When Jeemon Jacob moved to Gurugram to join an information technology company, he rented a two-bedroom flat with four colleagues. Instead of buying furniture and electronic goods, they decided to rent them — four beds, a refrigerator, a television, and a study table for just Rs 2,500 a month from a start-up.
Jacob is learning to play guitar and has rented one till he can save enough to buy it. One of his flatmates has rented a treadmill, while another rents a bike for weekend trips. Their boss, Venkat, rents a car from Zoomcar on weekends and uses cabs on weekdays.
Welcome to India’s sharing economy, which is fast evolving beyond categories like travel aggregation (Airbnb) and ride hailing (Uber) to furniture rentals, car and bike sharing, peer-to-peer lending, co-working, co-living and even book sharing.
It’s early days yet, but a host of start-ups like Rentmojo, Furlenco, Rentickle, GrabonRent (furniture and appliance rentals), Zoomcar, Revv, Vogo (car & bike sharing), Coho, Platio (co-living), CoWork and AWIFCS (co-working) are seeding India’s fledgling sharing economy.
Investors point out that in a classical definition, sharing is always peer-to-peer, such as in Uber (in most markets) or Airbnb, but not everyone agrees with this. Vineet Chawla, founder, Rentickle, says in furniture rentals, the same asset is being used by several people by converting the capital expenditure into operating expenditure.
Furniture for lease on GrabonRent website‘‘What are these companies trying to do? They are trying to bring down the cost of services and make them much more accessible for people, who can use a car or a furniture by paying 2 per cent of the value as rent,” says Shubham Jain, chief executive officer & founder, Grabonrent. “Companies are trying to finance the product and provide access. Access is the first step towards sharing; the access economy will lead to the sharing economy,” adds Jain. He believes that many of the sharing economy businesses have to start as access businesses.
The fundamental tenet of a sharing economy is assets that are underutilised (such as a spare room) and can be monetised. He says that in India, 90 per cent people sell used furniture at 60 per cent less than the potential realisable value. People, he adds, will start investing in these once they see others are able to generate a monthly income. Categories like furniture will go to access first before moving to a sharing economy. “All these categories need to reach a stage where a supplier relies on it for a monthly income (like Airbnb or Uber). Once enough people believe in that, they will invest and create the supply and the sharing economy will happen,” says Jain.
Starting from Noida, Pustakkosh now rents out books for higher education in seven cities and commands 50,000 subscriptions. Along with books, it now rents rackets and musical instruments.