Photo - Carchaze Director
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Carchaze Director

Atif Khan

Pakistan
Market: Internet and IT, Services, Mobile applications
Stage of the project: Prototype or product is ready

Date of last change: 16.09.2021
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Idea

Carchaze is an online car sharing platform, connecting vehicle owners to travellers and locals seeking to drive nearby private vehicles and rent by the day, week or month. It allows drivers to rent from a wide range of available vehicles at an affordable price when they only need to drive and Vehicle owners to earn money while renting out their vehicles that would be otherwise depreciating.

Current Status

We have already built a real time functioning minimum viable product in form of mobile application and backend management dashboard, but to build a sustainable business around it, it is essentially important, to maintain a Restricted cash account for managing damage claims, Capitalise consistently on technology for further improvement of the platform, invest in fixed assets to setup a proper office, Invest in people to build an entrepreneurial team and capitalise consistently in marketing efforts to create traction and generate revenue.
To make our startup plan successful, Initially, we require 15 million rupees. We are offering 150,000 Preferred shares in equity backed by company assets, at the price of Rs.100 each in exchange for returns on investment/dividends @ of 30% annually, or 13.5% semi annually or 6.375% quarterly or 2% monthly.
Pakistan’s first online Person-to-person car sharing platform, entrepreneurial team, wide-open market size, insurance coverage for each trip, no cost of ownership associated to the vehicles and its maintenance, add up into our ability to scale and operate significantly efficient and that’s what makes CarChaze a great opportunity for your investment in its preferred shares having minimal risk backed by company’s assets.

Market

Pakistan Car rental market includes multinational players like Hertz, Avis, Europcar and more than 238 professional car rental agencies having large fleet of vehicles in urban areas and others informally with smaller fleet in sub urban areas providing car rental services by the day, week or month.
In 2020, the industry has generated more than Rs. 58 billion in revenue and is expected to show an annual growth rate (CAGR 2021-2025)of 14.12%, resulted in a projected market volume of Rs. 98 billion by 2025. Currently 3.1% people of the total population of Pakistan is renting vehicle and is expected to hit 5.0% by 2025. While it is expected that every potential user will spend Rs. 8135/- on average every year.

Driver definition:

Drivers or renters are the driving license holding individuals and business people need to rent and drive nearby private vehicles to fulfil their mid term to long term traveling needs. Their demographics, application to use vehicle and their behaviour are tabled as follows
Demographics
Gender: Men will more likely to Rent thanWomen
Age; 21- 38 (50%), 39 - 54 (40%), & 55+ (10%)
Education; At least Secondary school
Income; Earnings Rs. 20,000 up to Rs. 100,000 per month
Lifestyle; Lives in Urban and Sub Urban areas.
Applications
Leisure - (Tourism, wedding & social gatherings, visiting friends & Family, vacation and shopping)
Business (Business meetings, educational activities, Health care travelling),
Self Employment - Earn money while driving at Careem, Uber or as a taxi or tour guide.
Behaviour
Prefer to use smartphones for accessibility
Convenience of having a car only when it is needed and avoiding the maintenance responsibilities of a private car.
Low rate of Car ownership among millennials
Desire to drive and travel privately especially in groups and with families.
Rental coverage to limit their financial responsibility
Renting a nearby car as an alternative to support the decision to refrain from buying a car in the future or a substitute of a second or third car.
Vehicle owners feel strange without a car and prefer to rent nearby car or borrow from a friend or family member as a substitute while their own car is at workshop or sold out.

Host:

Host Definition
Hosts are car rentals or an individual sharing their household vehicle or starting to run a small fleet who wants to earn money while renting their vehicles to a trusted community of renters or drivers to fulfil their financial objectives. Hosts demographics, application of hosting and behaviour described as follows;
Demographics
Gender; Men will more likely host than women.
Age; 31 - 45 (40%) & 45 - 65 (60%)
Education; At least secondary school
Income; Retired individuals having savings, and or Earning Rs. 100,000 + per month
Lifestyle; Lives at Urban & Sub urban areas
Application
Earn passive rental income
Operate rental business and manage fleet
Offset the cost of vehicle ownership
Pay episodes for leased vehicles or loans
Behaviour
Prefer to use smartphones for accessibility.
Prefer to manage vehicles fleet through an online portal.
Convenience of sharing a car when it is idle
Desire to earn continuous passive rental income from their savings.
Passionate to own and manage vehicles.
Prefer to run a small business of their own.
Sharing a car to locals and travellers fully trusted and screened.

Problem or Opportunity

Renting a car to drive it by yourself is a miserable experience in Pakistan, because People don’t like to leave work and wandering rental offices just to find a perfect car, and then they hate the paperwork to ask friends to act as their guarantor, while halfway breakdowns, repairs and damages disputes make it even worse.
In result people spend millions buying cars which is then idle on average 65% of the time while they can rent it when they only need it or they can share it for the idle time to earn money.

Solution (product or service)

Carchaze offers mobile app based person-to-person car sharing marketplace, where drivers can choose from a wide range of available cars hosted by trusted community of neighbours and locals. Everyone has to be an approved member before they book or share a car to keep our marketplace safe for both vehicle owners and drivers. While 24/7 customer support and optional Protection plans will let them feel confident.
Utilising the underused vehicles while making renting & sharing easier and affordable, this convenient way will encourage our community to share cars with each other so they can save money buying less cars and lives better life.

Competitors

Direct competitors:
People mostly rent and drive vehicles from local car rental agencies, Multinational players like Hertz, Avis, Europcar and SIXT only just proved their existence in the market, Startups like rentcars247.com, royalcarrentals.pk and rentmycar.pk are emerging and known as web-based car rental marketplace.
Indirect competitors:
People mostly rides to travel using Public transport, local taxi services, ride-sharing service such as Careem and Uber, and a startup Roamer.pk.

Advantages or differentiators

1. Self driving, wide range of vehicles, and owners earn money by renting their car, make us unique.
2. No cost associated to the vehicle ownership and maintenance, will allows us to outperform competitors.
3.First time Membership verifications and resolving damage claims and disputes at the best.

Finance

Initially we are expecting high monthly growth rate of 60% for first year, and 17% for the subsequent years. We targeted to achieve 200 daily active trips within 2 years of our operations.
We are expecting to generate revenue of Rs. 3 million in first year,Rs. 40 million in 2nd year, 100 million in 3rd year, 180 million in 4th year and 260 million in 5th year.

Business model

Carchaze Director
Atif Khan
Farah Naz

Money will be spent on

Use of funds
Carchaze planned to utilise funds in the following composition;
No. Allocation Amount %age
1 Restricted Cash for Claims PKR 4.000.000 %27
2 Marketing PKR 4.000.000 %27
3 Fixed assets PKR 3.000.000 %20
4 Platform development PKR 2.000.000 %13
5 Recruiting & team building PKR 2.000.000 %13
Total Funding goal PKR 15.000.000 %100

Offer for investor

To make our startup plan successful, Initially, we require 15 million rupees. We are offering 150,000 Preferred shares in equity backed by company’s assets, at the price of Rs.100 each, Min Subscription Rs. 5 lac, in exchange for returns on investment/dividends @ of 30% annually, or 13.5% semi annually or 6.375% quarterly or 2% monthly. Beside that, We are also open to negotiate, participation in common shares of equity, depending on shareholder’s skillset, experience, time dedication and capital contribution.
Pakistan’s first online Person-to-person car sharing platform, innovative team, wide-open market size, insurance coverage for each trip, no cost of ownership associated to the vehicles and its maintenance, add up into our ability to scale and operate significantly efficient and that’s what makes CarChaze a great opportunity for your investment in its equity participation.

Team or Management

Risks

If any physical damages reported for a trip and either driver or host chose to resolve through Carchaze, Drivers will be charged for the out of pocket excess amount under the chosen protection plan, If total costs are less than driver’s out of pocket excess amount, we’ll refund the difference. Carchaze will reimburse hosts for a portion of eligible physical damage repair costs in excess of the deductible up to Rs. 5 lac, subject to terms and exclusions, and Insurance company would cover the rest for the lesser of the cost of repair up to the actual cash value of the vehicle.
The frequency of claims and costs are completely probabilistic but is manageable to reduce by implementing processing fees, appraisal costs and imposing penalties to either driver or host whoever is at fault, this way will encourage both parties to resolve independently and result to reduce the overall expense.
Claim expenses will be high initially due to its newness but as the customer ages, driver and hosts both will fully understand the protection plan and how it works, resulting to reduce the claim expenses.

Incubation/Acceleration programs accomplishment

we send our proposal to StartEngine.com venture capital which is based in US so they rejected our proposal due to some terms.
1 They are founded only for US startups.
2 Or majority of stakeholder of US.
3 Startup should be in US

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Photo 1 - Atif Khan
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Idea
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Market
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Finance
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Business model
Money will be spent on
Offer for investor
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