The Signal: Grover is a Berlin-based startup that just raised a further ~$70m to grow its electronics rental business in Europe and expand to the US.
The company, which rents out consumer electronics for a set monthly fee, has increased its subscriber base by 50% in the last 6 months from 100k to 150k active subscribers. They also grew their ARR by 2.2x to €50m (~$60.3m) in 2020.
Opportunities: Although companies like Lumoid failed to make the electronics rental model work in the US years ago, the pandemic has inspired a new appreciation for financial flexibility.
There were ~66k monthly Google searches for “rent a laptop near me” in August last year, according to Keywords Everywhere (currently down, but still significant, at ~8k searches/month).
For consumers who can’t or don’t want to commit to expensive tech, the rental model is a perfect solution. It also works well for fickle consumers who want to upgrade to the newest iPhone as soon as it comes out.
It’s a nifty option for those who want to try before they buy. London-based startup Wonder will let you rent new tech from startups. For $49 you can rent the Elvie wearable breast pump (worth ~$345 new) for 7 days, plus $3/day thereafter. You could also rent the Muse 2 meditation device (worth ~$330 new) for a week also for $49, plus $5/day afterward.
The trend toward electronic rentals also ties in nicely with massive opportunities in e-waste and the circular economy, which we reported on earlier this year. Electronic goods recycling is a $16B industry growing 8.7% YoY.
Specialize: In the first 9 months of 2020, Grover had rented out thousands of electronics across Germany, Austria, and the Netherlands, including 18k+ smartphones and 6k pairs of AirPods.
While Grover has a wide range of electronics, there’s an opportunity to provide a more specialized offering in other categories like wearables, gaming, and cameras.
Camera equipment in particular is an interesting niche. The Instagram/TikTok age is ushering in a new wave of semiprofessional (we’re being generous) photographers and videographers who’ll want access to affordable equipment on an ad hoc basis.
UK-based startup MPB is meeting this need with their used-camera marketplace. The company raised ~$69m last month.
Another niche worth exploring is fitness equipment, which increasingly falls into the electronics category with the likes of Fitbit, Peloton, and Mirror.
Google searches for gym equipment are still high after coming down from a peak at the start of the pandemic, according to Keywords Everywhere:
- “Rent a treadmill”: 14.8k searches/month
- “Rent gym equipment”: 8.1k
- “Rent exercise bike”: 2.9k
There’s an opportunity to provide expensive fitness tech to people who aren’t ready to commit, or who want a more flexible option than the gym.
B2B: Grover enjoyed a 103% increase in assets rented by business customers from September 2019 through September 2020 -- the result of a 2,000% increase in traffic to their B2B store in the first half of 2020.
There’s clearly demand from businesses and freelancers for leased office equipment (e.g., laptops, monitors, headphones), as well as speakers, lighting, tablets, and VR gear for events and company retreats.
You could also partner with Airbnb hosts to provide their guests with add-on options like a drone, e-bike, or Xbox.
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