Sharing Economy for Crashpads – a Viable Business Idea?

Sharing Economy for Crashpads – a Viable Business Idea?

Wouldn’t it be great if we can rent out
our crashpads to make some extra cash instead of letting it sit in the garage doing nothing? Wouldn’t it be great if we could easily
find crashpads to rent when we fly to another place to climb? I did a customer survey by talking to my climber
friends about the idea, and almost all of them are super excited about it, and I have an
engineering background, so I can easily code up an app to serve as an MVP. Similar business ideas of sharing economy,
like Airbnb and Uber, get millions of funding by investors. So it looks like a no brainer to pursue this
business idea, right? Not so soon yet. The number one thing we should do prior to
pursuing our business idea is to google around and see if someone else has done similar things. You might think, “dude, obviously” but
you have no idea how many aspiring entrepreneurs make this type of mistake and end up wasting
a lot of their own time. Anyways, I googled around and I discovered a
company called “GearCommons.” They were doing the exact same thing I thought
of, but in a broader sense, sharing economy for outdoor gears. The founders, Michael and James, launched
the company at around 2013 but they couldn’t get any traction and eventually they shut
the company down at around 2016. Michael wrote a Medium article, detailing
why the company failed and what he learned from it. It is so insightful that I feel compelled
to share it with you. I have tremendous respect for what Michael
and James went through and here is the summary of their two main insights. Number 1: Solve the number one problem, and
not the number two problem. According to an industry survey, the number
one reason why people don’t go outdoors often is because they don’t have enough
time, and the number two reason is they don’t have access to the right gear. However, when solving the number 2 problem
with the sharing economy approach, it actually amplifies the number 1 problem because of
the additional time needs to spend on emails, texts, pickups, and returns. Also, the owner of the gears makes around
30 dollars over a typical transaction, an amount that is not worth going through all
the trouble. Number 2: People just don’t rent outdoor
gears that often. Revenue from rentals typically are less than
1% of the total revenue of a typical gearshop, which means the profitability and market size
are microscopic to begin with. From their experience, people were stoked
to share their equipment with strangers on their platform. Supply was high but the demand was very very
low. Typically, people only used their service
one day a week for their weekend trips, and most people only go on an outdoor trip for
around 1~2 times a year. As for people who went outdoors more often,
they had their own gears. With such a low usage rate and low margin,
it was impossible to keep the business alive. So based on these insights, sharing economy
for crashpads is not a viable business idea. Thanks for watching. Make sure to like and subscribe, and comment
below if you are interested in an in-depth interview with Michael and James. If there is enough interest, I will try my
best to make it happen. See you in the next video.

16 thoughts on “Sharing Economy for Crashpads – a Viable Business Idea?

  1. I wanna see that interview. It’s interesting to learn about how others have failed. It gives you an insight to how things outside of your knowledge work.

  2. Very interesting idea! Would be super cool. For example: Iam currently in france on vacation. But the other guys dont climb and we used our car to get here. Thats why i dont took any crashpads with me, although i own one. I was in this "got no pad"-situation many times before even as a more or less experienced climber who has his own gear. I think, this thing could work, would finance itself but it will not make profit. In this situation, wait and the global climbing/bouldering boom will do the rest. More experienced climbers in my situation mean that you will slowly make profit. But for the start youll need help and smart promotion, so that the experienced climbers get to know the service. Which means, ask nice people with a viewer basis to promote a little bit. The climbing community is nice, i think some people will do it for nothing cause the idea is nice.

    The only problem i can see: it will work with crashpads, not with other safety gear. I will never use a rope or harness from a private person i dont know. I cant rly explain this, I just feel like this. Crashpads are okay, you can see if they are okay, check this in less than a minute. But checking a harness and 50 m of rope? Naaaaah too much effort and trust, for me at least.

  3. Really informative and like your vids. 🙏Happens all too often for me, too-I have a light bulb moment, research, then its already in the market or failed. One of these days…😜 Until then, just keep climbing. 🤙

  4. People tell you want you want to hear. People tell you they want things that they don't actually want. People don't know that they want. Be careful.

  5. There is certainly an “Air B n B” … this is a bad idea charm to this idea. I would think that there is a better market in finding an crazy cheap way to manufacture a crash pad.

  6. Well at least you've realized it was a bad idea! Imagine if you didn't know it was a bad idea and did it anyway. Think about how much time would've been wasted!

  7. Favorite video. Im an entrepreneurship nerd that just got into climbing, really interesting to see some overlap with my passions. Subing.

  8. yeah, how about stores near famous bouldering sited which have crash pads for rent, like font and so on?

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