Startup Turns Anyone's Car Into Part Of A Zipcar-Like Fleet

May 30, 2011— -- Companies like Zipcar and Hertz's Connect have proven there is a market for alternatives to car ownership, but they fall short of meeting everyone's price point and needs. In many markets, Zipcar charges an $82-per-day rate in addition to an annual fee, and the service isn't offered outside of cities.

Getaround fixes both of these problems by allowing its users to rent their neighbors' cars. It's like an Airbnb for vehicles. Car owners choose their own hourly rental rates and schedules — all they need to do to make their cars Getaround ready is install a free "carkit," which functions as both GPS tracker and key mechanism.

Renters can sign up free of charge. After they're approved by the owner of the car they'd like to rent, they pick up it up using an iPhone app that unlocks it. Insurance (provided by Berkshire Hathaway) and 24-hour roadside assistance come with the rental fees, which most owners set at between $3 and $15 per hour.

Avery Lewis, Getaround head of product, says some renters have used the service as a way to safely lend their cars to roommates who don't have insurance. At the other end of the spectrum, one woman went on vacation with her car available for rent during her abscence and then was able to extend her vacation using the proceeds.

If Getaround catches on, its number of available rentals has the potential to make Zipcar's 8,500 cars look diminunitive. And it could reach areas that are too rural to be viable for a company like Zipcar — all while taking a 40% cut of rental fees on vehicles that it doesn't own.

As with most good ideas, community car sharing isn't something just one company is pursuing. A startup called RelayRides, which counts Google Ventures and August Capital among its investors, is pursing a similar idea. The company already has cars available in San Francisco and Boston.

Getaround has functioning services in San Francisco and San Diego, and it officially launched its national expansion at TechCrunch Disrupt on Tuesday. It also won the competition's $50,000 grand prize.

The startup will add that cash to $1.25 million in funding as it courts a critical mass of car owners beyond the Bay Area.