US-based car-sharing provider Getaround has taken the first step of its global expansion with the acquisition of European peer-to-peer rental platform Drivy for $300 million.
Drivy is the largest and fastest-growing car-sharing service in Europe, with the two companies sharing a business model that allows vehicle owners to provide their cars for rent when they aren’t being used.
The services aim to transform private car utilisation for owners, whose vehicles typically stand idle around 95% of the time.
Getaround currently offers car sharing in 140 US cities and the acquisition adds 170 European locations and 2.5 million users.
The combined company now covers the US, Austria, Belgium, France, Germany, Spain and the UK, with a total of 5 million users.
Both providers have introduced technology for vehicle owners to install so rental customers can unlock cars using their smartphone when their hire period starts, removing the need for a key handover each time. Vehicle hire includes insurance that has been specifically adapted for the peer-to-peer rental market and breakdown cover.
Getaround founder and CEO Sam Zaid (pictured left) said: “We are thrilled to be joining forces with the Drivy team as we move closer to our vision of creating a world where all cars are connected and shared.
“As the leading European car-sharing marketplace, Drivy has built a strong business with products, teams, and values that closely align with ours at Getaround, making for a natural integration for our employees and users.
“Consumers all over the world are embracing the ease, flexibility and freedom that connected car sharing offers.”
Headquartered in San Francisco, Getaround has attracted major global investors including SoftBank, Menlo Ventures, Braemar Energy Ventures, Asset Plus, Triangle Peak Partners, SPARX Group, Toyota Motor Corporation, Cox Automotive and SAIC Capital.
In its latest funding round last year, it raised $300 million from funders led by SoftBank, one of the largest investors in global ride-hailing app Uber, which made its first investment in peer-to-peer car rental. Other participants in the funding round included Toyota Motor Corporation.
The acquisition reflects a focus on consolidation to achieve economies of scale throughout the global mobility services industry.
Last year, Daimler and BMW announced a merger of their mobility services, including car2go and DriveNow, which this year jointly rebranded as Share Now.
The automotive giants' merger creates a massive global customer base of tens of millions of users and substantial efficiencies in back office resources and technology costs.
The Daimler/BMW alliance, which goes beyond car sharing to include electric vehicle charging, ride hailing, apps for parking and booking systems for journeys by a variety of different methods, from cars to bikes, highlights the scale needed to be able to provide a truly global on-demand service.
Last year, car2go, the free-floating car-sharing arm of Daimler, increased its number of members by 21% to 3.6 million worldwide compared to the previous year. In North America, the number of members increased by over 20% to 1.2 million users. During 2018, the 14,000 vehicle car2go fleet was rented out more than 25 million times.
Unlike the Daimler and BMW model, Getaround and Drivy have no fleet costs, as they use their technology to support peer-to-peer rental.
Drivy has also adapted its business model to allow professional fleets to add their vehicles to the platform, expanding its potential customer base to a wide range of markets.
This could dramatically increase demand and the company reports that business use is growing rapidly (it accounted for 18% of demand last year), which would justify the acquisition cost if its growth continues, as each corporate customer is likely to generate significantly more demand than private customers.
Drivy founder and CEO Paulin Dementhon (pictured right) said: “Car sharing will replace car ownership in large urban markets, meeting consumer demands for instant and flexible transportation options, while also making cities more liveable by freeing them from idle cars and reducing congestion and pollution in the process.
“Connected technology, frictionless user experience, and increased car fleet density are the keys to this evolution, as they make it more convenient to use a shared car than your own.”
Dementhon will remain in his role as the CEO of Europe, as will the broader Drivy executive team, to oversee European operations and drive growth.
The Drivy team includes 130 people in offices in Paris, Berlin, Barcelona and London.
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