High-tech ways to rent out your stuff
'Collaborative consumption' encourages low-cost, local exchanges
happy to let your best friend borrow your mountain bike, but would you be
willing to loan it out to a total stranger if you could make some money off the
the idea behind peer-to-peer renting, a new twist on the peer-to-peer (P2P)
commerce mastered by sites such as eBay and Craigslist. Instead of selling the
mixer or the kayak that sees only occasional action, you loan it to people in
your town, get paid a small rental fee and get it back when the borrower's
done with it. In the past few years, almost a dozen websites have popped up
promising to connect lenders and borrowers. For instance, you can use GetAround, JustShareIt and RelayRides to rent out your car or
to rent out electronics and gadgets, ToolSpinner to rent electric drills and
lawnmowers and Rentalic, Zaarly and Krrb to rent out a little bit of
part of the collaborative consumption movement, which encourages sharing,
including renting, as a way to save money, protect the environment and connect
with people. But despite the throwback sound, P2P renting is more high-tech
than hippie, with websites that eschew cash for credit cards, Paypal accounts
and mobile payment processing.
How peer renting works
site operates a little differently, but all use technology to make renting easy,
secure and relatively inexpensive. On Rentalic, which founder and CEO Punsri
Abeywickrema calls "the eBay for rentals," a user creates an online listing for
the item she wants to rent out, choosing her own rental fee. A juice press could go for $15 a day, a
lacrosse stick for $25 a month. When someone wants the item, he reserves it on
an online calendar, and the two arrange a time and place for pickup. The
borrower comes armed with a secret security code from Rentalic; when the item
is up to snuff, he gives the code to the owner, who punches it into Rentalic's
website or mobile app to transfer the payment via Paypal. Rentalic takes 5
percent of the fee, but "the only time Rentalic charges is when something gets
rented," says Abeywickrema.
"It's totally free to list things."
On SnapGoods, credit
cards are key to payment. As a borrower, you make a reservation online -- the
site specializes in tech gear, such as cameras and iPads -- and enter your
credit card info on the site. Once you pick up the item, you trigger payment by
phone or on the SnapGoods website, and a 7.5 percent fee is charged to the borrower on
top of the agreed-upon price. "That means if I agree to lend you my Canon Mark
5 for the weekend for $100, you'll spend $107.50 total," says Ron Williams,
SnapGoods' CEO and co-founder.
similar process for Zaarly, except in reverse: People post
requests on the site to borrow an item, such as a steam vacuum, or have a chore
performed for them. (It's not uncommon to see digital calls to "Bring me some
ice cream" or "Go to Costco for me.") "You say what you want, what you're
willing to pay and how soon you need it, and it gets broadcast to everyone in
your local community," says founder Bo Fishback. "And you can look at [the feed
of local requests] and see what you have that you can provide to someone else."
The seller or service provider gets paid on the spot, usually by credit card;
the buyer presses pay, and the seller gets a text message letting them know the
money was processed. If you use cash, Zaarly doesn't get anything out of your
exchange, but "if you pay by credit card we guarantee it, and we take a
transaction fee" of 2.5 percent, says Fishback.
It's a concept
that's catching on. Zaarly hasn't hit its first birthday yet, but as of early
2012, it had helped arrange 15,000 transactions among 60,000 users and was
adding 10,000 users a month to its subscriber base.
shudder at the thought of handing over your prized possessions to people you
don't even know, you're not alone -- and you're certainly not without reason. AirBnB, which specializes in connecting
homeowners with travelers who'd like to rent their spare bedrooms or
apartments, had a well-publicized security disaster in 2011, when a San
Francisco woman had her apartment vandalized and her valuables, including
identity information, stolen by a renter.
why person-to-person rental companies are bending over backward to assure you
of their safety. "We have focused on safety from day one," says Williams. "Other
than AirBnB, which understandably recently made safety a much bigger focus,
SnapGoods is the only site that guarantees the goods of the lender. We cross-reference
identity data points and verify payment information in order to manage risk in
our community." And if something does happen to your high-end sound mixing
equipment, SnapGoods insures against the loss.
to Fishback, what makes P2P renting safest is that it's local. "People don't
want to treat their neighbors badly. We have people doing deals with someone
one a block away or with their next-door neighbor. The more local you are, the
safer you get." Zaarly also uses reputation metrics -- reviews, user ratings,
profiles -- to ensure that users are on the up-and-up. It seems to be working.
"We've had one person not get paid so far, in over 15,000 transactions. It's
been almost amazingly safe."
benefits of renting
rent your stuff? You may not make a ton of money, but it could be a nice
sideline, as well as a way to get some use out of things you have sitting idle.
Abeywickrema himself has made more than $300 in the past year renting out his stuff
on Rentalic, including a lawnmower for $5 a day, a disco ball for $5 a day and
snow chains for $10 a week. But he's
even happier about the benefits to other people in the community: "The people
who rented those goods were able to save thousands of dollars by renting
instead of having to buy new."
There may be other tangible benefits. If you rent
your car out on JustShareIt, for
instance, your vehicle will be equipped with RideLink, an OnStar-like device
that lets you unlock, start and monitor your car remotely -- even order a pizza
with the built-in communication device. "Our
trifecta is convenience, security and adventure," says Ali Hart, a JustShareIt representative. "But we're really about connecting people and building community."
Connection is the benefit that Neal Gorenflo, founder of Shareable magazine, which chronicles the
collaborative consumption movement, appreciates most. "I have a retired
neighbor who runs an AirBnB, rents her car out on GetAround
and hosts regular potlucks. The rentals generate extra income, but her main
motivation is to stay connected to her community."
Get to know your neighbors and make a few bucks in
the process? Sounds like a good deal.
See related: Social lending is on the rise, but is it right for you?, Social networking: Your key to easy credit?
Published: April 2, 2012
If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.
Three most recent Innovations, features, new products stories:
Did you like this story? Then sign up for CreditCards.com’s weekly e-newsletter for the latest news, advice, articles and tips. It's FREE. Once a week you will receive the top credit card industry news in your inbox. Sign up now!
Share This Story
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.