We recently announced our investment in Drivy, a peer-to-peer car rental platform out of France complementing our existing investment in India based Zoomcar. Drivy became our seventh investment in the connected car theme and our second investment in France during the last three months.
Because the sharing economy has its origins in Europe, we believe France is one of the best places to build a company like Drivy. Though AirBnB was founded in the US, more than 50% of its business is based in Europe and 6 of the top 10 cities on the platform are in Europe, with Paris being number one. Even before the sharing-economy became a global trend, various European cities had a number of bike and car sharing schemes and Europe still accounts for around 40% of all vehicles in the global car-sharing industry.
Car ownership is declining
As more youngsters prefer to live in cities and transport systems are getting overloaded, rather than building more roads and car parks, our city planners and governments need better ways to utilize existing infrastructure and existing investments. Many young people prefer to not own a car as the costs are going up and a car is becoming a burden rather than a convenient solution to your transport needs. This has led to an increase in alternative means of transport including ride sharing, car sharing, electrical bikes, electrical skateboards and the like. A recent BCG study expects that the car-share market will expand quickly and widely over the next decade.
Disrupting the car rental experience
Car rental has stayed pretty much the same for as long as I can remember. Even though a car can be booked online, one still needs to queue up at the rental shop, go through manual paper work in order to qualify as a renter of the car, and to top it off you don’t have a guarantee that you’ll get the car you’ve asked for. And what’s with all the hidden costs that appear on the receipt slip once done renting the car? Not surprisingly, the average NPS for car-rental companies is less than 30. Needless to say, it’s time for a change in the user experience.
Drivy is a connected marketplace that can focus 100% on creating the best consumer experience. Drivy does not own its cars and thus does not have to obsess over yield management, but can rather make the experience and the platform as efficient as possible. This is is key to leading in service innovation and create minimal friction. We believe that the Drivy experience can potentially disrupt the traditional car rental market. Renters can chose a car among different options and reach out to car owners directly. Based on mutual agreement, renters book a car that is fully insured at a pre-determined all-inclusive price. The check-in process is smooth and the renter and owner complete the agreement on the mobile app. Drivy has launched ‘Drivy Open’ which offers a keyless entry into the cars minimizing friction even further. When we tried out Drivy Open on the streets of Paris, we were struck by the “magic” of opening somebody else’s car with our smartphone. The entire transaction happens using the smartphone. The Drivy team is busy launching more services such as automated driver scoring, hourly bookings, delivery service and others that will make the peer-to-peer car rental experience even better.
We are really thrilled to join the Drivy ride and be part of their future growth journey.