10th anniversary discussion with Turo founders
In honor of the 10th anniversary of Turo, CEO Andre Haddad recently hosted a discussion with three other leaders who’ve been with Turo since the beginning. Starting a company is always hard, and starting a marketplace adds further unique obstacles and opportunities. Joining Andre via video chat to reflect on those challenges and celebrate the triumphs of the first 10 years of Turo was Shelby Clark, founder of Turo (founded as RelayRides), Bill Curtis, longtime Turo insurance broker, and Howard Hartenbaum, partner at August Capital and early investor in Turo.
The lightbulb moment
Shelby was living in Boston at the time, back in 2009, and was set to visit family outside the city for Thanksgiving. The closest short-term rental car he could find was over two miles away. As he biked to his rental car through the frigid, snowy Boston day, Shelby passed all these cars parked on the street, just sitting there. And he thought to himself “Why can’t I be driving any of these cars?”
“And it instantly made sense,” he said. “Of course there should be a marketplace where people can share their own cars.” So Shelby did his research and discovered there was nobody doing peer-to-peer car sharing. The reason, he quickly found, was insurance.
The insurance hurdle
“I underestimated the emotional rollercoaster it would be in the earliest days,” Shelby said. “It took a year and a half to figure out the insurance conundrum.” At the time, car sharing was limited to a few small, local, mostly non-profit car sharing services, and Bill Curtis was the de facto insurance guru for those services. Shelby approached him with his idea for a global peer-to-peer marketplace, and although the concept gave Bill pause, he soon saw the opportunity and joined on with RelayRides.
So Bill and Shelby met with insurance underwriters to convince them to insure car sharing. “We spent many months trying to convince them that a peer-to-peer model could be very similar to a standard model,” they said. “And nobody would touch it.” Bill recalled one time they met with a large insurance underwriter who told them “If you find somebody else to do it for you, then we’ll do it.” Persuading insurers to break the tried-and-true mold seemed like a Sisysphean task, but through their persistence and powers of persuasion, they eventually won over an underwriter, secured a policy, and were free to move forward building the business.
Finding a partner to help foot the bill
When it came to raising funds to kickstart the business plan, RelayRides found an enthusiastic partner in Howard and August Capital. “Shelby was great, and the idea was great, if a little crazy. For me this was a bet on a defensible consumer marketplace,” said Howard. Investors are always looking for companies that have the potential to hit it big, and Howard thought this kernel had the potential to rocket past traditional car rental and car sharing incumbent models.
“There was a movement toward collaborative consumption, and we thought it presented a better solution for people who needed a car once in a while,” he said. “This is something that is local and convenient,” and piggybacked on the existing inertia towards sharing assets. In December 2010, right as the sharing economy was starting to take off, RelayRides announced raising its Series A round, led by August Capital.
A decade later
Just this week, Turo reached $1 billion in cumulative global gross revenue (!), an outstanding milestone for any business, and especially considering the early obstacles Shelby, Bill, and Howard had to navigate. Even after the insurance deals were done, and the tech was built, there were plenty more challenges to overcome — growing the supply, refining the customer experience, and building the brand alongside the business, to name a few.
Luckily, millions of adventure-hungry travelers and industrious car owners started finding Turo, and today car sharing is a reliable, go-to transportation option for people across the map!