Estonians have always been rather individualistic and that also applies to car ownership; one company now wants to change that.
Tauri Kärson, an Estonian entrepreneur, founded the peer-to-peer car rental company, Autolevi, in 2012 after graduating from his studies in logistics and researching the habits of Estonian car owners. “One great example of how Autolevi works, is a car owner from Autolevi’s community, who rented out his car in Tartu for two weeks and found the experience very positive – he saved money on gas, earned extra revenue from renting the vehicle and rode a bicycle to work – thus ended up losing four kilograms (nine pounds) in the process,” he says.
He argues that alongside the smarter use of money – people would otherwise invest in their cars – car sharing has a huge impact on our environment. “It takes around 35,000 tons of CO2 to produce an average car like Ford Mondeo (Ford Fusion in the US – editor). Instead of owning one, it can be so much more convenient if in need of a vehicle, you rent a car within 10 minutes of your home instead. They have done incredible research on this in the US, one of the findings being that just one single shared car takes 15 cars off our streets,” Kärson says.
He also found out from personal experience that peer-to-peer car rental is a good chance to earn back a part of the car’s cost. “I studied logistics and noticed that this idea is already working well in other countries in Europe and also in the US, for example. Estonia is, of course, very different, but we are definitely moving in the direction of greener thinking as well. I talked to a couple of friends who were interested in the idea and we started gathering data and doing market research,” he recalls. “We interviewed around 200 people in person, especially car owners, asking them if they would rent out their car to other people and what would motivate them to do so.”
Kärson first found two like-minded partners – one took care of the IT side and the other one helped with legislation, looking into risk management. The project started to move and the feedback was good. “At first, we were all doing it as a side project and worked on it in the evenings, after our daily jobs. In just a few years, I committed to Autolevi full-time and it has grown massively. We are also active in the Latvian and Finnish markets now.”
Green thinking and social change
The founder says his main motivation comes from green thinking – after having studied logistics, he didn’t like the fact that there are so many resources staying idle that could be put to good use instead. He wrote his thesis on the same topic, studying the habits of car owners and gathering data on the average costs of owning a car in Estonia. A very high number, around 80 per cent of the car owners, said that someone else outside their close family circle had already borrowed and used their car in the past.
“Starting a positive change in the society has also been very motivating to me – how to bring your idea into action and implement it into everyday life,” Kärson notes. “Autolevi is focused on using the resources wisely, as well as building trust in a community – encouraging people to trust each other more, to have more open communication, and being smart about your money. Owning a car has many accumulating costs that add up to much more than people usually think it does.”
Kärson is also passionate about inspiring entrepreneurial mindset and stimulating people to be more aware of their costs. He believes the future to be in peer-to-peer services. “In the past, you had to buy everything for yourself. The society is definitely moving in a more flexible direction – you don’t have to own everything, but everything has to be accessible to you when you need it.”
He brings out other examples of micro-entrepreneurship, such as renting out a summer home or even peer-to-peer sharing of lawnmowers. “This should give people more sense of security as well as teaching them how to put their investments into good use. Many things amortise or lose their value fast – for example, a brand-new car loses 20 per cent of the value right after driving out of the car store. It’s not only wiser to buy a car that is used a couple of years, but also to think of clever ways how to get the money invested in your car back,” he says.
As for his own company’s future, Kärson says Autolevi has already reached a large community of car sharers in Latvia, where it is also the first and only car sharing startup. The next goal is engaging the Finns. “There are two similar competitors in France and the Netherlands now, but our best role models are actually the companies in the United States – they definitely provide well-rounded services that are tailored to different target groups.”
According to Kärson, today his company has over 900 cars in its database and over 20,000 users, who have different lifestyles and needs. “Some rent a car for a weekend road trip, others need a substitute vehicle while their own car is in repair and sometimes you just need a specific vehicle, for example one that fits all your purchases from a store to bring back home.”