Charles Polanco, CEO of Donald.
Similar to crowdfunding for creative projects on Kickstarter.com, Donald Inc. features a new crowdfunding platform where people can pledge money for a car they want to rent in the future.
Essentially, interested users pool together money to finance the purchase of a car they’d be able to rent as a group for a determined period of time. Donald Inc. would manage the reservations process.
“[In our model, since renters are financing cars, in essence replacing banks or investors, our renters pay rates that are up to 60% less than they would pay at car rental companies like Hertz and Enterprise,” says Charles Polanco, owner of Donald Inc. “We are able to offer lower rates because we pass along the savings from not having to pay back banks or investors to our renters.”
Since renters are financing the vehicle, the rental rate can include unlimited miles, auto insurance and taxes. Additionally, Donald users won’t have to pay common car rental fees such as airport concession fees, customer facility fees or vehicle licensing fees, according to Polanco.
When a vehicle is offered on the Donald platform, interested renters — within a certain geographical area — pledge to buy rental days. Once 100% of the rental days are sold (365 days), new renters are blocked from submitting new pledges to the campaign.
The car can be used for rental 365 days within a 24-month period, says Polanco. The rental days are sold to the renters by dividing the MSRP of the vehicle by 365 rental days. Delivered for free to the selected airport location, renters will return the vehicle to the same airport location.
“A ‘kickstarter’ website for rental cars can offer a Toyota Corolla with an MSRP of $16,900 to renters for $46 per day by offering 365 days to future renters,” says Polanco.
Working with local dealerships, Donald only offers renters new vehicles. According to Polanco, the cars are sold after 12 months of use to cover costs, including maintenance.
The time of a crowdfunding campaign varies; it could last a few days to 30 days. But if enough money isn’t raised, the campaign is removed from the platform and all pledges are reimbursed, according to Polanco.
Donald manages the rental car fleet, which includes various brands such as Chevrolet, Ford, Honda, Nissan, Toyota, Infiniti and Mercedes-Benz.
To get involved in a campaign, users need to sign up for a free Donald account, select a car and then submit a pledge to the campaign to finance that car. Once the campaign has been completed, the renter pays his or her pledge and can reserve the car, says Polanco.
Currently located in New York and New Jersey, Donald is looking to expand to other states in the near future.
For more information, visit www.hidonald.com.
By Amy Winter