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posted on April 5th, 2017

PIVOTING POINTERS FROM THE TRENCHES

This is an excerpt from a longer article published on Medium by Turo CEO Andre Haddad, where he reflects on how and why he and the team decided to make a significant business pivot just over five years ago. Read the full Medium post here.


Late last year, my friend Shripriya Mahesh interviewed me about my experience as a founder and startup CEO for Omidyar Network’s podcast, Founder’s Corner. While there are myriad considerations for budding entrepreneurs to entertain when building their businesses, one of the most daunting challenges that founders often face is how and when to pivot their businesses, meaning a shift in strategy that has essential and substantial effects on the business model.

Pivoting a business isn’t just risky — it can be gut-wrenchingly difficult. You have an established mental model of what your business does and where it’s going, and challenging those established models can be excruciating. But it can also invigorate and be essential to the survival of your business.

Just over five years ago, really right after I signed on as Turo (then RelayRides) CEO, we not only launched nationally, but also were coming out on the other side of making a significant business pivot. A pivot so significant it could have derailed the team — and the business — if not thoughtfully managed.

So Shri’s question effectively was, why? And how?

An early vision

When Turo was founded, the premise of the business model was to connect people who need cars with people who had cars but didn’t use them all the time, and to intermediate that transaction via hardware technology (e.g. remote unlocking technology).

Harken back to a snowy night in Cambridge, Massachusetts in 2009, when RelayRides founder (and Turo Board of Directors member) Shelby Clark was stranded and in need of a car. Zipcar was in its heyday, and it was emerging as a genius solution to car ownership. Observing the cars lining the streets of that snow-blanketed street, he had an epiphany — all these cars could be Zipcars.

And thus the RelayRides model was born. It was so simple, anyone could be in Shelby’s situation — needing a car when traditional options weren’t readily available — so it seemed such an elegant solution to establish a peer-to-peer Zipcar. Such a model would:

  1. Remove the capital expenses by crowd-sourcing the fleet
  2. Deliver on the Zipcar promise of “wheels when you want them” by creating a network of rentable, remotely unlockable hourly car rentals
  3. Create tremendous economic opportunities for car owners to see a return on their investments.

No muss, no fuss, just frictionless access to transportation for the carless, and easy passive income for car owners.

The small-but-mighty RelayRides team, circa 2012

Executing on that vision, car owners would install hardware in their cars that would remotely unlock the vehicle for the renter, who would then be billed by the hour. We postulated that going all-in on hardware would make the experience as hassle-free as possible for both host and guest. But something just didn’t feel quite right…

Andre is the Turo CEO and a true car enthusiast. After many years in the consumer web space, he combines his passion for cars, technology, and the environment each day at Turo as he works to put the world’s one billion cars to better use.