Why buy when you can rent what you need at a fraction of the cost?
That's the philosophy that led to the setting up of BorrowMe, an online marketplace that lists for rent all kinds of items people require in their daily lives — from power tools and ladders to kayaks and board games.
“The idea is simple. If you only need something for a short time, just borrow it,” says Nour Sabri, 43, who founded the company just over six months ago.
People in the UAE can borrow products for an agreed-upon price and return them when done, he says, adding that the rental agreement can be securely completed through the company’s platform.
Meanwhile, owners can make some extra cash by renting out their unused everyday items.
Mr Sabri launched the online platform in August last year. Since then, BorrowMe has listed more than 1,100 items and registered 12,000 site visits. Among the more unusual listings are a clown air dancer, a wood-fired pizza oven and a luxury yacht. The aim, Mr Sabri says, is to have at least 3,000 items and 30,000 site visits by the end of 2022.
BorrowMe has also onboarded 30 item rental businesses in the UAE, and the target is to get 100 such retailers to join the platform by the year-end, Mr Sabri says.
The company’s ultimate vision is to be the Amazon of lending and borrowing items in the Middle East, says the entrepreneur.
Mr Sabri's inspiration to launch BorrowMe was two global companies: the UK-based Fat Llama, a peer-to-peer rental platform, and the Netherlands' sharing platform Peerby.
“Both these start-ups have strong investor backing and are very well-funded. That gave me the confidence to replicate this model in the UAE.”
Marketplaces for rentals are loosely based on the idea of collaborative consumption. It offers people the traditional benefits of ownership without paying large sums of money for the items. The concept is gaining traction as users become more aware of the impact of wasteful consumption on the environment.
The sharing economy globally is growing at 30 per cent year-on-year, according to PwC, and is expected to reach $335 billion by 2025, from $15bn in 2013.
The GCC sharing economy was valued at $10.7bn in 2016, with the UAE commanding the largest share at $5.57bn, as per Strategy& estimates.
More than 10 per cent of consumers in the UAE have already tried renting a product in the past year, driven primarily by affordability and the non-requirement of long-term commitment, says Sandeep Ganediwalla, managing partner of Redseer Middle East, an Indian research company.
“Increasing sustainability is also becoming important in consumer decision-making,” he points out.
This adoption can “more than double in the coming two to three years, if issues around trust, authenticity, hygiene and high-quality customer experience are built”, says Mr Ganediwalla.
But such marketplaces face several challenges to grow beyond niche communities and geographies. The average value of a transaction is often low, as is the frequency from demand-side renters, business analysts say.
And unlike purchase-based platforms, owners who supply the goods need to co-ordinate logistics both ways, which can lead to friction.
“The rental sector for products also needs to address issues around hygiene, depending on the category they are operating in, to unlock the growth,” adds Mr Ganediwalla.
BorrowMe is accessible on the web and on mobile phones. Owners have to upload a photo of the item they want to rent out — along with a description and price. Borrowers can schedule a rental for as long as they want and then need to return the item in the same condition at the end of the period.
Both parties agree on a convenient time and place for the handover. Built-in secure messaging allows owners to communicate with borrowers at ease, according to the company.
Almost anything you own can be rented out, or permanently sold if you prefer, whether it be a camera that’s been collecting dust or a bike currently locked up in storage, the company says.
“It’s easy and, quite frankly, it’s fun,” Mr Sabri says.
As a next step, he plans to tap hotels and Airbnb management companies with a dedicated page on the company’s website to attract tourists.
“Tourists can simply borrow many of the items they need when travelling, avoiding the trouble of carrying them and — more importantly — buying them,” he adds.
BorrowMe has already signed a preliminary agreement with Houst, a UK-based Airbnb management company, which has about 250 properties in Dubai.
An Iraqi by birth, Mr Sabri grew up in New Zealand and has been living in the UAE since 2008. He has an MBA degree from the London Business School and has worked with global firms including IBM, Bain & Company, EY, PwC and HP, across several countries.
He previously co-founded another start-up in New Zealand in 2006 — called MetalAndSteel.com — a B2B platform that specialises in trading metal and steel products and services.
Mr Sabri initially funded BorrowMe with about $150,000 of his own money, before raising $50,000 from an angel investor. The money was used to buy the BorrowMe domain, create the branding, design and build the website and support business development, the founder says. He also contracted a search engine optimisation expert to improve BorrowMe’s online ranking.
“I am now seeking $500,000 in additional funds in the next 12 months. I will use these funds on technology development, marketing campaigns and operational expansion,” Mr Sabri says.
The start-up currently operates in the UAE and eventually plans to expand across the GCC and Egypt. “I would like to start in Saudi Arabia next, because it’s a much larger country and has a progressive vision for business expansion,” Mr Sabri says.
To fund BorrowMe’s ambitious expansion plan, Mr Sabri plans to raise another $3 million in the next two to five years.
Asked if he plans to eventually list the company, Mr Sabri says: “Absolutely. After we achieve success with our business model and gain momentum, we plan to list BorrowMe in the stock market.”
Currently, BorrowMe isn’t charging any fees or commissions for transactions on its platform. But it intends to start charging a 20 per cent commission on all transactions in about a year’s time. “I plan to start monetising the business in about a year,” he says.
Besides charging a commission on each transaction, Mr Sabri plans to start offering a delivery service for items as well as product insurance to diversify his revenue streams.
“Having companies advertise on our site will be another means of generating revenue.”
Plans are also under way to collaborate with global e-commerce platform Shopify. “We will be developing BorrowMe plug-ins on Shopify. And we will charge a monthly subscription fee for accessing our website through Shopify,” Mr Sabri explains.
Q&A with Nour Sabri, founder and chief executive of BorrowMe
How did the pandemic affect your business?
People have seemed a bit reluctant to meet with others face to face, and BorrowMe’s business model is dependent on this sort of interaction. This situation has resulted in a slow start, but we anticipate a much higher volume once the pandemic is not a factor.
If you had a chance to do it all over again, what would you do differently?
Instead of putting so much money into technology development, we would have allocated more funds for marketing and business development. Also, even though hindsight is 20/20, it would have been better to have launched before the pandemic.
Where do you see the company in the next five years?
I see BorrowMe becoming the Amazon for item lending and borrowing in the