In this installment of The Webby Awards’ Webby Connect series, we caught up with Marcelo Loureiro, CEO of Spinlister—a sharing economy service that allows users to rent bicycles, skis, and snowboards from others nearby.
Launched in 2012, Spinlister was barely around for six months before its founders decided to change the service's name (to Liquid), change the service's scope (from letting people share bikes, to letting them share everything), and then shut it down entirely. That's when Loureiro – a key investor from the start – saw an opportunity to step in, take it over, and revive it.
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Talk about your experience re-launching Spinlister: What made you want to revive this startup, what was your vision for its future, and what's different about it now than when it first launched?
I’ve always been so passionate for the idea that, when the original founders decided to shut it down and pursue other ideas, I decided to buy the company from them, rebrand it back to Spinlister and re-launch it into the market.
In the future, we will own the global bike rental market (along with other outdoor gear) as a virtual destination. When people think about renting a bike anywhere in the world, they will be able to find any type, size, brand, or price they’re looking for on Spinlister.
The difference now is strongly rooted in our mentality. We are thinking long term, with patience, hard work, and investment. We will not give up because it’s hard. We believe there is significant value in what we are doing. Step by step, bike-by-bike, we are creating a two-sided marketplace. While open for global organic growth, we are focusing on creating liquidity within specific strategic cities and niche markets. We now know the primary drivers, supports, and strategies to grow this business.
What are some of the top challenges to running a business like Spinlister that depends upon people's willingness/desire to share bikes, surfboards, etc., with strangers?
Building trust for both the renters and listers simultaneously is one of our primary challenges. To build this, we provide conditions (verifications, reviews, real photos) that help users feel safe, protected, and give the ability to decline any reservation if they feel uncomfortable for any reason. As a brand we’ve also had to rebuild trust with our users. After a name change and re-launch, we’ve worked hard to restore their faith and trust in the brand. Users are feeling more comfortable, every day, knowing that if anything happens we are here to protect their bikes through our $10,000 insurance against any theft or damage.
Another challenge has been development of our product. We want to provide a service that’s intuitive to use, easy to list equipment, and eliminates common frustrations and communication barriers. The better our product becomes, the more people are not only using it, but also referring it to their friends.
A third, and equally important initiative, is Customer Service. As this is a global business with people on both sides we need to be available 24 hours a day to help them with any problems, concerns, or product related questions.
The last major challenge is supply liquidity. Once a critical mass of supply is reached, every renter can find their ideal bike with every lister getting requests for rentals. This focused liquidity, and supply density, of inventory make the fulfillment of rental requests easy and frictionless.
Why do you think consumers are suddenly so willing to share things with strangers they find via the Internet?
I believe a major part of it is a network effect. People are seeing the media that companies like Airbnb and Uber are getting, hearing positive user stories, and understand the concept of making money and helping people through underutilized assets. The stronger each platform gets, the less perceived risk and stronger willingness to participate.
We do not consider ourselves a competitor for these kinds of systems. Traditional bike-sharing “hub and spoke” models are very specific. They tend to work best for local commuters that ride from point A to point B in less than 30 minutes. Our service is perfect for travelers looking for specific bike types, long-term rentals, or the flexibility to ride without having to dock every 30 minutes. People rarely rent on Spinlister for an hour, making it an entirely different user case.
The sharing economy has witnessed a great deal of growth and attention in the past few years. What does it take for a business to be successful in this space?
The sharing economy space is extremely tough as each platform is basically building a two-sided marketplace. Platforms can only reach liquidity through having scale in both supply and demand.
To build that liquidity, you need to build trust first. To build trust you need time. Unfortunately, operating a company for an extended time costs money. Developing the technology to provide the level of service users require also costs money. Finally, you need money to promote and market the service.
If you love what you’re doing, can handle the hard days that will certainly come, and understand building a marketplace hinges on liquidity, then it comes down to: passion, patience, hard work, money, and finding a niche that makes sense for both sides.
How do you envision the sharing economy space changing over the next five years?
I believe over the next five years you will see an increase in the level of trust, more advanced technology, and a much better user experience that makes transactions reliable and easy.