According to serial entrepreneur Jeff Cavins, more than 35 million people each year look to rent an RV -- 38 percent of them so-called millennials. Yet they often walk away from the experience empty-handed. The reason, he says: there are fewer than 100,000 commercial owned vehicles available from traditional rental services.
Cavins says that his San Francisco-based company, Outdoorsy, is beginning to address this issue by enabling owners of the 14 million privately owned RVs in the United States to rent them to users, à la Airbnb.
The vehicles are mostly sitting around collecting dust anyway, says Cavins, who cofounded the company in late 2014 after heading up seven previous companies -- two of which were publicly traded.
"Americans desperately want time off, but what happens is they'll buy a camper van, they'll use it year one, then use it again maybe one week that second year," says Cavins. "In the meantime, it's sitting in storage, with the owner often dealing with both a mortgage and insurance payment. By year three, people go back to the dealership and say, 'We're done,' and the dealer says, 'I'm sorry but that vehicle you paid $100,000 for three years ago is now worth $40,000.'"
Intuitively, the platform would seem to make sense. RVs are unaffordable for most people. Storing them is a hassle. And people are increasingly interested in reaching places where home-sharing sites and hotels cannot take them. Think Burning Man, for example, or the annual Coachella Valley Music and Arts Festival.
But Cavins said venture investors "didn't get it," when he began pitching the idea to them several years ago. While he secured meetings with with all the right firms, he said he was repeatedly ushered politely out the door by people who deemed the idea too risky.
In fact, Cavins says that he and his cofounder and life partner Jen Young wound up funding the company for its first year, platform up the platform with two "phenomenal" developers to the point that within a year, VCs had produced four term sheets -- all of which he turned down. ("I didn't want to give my company to them," he says.) Instead, his next move was to enroll the company in NFX, a venture firm and accelerator that works with a small group of companies each year that are focused on "network effects," or ensuring that both sides of a marketplace keep coming back in larger numbers.
The time spent in the program paid off, says Cavins. "At NFX, we learned to professionalize the platform. You think about power sellers on eBay and real estate firms on Zillow and property management companies on Airbnb. What we needed was to get [partner companies] on the platform," which Outdoorsy has begun to do.
Outdoorsy has a cross-promotional partnership, for example, with Kampgrounds of America, the network of campgrounds known as KOA, which has roughly 500 locations in North America. "They sell the dirt and space and Outdoorsy brings the hotel room," says Cavins.
Cavins says Outdoorsy is also finding users through Facebook ads, word of mouth, as well as via "emerging power sellers," as Cavins calls them. He points to a single mother in Huntington Beach, Ca., who has acquired five RVs and is putting them to use to pay for her daughter's law school tuition at UC Berkeley, and another owner of a leisure van who made $50,000 last summer. "It's almost like a cottage industry of folks who are running their businesses on our platform from their kitchen tables," says Cavins.
Altogether, says Cavins, Outdoorsy now has 256,000 users and he says it's growing by by 21,000 users a month. RV owners set prices, keeping between 80 percent and 94 percent of subtotal based their "trust" ranking scores on the site, and on how many units they are renting. (The more they rent, the more they keep.) Outdoorsy meanwhile always keeps at least 10 percent of the overall total rental price, in part to pay for on-demand insurance, which it secures for renters through several partnerships, along with unlimited road side assistance.
Its momentum is such that Outdoorsy, which now employs 50 people, just landed a sizable amount of Series B funding: $25 million led by Aviva Ventures and Altos Ventures, with participation from Tandem Capital and Autotech Ventures. (The latter had chipped into the $6.5 million that Outdoorsy had raised previously -- much of it from Cavins, who'd also taken earlier checks from NFX, Tekton Ventures, and numerous angel investors.)
That's not to say that Outdoorsy isn't without its challenges, of course. First, a look at some of the inventory Outdoorsy has unlocked shows a lot of pick-up trucks, which would seem to stretch the definition of recreational vehicle. There are also at least 10 other RV rental companies, including RV Share, which also refers to itself the Airbnb of RVs.
And Outdoorsy as Airbnb itself with which to compete. Along with homes and other vacation rentals, Airbnb connects its users to RVs and campers.
Cavins argues that unlike these companies and Airbnb in particular, Outdoorsy's users "connect emotionally" because unlike with Airbnb, where hosts and guests often never meet, Outdoorsy's "hosts" have to meet renters in person in order to train them how to use their vehicles. (He insists that he has seen "families become best friends" and even "people get married" as a result.)
Airbnb has also somewhat famously had issues with renters destroying property. Asked how Outdoorsy handles the same challenge, the company explains that its insurance is "episodic" commercial insurance that covers all states, provinces, jurisdictions, and territories.
Once a consumer goes through Outdoorsy's DMV check -- the company says its software can do this in 20 seconds -- he or she is approved for the insurance and covered up to $2 million for a trip. The insurance protects the owner, the renter, and any third party in the event of an accident.
In the meantime, like Airbnb, Outdoorsy is also very focused on partnerships. In fact, says Cavins, the company is working with numerous event organizers with the hope that in the not-too-distant future, when a customer buys a ticket a Nascar race or to a music festival like Coachella or Bonnaroo, that person can also book a parking pass and an RV stocked with a favorite champagne.
"Those partnerships are coming," says Cavins.
Pictured above: Cofounders Jen Young and Jeff Cavins. Young is the company's CMO; Cavins is CEO.