The company trying to change how you think about owning a car

LOTS OF PEOPLE hum and haw when it comes to taking credit for their work. Not so with Colm Brady.

During a chat about who has been the main driver behind GoCar, the Malahide native is pretty unequivocal. He views himself as the man responsible for making car-sharing a viable option in Ireland.

“I think that the guys would credit me with the idea of bringing it on board, it was my baby from the start,” he tells Fora. “Anything new or different is something that I want to get involved in.”

Car sharing is certainly different from accountancy, which is where Brady started out. After studying at Griffith College, he worked for a consultancy firm for several year where he focused on installing computer systems.

“That and the accountancy knowledge are the foundations for all the decisions that I make,” he says. “It was all a really good grounding for me, I saw how a company should and shouldn’t be run.”

A chance meeting led him into the motor industry. Brady is a rugby enthusiast and at a pre-match lunch for his local club at Clontarf he bumped into a stranger, Colm Menton, who was a past president of the club.

The pair got chatting – and then several months later Brady got a call.

“His company, Malone Car Rental, needed a computer system and I was brought in to look at what had been done in that area,” he says.

The job with Menton turned into a role with Europcar Ireland, the local arm of one of Europe’s largest car-leasing companies, and then GoCar – where he now has the small task of trying to change how Irish consumers think about vehicle ownership.

What do you do and how long have you done it for?

GoCar is a vehicle-sharing firm. It rents customers cars and vans for short periods of time, typically several hours rather than a few days as with a traditional car rental.

In theory it is a ‘pay as you use’ model aimed at people who don’t need to drive regularly. Well-known businessman Colm Menton is behind both the GoCar and Europcar brands.

Menton, who had also been involved with companies such as Cambridge Investments, which briefly owned Xtra-Vision, and food ingredients distributor RedBrook, purchased Europcar in 2009 for his Malone Car Rental group, which had been struggling to grow without acquisitions.

After taking on the brand, the Dublin-based company grew quickly and is now Ireland’s third-largest car rental business with 250 staff and a fleet of more than 6,500 vehicles.

During this time, the 42-year-old Brady became the company’s director of business development and the firm began to explore the possibility of moving into car-sharing in an effort to get ahead of the competition.

GoCar managing director Colm Brady

“We would consider ourselves an innovative company and we looked at Europe and the US where car sharing was becoming a more viable option,” Brady said. “The software and hardware was getting cheaper and people’s understanding of what was on offer was getting better.

The company considered launching its own pilot project here until it stumbled across a small firm called GoCar, set up in 2009, that was already doing exactly what Europcar wanted to move into.

The larger company bought the smaller one and in the summer of 2012 relaunched the GoCar brand with the aim of bringing car-sharing to a mass Irish user base.

The firm has seen slow but steady growth since then. Its fleet grew from 57 to over 100 in 2015 and is expected to nearly double again by the end of the year. It has about 5,000 members signed up to its service.

What are your costs and how do you make money?

All of GoCar’s revenue comes from customers paying to use its vehicles, which include both cars and vans.

The firm operates on a subscription basis. To sign up, customers log onto the company’s website where they fill out some basic information such as where they live and details of their driver’s license.

They then get a membership card, which can be used to book any one of the company’s cars in 140 locations in Dublin and Cork, with the vast majority of those being based in the capital.

Most of GoCar's operations are in Dublin

Once a car is booked, you go to wherever it is located, get in and drive – and once you are finished, you leave it back in one of the company’s allocated spots.

There is a charge both for how long you have the vehicle and for every kilometre you drive.

For example, for its city range of cars, GoCar charges €2.49 per hour for the first eight hours, with an additional charge of 49c per km. All costs such as fuel and maintenance are handled by GoCar. There is also a once-off fee of €50 to join and a monthly fee of €5.

For the business, fleet maintenance and upgrading vehicles are where most of the money goes.

”Depreciation is the biggest cost, most of the vehicles are very new,” Brady says.

“Most of them are less than a year old; we have several from 2014 but we are replacing them now.”

Car parking in the city is also a major factor, with spaces often costing €1,200 for the year in Dublin. However, this has been mitigated in the past year or so with the introduction of legislation that allows local authorities to allocate spaces for car-sharing as part of an effort to push people away from individual car ownership.

Dublin City Council was the first to enact the legislation, and towards the end of 2015 it gave GoCar access to some prime spaces in some of the busiest parts of Dublin. Staff costs are small, with the firm running a tight five-man operation.

Overall, GoCar is loss-making. It is just under €650,000 in the red overall and lost slightly over €100,000 last year, however Brady says that this is part of building up the company’s brand.

“GoCar isn’t making money, but we are investing in the future. We need to expand to get to a certain size and the owners are willing to commit and invest where they see the market going,” Brady says.

What is your market?

Although the customer base is a reasonably broad mix, Brady says that the firm gets particularly strong interest from overseas.

“A lot of international people have signed up, they come to Ireland and they want to find a similar service as to what they can get abroad,” he says.

“We would also have a lot of Google, Facebook and LinkedIn customers, services like car sharing in tech areas make sense, and we are also starting to put vehicles in business-focused areas such as near banks.”

GoCar is more popular among tech workers

With the bulk of its fleet in Dublin and the remainder in Cork, it has several hundred thousand prospective customers at the very least.

So far, the company thinks that it has tapped into just a fraction of its potential users. When it initially relaunched in the middle of 2012, GoCar predicted it would have a fleet of 200 by the end of 2013, a feat that will likely now take until the end of this year to achieve.

Brady admits that it has taken longer to grow the business than expected, but he adds that the new parking space-allocation rules could make a big difference.

“We are planning to relaunch in Cork soon. We want to get back on the map there, we needed to get things right and now we have a lot of things right,” he says.

He adds that there is “no reason” not to launch in other cities such as Galway or Waterford, although he added “we would need the atmosphere to be right, we would need the council thinking the right way”.

“(Our business model) is based on high population density, good public transport and good retail and businesses – and somewhere like Cork has that, although I have no doubt that we will expand to other cities.”

What is the competition?

GoCar is one of the few companies that doesn’t have a direct competitor doing the same thing in Ireland, however like every firm there are others going after similar customers.

Brady fingers the twin evils of car ownership and a lack of awareness as GoCar’s two primary obstacles.

“Advertising is very expensive so we’ve used social media so far. We’ve done well there, but if people aren’t on social media then they won’t see our message,” Brady says.

Car ownership is the real rival. Similarly to houses, the Irish like owning their own cars.

The most recent, comprehensive car ownership figures show that 1.36 million households had at least one car in 2011, an increase of 186,000 from 2006.

We also know that whatever about ownership, new cars are zooming out of parking lots across the country. Almost 125,000 cars were sold in 2015, the first time they cracked the 100,000 mark since 2008.

New car sales were up last year

Brady says that GoCar isn’t trying to stem the tide of new car sales; rather it’s trying to scoop up a few of the drops.

“There is no comparison to the number of people signing up for GoCar and the number of new cars and that won’t change soon. But I’m not concerned, it shows the size of the opportunity,” he says. “If there are 150,000 people changing cars and we can get 1% to stop or delay that would be fantastic, we’re not looking for something like 10%.”

What is your vision for the company?

Brady is confident that GoCar can kick on now that it has a bit of momentum.

“If we continued to double in size for the next five years we would have 1,000 vehicles and maybe 30,000 members,” he says. “We would like to double in size every year to 18 months, that would be the ideal situation.”

He also expects another car-sharing operator to enter the market at some point and challenge GoCar, but he doesn’t seem overly worried at the prospect.

“We will see another company at some stage – it will mean we weren’t wrong, but we will maintain a strong presence and stay as market leader,” he says.

“As more places get built around the city, people won’t want or be able to own vehicles and that is where car-sharing services like GoCar will come in.”

That is the crux of it really, and it is something that Brady is convinced of; that, in time, people will want to move away from owning their own vehicle and will want the flexibility that car-sharing can offer instead.

“There is a shift happening, whether it is movies with Netflix or music,” he says.

“Ireland was so hung up on ideas of ownership and the recession taught us that it might not be the right thing to do, people realised ownership is expensive and may not be worth it. What we are trying to do is offer an alternative.”

This article is part of our weekly series examining the nuts and bolts of businesses. If you would like to see your company featured please email news@fora.ie.