New Peer-to-Peer Service Revs Up Equipment Rentals
A San Francisco start-up hopes to save U.S. contractors billions of dollars in equipment rental fees and lost revenue with the rollout of a new online equipment-rental market model.
Incubated in Silicon Valley, YardClub.com aims to expand the service to Southern California, the East Coast and cities throughout the U.S. in the next six months.
"We are hiring like crazy," says company founder Colin Evran.
The online rental concept allows contractors to lend idle equipment to other area contractors at 30% to 40% cheaper than traditional equipment-rental companies, according to club members.
Yard Club is based on the same peer-to-peer social media model that has revolutionized the travel industry and other sectors. For example, Airbnb, founded in 2008, currently lists more than 600,000 private apartments and houses that are available to rent to more than 11 million users.
Since its launch in 2013, Yard Club has attracted the attention of major tech-industry investors. Silicon Valley-based venture capital firm Andreessen Horowitz, a big investor in Airbnb, and former eBay executive Michael Dearing led the initial seed round of capital investment for Yard Club in July.
A graduate of Stanford University's MBA program, Evran was inspired by his own family's 40-year construction legacy.
"It's a tough business [in which] the average operating margin is about 3%," Evran says. "If you choose to own your own equipment, you have to make big up-front investments with little certainty on whether you are going to win work once a month. On the flip side, renting equipment can be pretty expensive."
To test the concept, Evran initially funded the start-up out of his own pocket and brokered deals over the phone between a pilot group of about five contractors in the Bay Area.
"We took that very lean way of testing the idea, got a tremendous amount of feedback and started building the product and service around that," Evran says.