Key Takeaways
- GeerGarage, founded by a Microsoft product manager, is building an outdoor equipment-sharing marketplace.
- The Seattle startup is gearing up to scale beyond its Western Washington roots, with plans to roll out its lend-to-own program and raise venture capital.
- The outdoor-focused market is crowded and some startups have shut down or pivoted.
Adam Wise dedicates much of his free time to backpacking, camping and biking around the Pacific Northwest and California. But like other outdoor enthusiasts, he realized his stockpile of tents and other recreational equipment spends most days collecting dust in storage.
This revelation inspired GeerGarage, a peer-to-peer marketplace for outdoor-focused camping and recreation equipment. The platform matches renters with lenders who have gear like tents, bikes, and stand-up paddleboards.
The bootstrapped startup is gearing up to scale beyond Western Washington. The company is in the process of pitching investors and accelerators. It’s also rolling out a new lend-to-own program, where approved lenders can get free outdoor gear.
GeerGarage is among a bevy of companies embracing the so-called “circular economy,” or the business model of sharing or leasing products rather than selling new ones. It’s part of the company’s broader mission to make outdoor activities cheaper and more accessible, Wise told GeekWire.
The growth plans come as the camping and outdoor recreation market is climbing. Revenue volume is expected to reach more than $120 billion by 2027, according to market research.
For nearly four years, Wise has tinkered with GeerGarage’s model, tweaking the product and user experience based on customer feedback. He also works as a senior product manager at Microsoft Azure, with a plan to work on the startup full-time in the “very near future.”
GeerGarage works by connecting renters with nearby lenders through the platform. The company is unlike Airbnb because it does the matching for users, similar to Uber. If a user is planning a weekend camping trip for two people, for instance, the startup might connect the renter with a lender offering a suitable tent for those specific dates.
Wise said the startup’s matching tool is built on the insight that people do not care about the brand, color, or make of the gear they rent. He said the company’s main focus instead is helping renters find the gear needed to have the outdoor experience they want. The idea is for the platform to be as flexible as possible.
The company makes its money by taking 40% from the lenders’ earnings, in addition to a 20% up-charge from the renters. For $100 of gear, the lender pockets $60, while the renter pays $120 before tax, Wise said. Lenders might make a “couple hundred dollars” per month renting gear on the platform, he said.
The startup recently launched its lend-to-own (LTO) program. The goal is to bolster supply and help users access outdoor gear, which can otherwise be expensive, Wise said. Here’s how the LTO program works:
- GeerGarage buys gear for eligible lenders who will then make it available on the platform.
- When LTO users loan the equipment, GeerGarage takes a portion of their rental fees. Lenders must return 80% of their earnings for each transaction.
- The startup takes a cut from lenders until they cover 150% of the manufacturer’s suggested retail price for the received gear. If a tent costs $250, GeerGarage will recoup $375 in rental proceeds, for example.
GeerGarage’s LTO program is similar to Loftium’s host-to-own, a tool that helps home-buyers with their down payment in exchange for a share of proceeds from hosting an Airbnb.
The startup will face competition from major retailers such as REI and Walmart, both of which offer recreational equipment rentals. There’s also startups like Quipto — pitched as an “Airbnb for outdoor gear” — which raised pre-seed funding and is rolling out in Miami. Arrive Outdoors, an online camping gear rental site, raised $4.75 million in 2020. And Seattle-based GearHouse gives users unlimited access to outdoor equipment rentals for a $105 monthly subscription.
Outdoor-focused newsletter Here & There in 2021 highlighted the “failed promise of an ‘Airbnb for outdoor gear.'” The article points to startups that shut down in the market including GetOutfitted, Stokeshare, and GearCommons.
The author suggests these companies fell in two categories: the “Amazon version” and the peer-to-peer model. In the “Amazon version,” startups handled distribution but had high overhead costs for storage and shipping. With peer-to-peer models, companies had low operating costs but struggled due to insufficient renter demand.
Michael Brown, founder of GearCommons, wrote in a post-mortem blog post that slow demand was the reason the company closed. He wrote, “people who rent gear typically only do so once or twice a year… In the 2 1/2 years we were in business, we only had a handful of repeat customers. That’s a problem if you’re trying to make money and keep your business alive.”
GeerGarage does not have shipping, storage, and other overhead costs, Wise said. The company is focused on balancing both sides of the marketplace equation, he said. This includes expanding the gear supply through the LTO program, as well as increasing demand through local market outreach and other marketing initiatives, Wise added.
“We’ve been spending a lot of our time focusing on getting the recipe right, from both the product perspective and the go-to-market as well,” he said. “Once we’ve got that recipe, the plan is to roll this out and scale up — ideally in every city throughout the U.S.”
Editor’s note: This story was updated to reflect the accurate revenue split breakdown.
