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Zipcar Founder: Why Sharing Is the Future

Zipcar founder Robin Chase discusses the Avis acquisition, the next big thing in car-sharing, and her latest venture, Veniam.

Michael Edwards

"Making customers feel like they have input and a stake in the game really makes them want you to succeed." –Robin Chase, co-founder

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Last week, when Avis announced its intention to acquire Zipcar for $500 million, founder Robin Chase wasn't too surprised.

When Chase started Zipcar in Cambridge, Massachusetts in 2000 with Antje Danielson, the duo re-envisioned the way people use cars in urban areas. Instead of lengthy waits at rental car counters, Zipcar pioneered the use of technology that allowed customers to reserve cars online, using membership cards to unlock vehicles at specific locations. 

It quickly found a niche with a mostly young, hip customer base who instantly grasped how grabbing a car for an hour or two from a nearby spot could fit into their busy lives. 

Zipcar has since gone from being an interesting idea to the leader in car sharing, with about 760,000 members, a public offering in 2011, and $300 million in annual revenues. But competitors abound, both scrappy startups and big car rental players.

Chase spoke with Inc. staff writer Jeremy Quittner about her reasons for leaving Zipcar in 2003, her other startup ventures, and the latest big ideas capturing her attention. Following is an edited version of their conversation.

What do you think about the sale of Zipcar to Avis?

I used to joke when I was in the first years at Zipcar, when the press would ask me where do you see the company in 10 years I would say in an anti-trust suit because we will be a dominant player across the states.

So I always had very high expectations for us. I could picture a kind of Godfather scene where I would be lying in my bed and the car rental guys would be at me with their Uzis. I always knew we were cutting into the car rental business model. I also knew it was the future and it is about to become even more so the future as we go forward. As we move towards a more urban world with 50% or so living in cities today and 70% by 2030, there is no question we cannot and don’t want as individuals to have one car per adult or adult household.

Will Zipcar lose its street "cred" as an Avis subsidiary?

Avis has had 12 years to watch us and they have been watching really closely over those years, and one likes to imagine that they could pull it off.  The challenge they are facing is the same one faced by any big company acquiring a small innovative one.

What lessons do big companies have to learn?

I think that all companies today can and should be really recognizing the fact that we are in an innovative, co-creating new economy with what was formerly known as "the consumer." That relationship has transformed and I think everybody needs to figure this out. You are looking at 30 different sources of information and jumping between these and commenting and tweeting and interacting and this is the way we want to interact with all sorts of services in our lives, we are part of that creation. No matter what we are consuming, we feel the need to be co-creators.

When I founded Zipcar we were very community focused, we had lot of parties where we provided the transportation and they provided the potluck picnics or the destination,  and whenever I needed cars or parking locations or new employees or surveys of what cars to buy, I went to my customers, all the time they were front and center and part of building that company.

Why did you leave Zipcar? Some reports say you were forced out.

I was not fired. I had just raised $7 million in a very, very hard environment and I will say I had family issues. My father died within a couple months of that and my daughter, Cameron Russell, went on to become a very famous supermodel at a young age, so I really needed some time.

I had a really hard time raising the last round of money and it was exhausting. The company was doing fabulously well, it was the most successful it had been since we launched it, and customers loved it and it had grown really well month over month.

The fall of 2002 was a nuclear winter for venture capital. It was constant push, push, push, and I was flying around working hard and the company was running out of money, so it was very stressful. There was a huge psychological toll to being CEO, and it takes a lot of your time raising money when what you really want to be doing is running your company.

I still have my founding shares and I've added some shares, but there's been a lot of dilution.

You started Buzzcar in 2011. How is it different from Zipcar?

Traditional car sharing will only place cars where it can get a return on investment, such as dense urban areas or in university towns where you can guarantee that. Buzzcar shares cars in any environment, in any destination. If your car [has] excess capacity, you can sell that and if someone rents it once a year that's great, it is all upside. You can rent cars anywhere. In France we have 1,800 cars across the country and many rentals in places where you would never see traditional car rental or car sharing.

The thing about transportation is it's in a continuum. Buzzcar is complementary to car sharing and car sharing is complementary to car rental.

What else have you done?

I have done a lot of policy work in the last few years on a national and international level. I am very tied into the wireless and Internet and innovation communities and my expertise is much deeper than had I remained CEO of Zipcar.

The connected car is now widely seen as an open platform on which you put many things and I want to take a lot of credit for the way this is being played out, with millions of dollars of investment dollars because of the work I have laid out. The U.S. government has done a lot policy and emergency services [work] on Mesh networking, of which I have been a huge champion for years, and I have done a lot of work in Washington pushing that forward.

Mesh networking is where your device, whether laptop, cell phone, or box in your car is not just receiver of information, but a router, it is like a mini cell tower. The device itself can create a mini-infrastructure without needing anyone else. It is something I have been pushing in transportation for a long time. I've co-founded a company in Portugal that is doing this, called Veniam. We are building the largest wireless Mesh nework in the world, and it is very exciting.

It's an Internet of devices rather than an Internet of networks. Mesh networking lets local communication and data stay local and hop over each other so it is a multi-HOP situation. Instead of my phone call going to a cell tower, it stays local. That will transform machine-to-machine communication as well as vehicle-to-vehicle communication as well as the cost of our communications in general. We will each be leveraging each other's excess capacity of wireless infrastructure, and we can transform and provide a whole new economic engine, and we are right now at the cusp of that.

Anything else about Zipcar?

 I laugh, because when you are out raising capital, people ask what is the exit strategy. I always laugh at that question, because there are only two answers, either you're going to have an IPO or someone is going to buy it. And I'm laughing now because Zipcar did both.

Last updated: Jan 7, 2013

JEREMY QUITTNER | Staff Writer | Staff Writer, Inc. and Inc.com

Jeremy Quittner is a staff writer for Inc. magazine and Inc.com. He previously covered technology for American Banker and entrepreneurship for BusinessWeek.




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