The basic idea behind peer-to-peer rentals is brilliant in its simplicity: make money letting other people use your stuff when you’re not. After all, most cars sit parked 95 percent of the time. And if you have houseguests two weeks a year, that spare bedroom (if you’re wealthy enough to have one, that is) is idle almost as often. Why not rent it out and make some cash?
In 2012, Spinlister brought the side hustle to the bike industry. But the service frequently struggled, mostly because it launched just after bike-share programs started to boom in the U.S. and simple supply and demand wasn’t there. The logistics of pickup and drop-off are cumbersome. And it turns out it’s a lot harder to make a pile of cash renting a bike by the day than it is an apartment. In the end, there just wasn’t enough business, and Spinlister shut down a year ago.
But now it’s back, with a new owner and a new plan. The owner: Mark Gustafson, who founded Story Bikes, an e-bike company (the companies are separate). Gustafson personally bought a majority interest in Spinlister in the fall, while previous owner Marcelo Loureiro retains a minority stake. Gustafson thinks there’s still a future for Spinlister, just one that’s different than the founders envisioned, with less emphasis on peer-to-peer and more on shops and other businesses.
Spinlister previously tried to involve shops in the platform in 2017, when it started Spinlister Pro, an automated system built to handle every part of the rental process except handing over the bike and getting it back. Participating shops got a listing on the Pro site and could make use of Spinlister’s own online rental software and in-store kiosks. But not enough shops signed up. What will be different this time?
For starters, Spinlister is dropping its Pro fees. It charges a 17.5 percent commission on private listings but will only charge shops 10 percent. The company will also offer a faster, easier-to-use version of its online and in-store rental software, Gustafson says. And Spinlister plans on becoming a kind of market maker, matching bike shops, especially mobile shops, with hotels, college campuses, and businesses that want the amenity of bike rentals or bike share without the management hassle. In that scenario, the shop owns and maintains the fleet, the hotel or college provides the users, and Spinlister is the automated platform for the transactions. Hotels “don’t want to have to take a bellhop or concierge away from their job to fill out the rental paperwork and unlock the bike, and they definitely don’t want to have to worry about maintenance,” Gustafson says. He adds that there are a number of different ways to structure fees where three partners are involved.
“We’re still peer-to-peer, but our biggest focus is bike shops and mobile bike mechanics,” Gustafson says. Spinlister wants to blend traditional daily bike rentals with the kind of hourly rentals that the micromobility paradigm offers. “We want to give [communities] a middle ground between a Jump or Bird... and the old-school rentals,” he says.
That’s an ambitious plan, but it does conspicuously depart from the service’s origins. While Spinlister will retain peer-to-peer rentals, they’re pretty clearly not the emphasis now. Honestly, that may be for the best.
One of the things I never understood about Spinlister was why, as a cyclist, I’d want to rent the bikes I could find on the service instead of using another approach. Particularly with the rise of bike share and scooter share, if I just want transportation in a downtown area, those systems are a lot easier for me to use—and maybe cheaper, too. And if I want a nice road bike for a spin on vacation, a traditional bike-shop rental offers me an easier way to find a bike in my size, not to mention a more reliably maintained, higher-quality ride, and I don’t have to worry about whether the lister will forget or ghost me for pickup and drop-off.
Gustafson knows all that, which is why he’s de-emphasizing peer-to-peer as the basis of Spinlister’s business model but not abandoning person-to-person transactions altogether. “The problem for straight peer-to-peer is that someone has to take time out of their day to make this transaction happen, for not a lot of money,” he says. This limits sign-up. Some of the technical solutions Gustafson envisions for business partners may also work for peer-to-peer listers. For instance, the company is experimenting with keyless smart locks to simplify pickup and drop-off. But it’s still in beta and, while dockless bike and scooter companies seem to have the tech figured out, I’ll believe it for a bike lock when I see it work.
Gustafson also says that Spinlister has a large network of users it never really capitalized on and new ways of targeting them. Count me as slightly skeptical that Spinlister’s native network is that large. After all, the business shut down after it was unable to raise new funding, suggesting that the volume just wasn’t there. And until it quietly restarted in January, the site had been something of a zombie for eight months and didn’t allow transactions; even the listers and renters who did use the service may have shut down their accounts or simply left them idle and never returned. Gustafson didn’t directly address that in our conversation, but he did say that the company is pursuing a number of partnerships that will broaden its network, including with the advocacy group League of American Bicyclists and CycleLifeHQ, a kind of online hub for cycling vacations.
The last big concern for peer-to-peer listings is liability. Spinlister’s rental agreement includes an indemnity clause and a damage-and-theft-insurance provision (up to $10,000 per bike) for the lister. “We haven’t ever had [an injury lawsuit] happen in our history,” Gustafson says. But there’s no real protection for the renter, and no insurance coverage on third-party property damage or injury liability for the lister. That leaves a bike owner vulnerable, because no indemnity clause is bulletproof, and homeowners- and renters-insurance policies typically don’t cover liability for commercial use (for example, they’ll cover you if you loan a bike to a friend now and then but not if you rent it out for money). The liability insurance offered by Uber and Lyft, for instance, isn’t perfect, it but offers up to $1 million in primary liability coverage when a driver has a fare. Spinlister offers only the indemnity clause; if a court rules it’s invalid, the lister is on the hook.
Bike shops, by contrast, have professional mechanics and their own liability insurance. That’s why I think Spinlister’s new shop-first approach is its only real option to survive. The peer-to-peer market simply hasn’t been there because the logistics aren’t great for renters and the profits aren’t there for listers.
If Spinlister can provide shops an easy plug-and-play option for online booking, as well as a solid marketing plan to drive business to a shop, then it provides a viable service to shops. If it can enlist mobile shop franchises like Beeline or Velofix, which can do rental drop-off and pickup, and partner with tourism businesses like hotels to provide rental fleets and maintenance, then Spinlister offers something of value to listers and renters that doesn’t already exist. The combination of those factors could mean the difference between the company’s past struggles and a modestly profitable future.
That’s no small task. It’s one Spinlister has tried before and been unable to make work. But given the vastly different ways that shops currently approach rental reservations online, there’s definitely a market opportunity. Spinlister just has to convince everyone that it’s the solution.
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