Rent-out-your-car company gets €31-million to expand
Drivy, a French start-up that lets people hire out their cars in much the same way Airbnb runs a market for houses, said it has raised €31-million to fund its continued expansion across Europe.
Already operating in France, Germany and Spain with 36 000 cars on its system, Drivy will use the new money to expand into many more cities, including London, said Paulin Dementhon, Drivy’s chief executive and founder.
The company plans to open in three new markets in 2016. Italy, the Netherlands, Portugal and Poland may be on the cards, said Dementhon.
Drivy has struck an insurance deal with Allianz SE to offer protection for drivers who use its service, covering them for civil liability and bodily injury, as well as the owner of the car for damages. The cost of this contract is built into the rental price.
Dementhon said Drivy would also be looking into offering more vans and small trucks for rent. “The market for commercial van rental is almost as big as the market for cars,” he said.
Although Drivy initially targeted individuals wanting to earn extra cash from their personal cars, Dementhon said the company has begun to attract entrepreneurs and small businesses that are using it to make money renting fleets of vehicles.
Dementhon said the average rental length is currently three days. In addition, Drivy is seeing more demand for daylong and even half-day rentals, he said.
In an effort to improve services, the start-up has been trying to find ways to make the rental process as instantaneous as possible.
To that end, the company is aiming to install its Drivy Open system – a piece of hardware installed into a car’s door locking mechanism that allows customers to unlock a vehicle with an app – in more of the vehicles in the system. It was introduced in December last year, and only 300 cars in Paris and Berlin currently feature the app.
Other major automotive players are exploring similar ambitions and considering following Drivy’s lead. BMW’s Mini brand plans to build similar devices into its latest cars to allow owners to rent them.
Cathay Innovation, the venture-focused arm of Paris-based private equity firm Cathay Capital, and Nokia Growth Partners, the venture arm of the Finnish telecom company, led the latest investment in Drivy. Bpifrance Ecotechnologies Fund, Via-ID and Index Ventures, which invested in the company previously, also participated in this round. The start-up has now raised a total of €47-million in four investment rounds. – © Bloomberg