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- Turo is a platform that allows car owners to rent out their cars.
- Turo has already filed for an IPO in 2022 but slowed down its efforts until recently.
- Turo was founded in 2009 by Shelby Clark, Nabeel Al-Kady, and Tara Reeves.
- The company is not profitable but is committed to becoming profitable.
What you need to know about Turo
Turo is a peer-to-peer ride-sharing company that allows car owners to rent out their vehicles.
The company is based in San Francisco and operates in the US, UK, Canada, Australia, and France.
Users can select from a wide range of cars. This includes luxury and exotic cars which are a popular option on the platform. Turo is said to be Carbon Neutral Certified, meaning that your carbon footprint is balanced out by greenhouse-gas-reduction projects.
Is Turo ready for an IPO?
Unlike some companies that have been rumored to go public (think Reddit, Starlink, or Redwood Materials) Turo has already filed for an IPO in 2021 with the US Securities Exchange and Commission. However, the economic climate in 2022 put this process on pause.
But Turo does seem serious now, they raised over $500m and according to Axios they are about to start the IPO roadshow in December 2023. Based on this it’s safe to say they’re probably going to IPO.
This doesn't necessarily mean the company is “ready” in terms of its performance, reporting, and other new responsibilities that come with an IPO. Not to mention the company isn’t even profitable. However, Turo’s customer growth from April 2021 to April 2022 was about 92% which is a positive sign.
Who founded Turo?
Turo has three founding partners – Shelby Clark, Nabeel Al-Kady, and Tara Reeves. The company was initially launched as “RelayRides” in Boston in 2009, but shortly after rebranded to Turo. Shelby Clark came up with the initial idea inspired by his own experiences with car sharing and the challenges of urban vehicle access.
What’s the market saying about the Turo IPO?
The market seems to be excited that Turo is going public although there seems to be many people concerned about how profitable Turo can become. Some argue that if it can’t turn a profit in the very best rental markets (i.e. 2021 car rental market) then it might not ever turn a profit. And this is actually a very fair point.
How does Turo make money?
Turo makes money the same way most marketplaces do. They charge various fees to both customers and users of the platform. Some of these include:
- Listing fees paid by the hosts.
- Commission from the rental fees paid by the users.
- Protection fees paid by the hosts.
- Charges for premium insurance coverage paid by the users.
- Other fees and charges for additional mileage, delivery, and pickup services.
Even though Turo has historically been unprofitable some are arguing that there’s a good chance they’ll be able to turn this around as the adoption of the platform grows.
However, some platform users are not convinced that Turo is a great business which can harm it’s growth. Some Reddit users even noted that it’s a stressful and terrible way to make money and would not recommend it to people.
“All star host with 60+ trips, not only was this the worst investment but the most stressful one. Almost every trip is another reason i do not recommend” – jesus2gewd
Who is Turo’s competition?
Source: The Business Model Analyst
Turo is in a competitive market, there are multiple direct and indirect competitors that can make their future a tough one. Here are the main competitors investors need to know about.
- SnappCar: Similar to Turo, SnappCar enables car owners to rent out their vehicles.
- Zipcar: Established in 2000, Zipcar is another alternative to Turo. The company has a fleet of about 12,000 cars that the company all directly owns. It primarily operates in cities and on over 600 college campuses across North America, Europe, Turkey, and Taiwan.
- HyreCar: Like Turo & SnappCar, HyreCar is a peer-to-peer car-sharing platform that allows car owners to rent out their vehicles to others. However, HyreCar focuses on the rideshare and delivery markets. It’s ideal for people who want to earn money by driving for Uber, Lyft, or other similar services.
- BlaBlaCar: BlaBlaCar is a long-distance carpooling service that connects drivers with empty seats to passengers traveling in the same direction. The company operates in 22 countries and has over 100 million members worldwide.
- Uber Rentals: Uber Rentals is a car rental service offered by Uber. The service allows users to rent a car from Hertz, Avis, or other rental companies through the Uber app.
- Lyft Rentals: Lyft Rentals is almost identical to Uber Rentals. You can rent a car through Lyft, usually via Hertz, Avis, or other rental companies through the Lyft app.
- Hertz Corporation: Hertz Corporation is a car rental company that operates in over 150 countries worldwide. The company offers a wide range of vehicles for rent, including luxury cars, SUVs, and trucks.
- Enterprise Holdings: Enterprise Holdings is another large-scale car rental company that operates in over 100 countries worldwide.
- GIG Car Share: GIG Car Share is a car-sharing service that operates in Sacramento, California, and Berkeley, California. The company offers a fleet of Toyota Prius vehicles that can be rented by the minute, hour, or day.
This isn’t an exhaustive list of competitors but by now it’s probably clear that Turo has some incredible competition. And without a strong moat, it will be hard to keep customers loyal to the platform.
Frequently Asked Questions
Turo has not yet gone public, although they have submitted the required details to the SEC. It is highly possible they will have an IPO in 2024 but it has not been confirmed.
The current valuation of Turo is approximately $2.7b although detailed financial information is not publicly available.
Turo is a private company and does not disclose its financials publicly. However, there is wide speculation that the company is not profitable and will not be for a little while.
The data is sourced from a combination of sites like CB Insights, PitchBook, Wikipedia & Crunchbase.
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