences that make a difference in this sort of thing? For example, you are British. Is this an idea that well work perhaps in a place like the UK, but may not export well to other cultures, countries? What are your thoughts on that?

We believer the UK is THE perfect place to incubate a business such as ours. In the UK we are working with one national DVLA and insurance framework. It’s a country of 29M passenger cars and 36M registered license holders and let’s not forget it is an island.

W/S (and finally). Is sharing poverty, a second or third-rate deal for the have-nots? Or can it be a form of wealth? Is it "against human nature", or at least "against English nature" to share?

As adults in the western world we unfortunately associate a negative stigma to the word sharing. It’s strange since we are taught to share as children. Somehow we become more cynical about this as we age and perhaps there is a status anxiety around “having to share” instead of solely providing for oneself. This notwithstanding we share plenty of things without realizing it. Health clubs for example are all about shared use and the preferred route for most people to use exercise equipment. Why spend £6,000 on a home gym that will be outdated in 10 years when you can pay £50 / month as it suits you. This is now a prevailing user behavior. WhipCar’s challenge is get people thinking the same way about their second most valuable asset: the car.

W/S: Thank you. And be sure that both World Streets and our World Carshare group are going to keep a close eye on you and the concept of "hyperlocal" carsharing by whatever name too.  I am sure that we are going to learn a lot on the process. Good luck!

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About our guests:

Tom Wright is co-founder of WhipCar. Previously he founded gurgle.com, a social network for pregnant women now owned by MotherCare, and bookarmy.com, a book recommendation service now owned by Harper Collins. Tom has held a number of senior digital strategy and development roles during his career with companies such as BSkyB and Fleming Media.

Vinay Gupta is co-founder of WhipCar. Previously he has been a digital media strategist and consultant working with brands such as Fleming Media, MySpace, Emap, Vue and the Abu Dhabi Media Zone. Vinay holds an MBA from London Business School and has held senior travel management positions at AT&T and American Express.

* And for more on WhipCar click here.

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