Car Next Door began in 2012, founded by Will Davies and Dave Trumbull, with a simple goal: to help people rent out their unused cars to others.
This peer-to-peer car-sharing platform stood out for its focus on reducing carbon emissions. It also provided an affordable and easy way for people to access vehicles.
The idea offered a practical solution for car owners to earn extra income while helping the environment.
In February 2016, the duo took their idea to Season 2, Episode 2 of Shark Tank Australia. They asked the Sharks for $300,000 in exchange for 4% equity.
Their pitch highlighted the business’s scalability and its potential to make a significant environmental impact. Most Sharks hesitated due to concerns about the valuation and competition.
However, Steve Baxter saw the potential and struck a deal, securing a 4% stake in the company.
After appearing on Shark Tank, Car Next Door grew rapidly. By 2022, the platform had expanded to include 5,500 cars and 137,000 active borrowers.
It had also facilitated nearly 1 million trips, demonstrating its widespread adoption. This impressive growth caught the attention of Uber, which acquired the business for $105 million.
The acquisition was a testament to the company’s success. Along the way, Car Next Door gained investments from major players like Hyundai and Caltex, further solidifying its position as a leader in car sharing.
Every Shark Tank story offers lessons, and Car Next Door’s success is no different. Its journey provides a wealth of insights for entrepreneurs looking to grow and scale their own businesses.
So, are you ready to take your business to the next level? Let’s dive into the 5 simple business lessons you can learn from Car Next Door and see how you can apply them to your own entrepreneurial journey.
5 Simple Business Lessons You Can Learn from Car Next Door
1. Start with a Clear Mission and Purpose
Car Next Door’s founders built their business around a clear mission: reducing carbon emissions and promoting environmental sustainability. This purpose-driven approach made their business stand out in a crowded market.
It also attracted eco-conscious customers, investors, and partners. Their mission wasn’t just about profit—it was about making a difference.
“We didn’t set the business up to make millions of bucks. We set it up to reduce carbon emissions.”
Will Davies
Solution:
The founders aligned every aspect of their business with their mission. They created a peer-to-peer car-sharing platform that allowed car owners to earn money while reducing the need for individual car ownership.
This innovative solution addressed a practical issue and appealed to environmentally conscious users and strategic partners like Hyundai and Caltex.
What’s your mission? Define a purpose that goes beyond making money. Focus on something your customers and partners can believe in. Let that purpose guide your decisions and inspire your journey.
Takeaway:
Having a clear mission can set you apart. By focusing on a bigger goal, like Car Next Door’s commitment to sustainability, you can build a brand that connects deeply with customers. A strong mission can also drive long-term success.
2. Leverage Partnerships to Scale
Strategic partnerships were key to Car Next Door’s rapid growth. Collaborating with established companies gave them the resources, visibility, and credibility they needed to expand their business.
“We’ve now got all the technology, and we’re going to be able to push forward a lot faster than everyone else.”
Will Davies
Solution:
By partnering with major players like Hyundai and Caltex, Car Next Door gained funding and additional industry support. These partnerships reinforced their credibility, which helped them attract $18.6 million in total funding.
This growth enabled them to scale from 350 cars in 2016 to 5,500 cars in 2022, with 137,000 active borrowers by the time Uber acquired them.
Could a partnership take your business further? Find brands that align with your goals. Use their resources and expertise to grow faster and stronger.
Takeaway:
Partnerships can be game-changers. By teaming up with trusted names, you can amplify your business’s reach. Strategic alliances can also provide a foundation for long-term growth, just like Car Next Door.
3. Focus on Scalability from the Start
From the beginning, Car Next Door designed their business to grow. By building scalable systems, they ensured their platform could handle increasing demand without compromising quality.
“The network effect is essential for our success.”
Will Davies
Solution:
The team developed a user-friendly platform with features like GPS-enabled lockboxes and online bookings. These systems allowed them to expand quickly while maintaining efficiency.
Their early focus on scalability paid off. They grew their revenue from $980,000 in their first financial year to $2 million, achieving a 33% gross profit margin of $675,000.
Is your business ready to grow? Build systems that can handle increasing demand while delivering the same high-quality experience to every customer.
Takeaway:
Scalability is crucial for long-term success. Plan for growth from the start. When the opportunity arises, your business will be prepared to expand without limits.
4. Innovate with Technology to Gain an Edge
Car Next Door used technology as a key differentiator. By solving logistical challenges with innovative tools, they gained a competitive advantage in a crowded market.
“We’ve got a patent pending over the concept of using an electronic lockbox in conjunction with a GPS tracking device to facilitate car sharing.”
Will Davie
Solution:
The company developed a patented system that combined GPS tracking with electronic lockboxes. This innovation made car-sharing simple and secure. It also reduced operational costs and enhanced the user experience.
Their tech-focused strategy positioned them as industry leaders. It played a significant role in their acquisition by Uber for $105 million in 2022.
Is your product solving a real problem? Use technology to create innovative solutions that make your business stand out.
Takeaway:
Innovation sets you apart. By addressing customer needs with unique, tech-driven solutions, you can secure a leading position in your market. Car Next Door’s approach demonstrates how innovation can lead to success.
5. Be Persistent and Resilient
Car Next Door’s success didn’t happen overnight. The founders faced challenges and skepticism but stayed committed to their vision. Their persistence showed that determination pays off.
“If you’re setting up a startup, it’s going to be a gruelling 10 years of your life.”
– Will Davies
Solution:
Even when investors doubted their valuation of $7.5 million on Shark Tank, the founders held firm. They remained focused on their goals and continued to scale their business.
Their resilience led to significant milestones, including their acquisition by Uber and their platform supporting nearly 1 million trips.
Do you have what it takes to persevere? Stay focused on your vision and push through challenges. Success often lies just beyond the obstacle.
Takeaway:
Resilience is the foundation of every great business. Stick to your goals, even when the road gets tough. Like Car Next Door, determination can help you achieve extraordinary results.
