COTTONWOOD HEIGHTS — Just a year in existence, Utah's homegrown entry into the shared economy arena, Neighbor, is making waves and building fans with a system that connects people who have stuff to store with the people who have space to spare.
But the new company, launched by a trio of BYU grads, is thinking deeper than just being a high-tech go-between. Neighbor co-founders say they're not only beating their traditional mini-storage competitors on price — by half — they're also using unique tools like machine learning and augmented reality to become the most convenient, safe and flexible storage solution there is.
And along the way, they're passing 85 percent of their earnings along to hosts.
When tech companies began leveraging the idea of the new shared economy a decade or so ago, many predicted it would take the world by storm and fundamentally change how customers acquire everything from a hand tool to a hotel room.
But, it turns out the predictions missed the mark. The tidal wave of the new shared economy never really materialized, business failures far outnumbered successes, and just a handful of insightful stalwarts rose to prominence.
The handful that identified staid, old business models and redefined them, leveraging innovation that elevated ease-of-use, service quality and cost savings, have become near household names.
Uber. Lyft. Airbnb.
Neighbor co-founder and CEO Joseph Woodbury thinks his company, even though it's barely past its one-year anniversary, may have found an edge over the better known titans of the sharing business world.
"We definitely have advantages over some of the other established sharing economy businesses," Woodbury said. "If you think about it, there's nothing easier than making money from a space you have available in your garage, basement or side yard. Uber and Lyft makes you come to work and drive and even Airbnb hosts have to leave their homes or have clean up between guests."
Neighbor has found success in highlighting these advantages to a growing customer base in Utah and, thanks to a $2.5 million round of seed funding announced Wednesday and led by local venture capital firms Peak Ventures and Pelion Ventures, the company is poised to break into new territories.
In a statement, Pelion partner Chad Packard said the company has all the tell-tales of a business venture headed for success.
"When we saw what Neighbor was doing, we were blown away by the potential," Packard said. "The concept is simple and straightforward, the market potential is incredibly high, and the team is whip-smart. We knew really quickly that we wanted to work with them."
Being part of a growing, and collegial, Utah tech scene has been a boon to the startup from day one. Woodbury said he's constantly surprised, and thankful, for how accessible and ready to help leaders of other, more established Beehive State tech firms have been.
"We've literally been able to sit down with people from Adobe, Jeremy Andrus from Traeger Grills and Aaron Skonnard from Pluralsight, to name a few, who have offered invaluable mentorship and counsel," Woodbury said. "And one thing I've heard strongly from everyone, and I think it's part of the fabric of Utah business, is making doing right by your customer the goal that drives you forward."
American Fork resident Josh Robbins said he tried to rent space in an unused garage on his own before getting connected with Neighbor and, for him, the experience has been entirely positive.
"I put word out through Facebook and spreading the word with friends and family, but it just didn't come together," Robbins said. "My sister-in-law forwarded me a link to Neighbor, and things were happening in a matter of days."
Robbins ended up finding student storers who needed temporary space for their belongings while away for the summer. Not only has he been able to earn an additional $270 a month from his storage rentals, he said, he has made some new friends along the way.
"The way the Neighbor platform works, it connects you with people close by," Robbins said. "Once they linked me up to with people looking for storage, I've gotten to know them pretty well. It's been great."
Neighbor co-founder and Chief Marketing Officer Preston Alder said the company is testing out a new tool called "Store with a Friend" that helps connect storers and storees through social media channels. The idea, Alder said, is building on links the two parties already have, an approach that comes with a built-in trust and familiarity factor and ends up being, well, pretty neighborly.
"We want you to feel like you just moved into the neighborhood," Alder said.
The company is also experimenting with a machine learning function that helps storage renters optimize their pricing to help keep spaces "one hundred percent occupied one hundred percent of the time," and is developing a mobile app that will include augmented reality tools to enable space renters and storers to both see and virtually "pack" spaces to help make the best matches.
Woodbury said the company has been able to adopt best practices in use by other share economy companies and has combined some of most effective policies, like identity verification and optional background checks, to help ensure that both sides of every transaction are comfortable with their arrangements.
And, he believes the company is on track to become as ubiquitous in the realm of personal storage as some others that have scored big on transport and accommodations. Woodbury said the company's mission statement is one they apply internally with as much enthusiasm and committment as they extol it externally.
"I love our brand culture," Woodbury said. "We're working on being good neighbors to each other within our company, too. No one is in charge, we're a neighborhood. We feel like everyone has a role but no one's role is more important than anyone else's."