WhipCar, a UK-based service which launched a few years back to allow consumers to borrow a neighbour’s vehicle, is no more after shutting its doors this week.
Launched in April 2010 with a vision to tap into what it believed was an abundance of cars often unused for large portions of the average week, it turns out that the “scale” issue has caught up with its founders and the service has now closed.
The potential numbers were huge: 30 million passenger cars in the UK alone which were only used for 4.6 hours a week, leading to what it believed was a multi-billion dollar market in the next few years.
The early signs were good, at least in terms of securing £1 million in investment from Delta Partners. Other players have come along in the meantime, such as GoCarShare (TLabs here) and Carpooling (TLabs here).
But, three years in, WhipCar has decided to call it a day, citing what it says are “still barriers to widespread adoption of peer-to-peer car rental in the UK”.
Having a “small team with limited resources” meant that the “scaling challenges” could not covered off, thus the decision to draw the curtains on the company.
“In many ways, WhipCar has been a success. We were able to shift commonly-held perceptions of car sharing and ownership with the help of so many integral WhipCar community members.
“We have been able to boast that drivers in urban areas such as central London could access convenient, cost-effective and friendly WhipCar rentals within five minutes of their doorstep.”
Nevertheless, it adds:
“We’re proud to have had a chance to push the boundaries of the sharing economy, and we can’t wait to see where it heads next.”
Related posts:
About Kevin May
I’m sure this concept will work one day – this shows that the sharing economy is only just beginning and there is a lot of work to do before that type of behaviour is widely adopted.
It’s just the start but already there are forces aiming to subvert p2p of course. See e.g. a recent discussion of Lending Club in The Economist.
A pity about this – I doubt that it’s the last we’ll see of p2p car sharing though. It’s a great idea whose time will come, hopefully not in an over-monetised e.g. zipcar guise.
Whipcar hoped to “walk before we can run” by penetrating the UK market, and hired an agency to tell them that they would expand so quickly that they could secure a big loan. They hired an office with an address in central London and ten staff. When take-up was slow, they risked poster advertising in London Underground.
I hope that a more down to earth business takes-up where they left-off. Take-up for al peer to peer services is slow. Advertising and office costs have to be cheap. I suggest that the next players do not give-up the day job, work from home, and send .pdf posters to their members to print-out and stick inside their cars. And bumper stickers. And leaflets to put through local letterboxes. That way, eventually, people will get used to using a certain web site or a certain list of neighbours to provide car hire.
I’ve written a few lines on how to get a day’s car insurance for under £20 on http://employees.org.uk/hustings.html – if you want to start your own successor to Whipcar, start there!
The concept sounded good – but the pricing was not right to hire a car, everytime I checked I found Avis was cheaper!
It’s cultural.
There are three fundamental things which very across cultures and one of them is attitude to what is considered ‘public’ and what is considered ‘private’. In Britain the car is definitely private. I will no more lend you my car than I would lend you my underpants. (both private). But to an American the ‘hey, take my car’ attitude is completely different. £1m investment does not change this attituded overnight. Good try, it’s an idea whose time will one day come.
Simon
Just out of curiosity – what are the other two?
cheers
John
This is a huge shame. I really thought WhipCar had nailed the business model.
JR/John,
The difference with WhipCar and most other P2P businesses is that car insurance is compulsory and coming up with a unique insurance product was one of their greatest feats. Having VC backing
provides much needed credibility.If you don’t have this and go for the slow community approach (best way long-term) then how on earth to do you head over to Lloyd’s and ask them to create and back an insurance policy which never previously existed? You have to some financial muscle if you want to do p2p car rental in my humble opinion. You also have to screen drivers as there are too many idiots out there trying to pull a fast one.
Seems to me the way to offer this service is probably to align closely with the airbnb model.
Vet all drivers, implement a review system, offer your service for free, but don’t offer insurance as standard, let the driver and renter sort that out themselves (don’t release the vehicle until you’ve seen an insurance document).
Make money by taking a cut from the various short term car insurance companies available.
So the site would be a listings site for car hire, and a listings site for daily insurance deals, making money of insurance commission and the odd advert.
There would be a mutual review system for members.
There would be a guide to skim-reading and quick printing of insurance policies, often bought from the same site.
This sounds like a good start. I wonder if Whipcar’s ex-insurer offers a policy with no paperwork, for people who don’t have a printer handy?
I feel the best way to get a system like this running well is to be able to invest in car club technology so that one can book and use an unused car without the need for the owner to be directly involved – basically I mean installing card readers and key devices (to hold the car keys in the glove compartment). In other words to run a P2P car club exactly the same as any other car club.
I think that would take off.