Carsharing goes viral

Carsharing aims to ease traffic congestion.

Carsharing is on the rise, but it must be more scalable to have a real impact on easing traffic congestion and cutting carbon emissions, according to cleantech investor Sunil Paul. That’s the idea behind Spride Share, a San Francisco-based carsharing startup that came out of stealth in late April and is backed by Paul’s early-stage venture fund Spring Ventures, which has funded cleantech startups such as Nanosolar and algal fuel company Solazyme.

Unlike other car sharing companies, Spride Share, doesn’t actually own a fleet of cars. Instead, it allows individual vehicle owners to rent out their cars to Spride users. Therefore, the model automatically spreads to where the demand is, whether that’s a dense city neighborhood or a suburb, according to Paul, who is founder and CEO.

The company would install hardware that would operate the locks and track the vehicles. The service would be free to vehicle owners, and would charge users an hourly fee to cover overhead, including insurance. Spride would share profits with car owners, which would range between $2,000 and $7,200 per year, depending on the type of car and hours that it is shared, according to the company.

In North America, membership in car sharing services increased 117 percent from 2007 to 2009, with membership expected to reach 4.4 million by 2016, according to a 2010 report from Frost & Sullivan.

Spride’s success largely hinges on California lawmakers, who are considering a new law that would allow vehicle owners to participate in a personal vehicle-sharing program without having it affect their auto insurance policies. If that law passes, which Paul says could happen by the end of the summer, the company plans to launch a pilot program in six to nine months.