In today’s world it seems there are fewer and fewer industries exist where there isn’t some sort of peer-to-peer model emerging for access to the goods needed to get a job done. Every segment is creating its own “Airbnb for X,” which you can attribute to a growing acceptance that as we all become connected, there’s little reason for each of us to own all the same stuff when we could just borrow what we need from a neighbor.
Apparently that theory even holds true for the construction industry, where a little startup called EquipmentShare is making it easier for construction crews to make rent equipment they don’t own from other contractors, while also allowing them to make money off their own idle gear.
Contractors can spend hundreds of thousands of dollars on a piece of equipment they might need for one job, and then have it sit idle for months or years while waiting for the next job that they’ll get to use it. Otherwise, they might have to shell out thousands, or even tens of thousands of dollars a month to rent the same gear from a nearby equipment rental company.
The company was founded by brothers Willy and Jabbok Schlacks, who have been in the construction industry for more than 20 years and grew tired of facing the constant buy-versus-rent conundrum when it came to the equipment they needed. They were joined by Jeff Lowe, Matthew McDonald, and Brad Siegler, all of which are from the Missouri area.
Construction equipment rental is a $40 billion a year industry. But according to Willy Schlacks, contractors own about three times the amount of construction equipment that is owned by the rental companies. That means there’s a ton — literally, no pun intended — of excess inventory for contractors to take advantage of, if only there were a more efficient way for them to connect with one another.
EquipmentShare hopes to provide a platform for contractors to find that unused equipment, while also enabling them to make money off assets they own that are otherwise sitting idle.
To do so, the company has created an easy way for customers to post and describe their available equipment and set a rental price for it. For renters, the EquipmentShare platform provides a way to hunt for the equipment they need from others nearby. To ensure that everything goes as planned, the platform also handles all payment processing.
Because contractors are renting out equipment that is not being used, EquipmentShare prices are typically at least 30 percent below the price you would pay to a traditional rental company. However, since the platform provides the same sort of two-sided rating system as Airbnb and other peer-to-peer platforms, there’s an incentive for equipment to be well-maintained, and for contractors to not abuse the gear they’re renting.
In that way, EquipmentShare is hoping to provide a better experience than other peer-to-peer alternatives out there — mainly Craigslist, which is how many contractors find equipment to rent today. But when it comes to providing a peer-to-peer marketplace for this type of equipment, there are a number of hurdles to overcome, such as verifying the identity and licenses of contractors, while also insuring against damage to equipment that is rented out.
While limited only to the Missouri market currently, EquipmentShare hopes to be able to be in more markets soon. As part of Y Combinator, the team is paying attention to how other peer-to-peer services expanded their businesses, although Schlacks admits that there’s not a ton of overlap between his construction startup and a lot of the other software-type businesses that go through the program.
That said, where there’s a huge market opportunity — and construction rental is one — there’s usually a way for technology to make it more efficient. EquipmentShare hopes to provide the platform for doing so.