Don't miss Found Live on 2/17 at 10am PT / 1pm ET with our first guest Thor Fridriksson. RSVP at ttps://tcrn.ch/3ox8iS1. When serial founder turned venture capitalist Sunil Paul decided to step back into startups, it was only after trying to give the idea behind his fintech company Spring Free EV away for over a decade. The idea is simple, bring down the initial cost of electric vehicles by charging owners a fee per mile. And after the wildfires in California lead to what he called the "orange sky day" he knew he had to figure out a way to do more to address the climate crisis by making EVs more accessible to the people who drive the most in the US. He joins Darrell and Jordan to talk about the end of the world, recruiting as a climate-focused fintech, fundraising, and of course Canada came up a few times too.
RSVP for Found Live. Don’t miss your chance to listen to episodes found early and interact with Darrell, Jordan, and their guests. On February 17th at 10am PT/ 1pm ET, Thor Fridriksson will be talking about his experience launching two viral games and founding his new company Rocky Road.
When serial founder turned venture capitalist Sunil Paul decided to step back into startups, it was only after trying to give the idea behind his fintech company Spring Free EV away for over a decade. The idea is simple, bring down the initial cost of electric vehicles by charging owners a fee per mile. And after the wildfires in California lead to what he called the "orange sky day" he knew he had to figure out a way to do more to address the climate crisis by making EVs more accessible to the people who drive the most in the US. He joins Darrell and Jordan to talk about the end of the world, recruiting as a climate-focused fintech, fundraising, and of course Canada came up a few times too.
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Darrell Etherington 0:01
Hi and welcome to found I'm your host, Darrell Etherington found, of course, is where you hear the stories behind the startups. And it is the absolute number one best podcast in the TechCrunch. Universe, the period and who you heard just there, of course, it's the Tesla of my Prius.
Jordan Crook 0:17
Yeah. Jordan crook. I like that. That's
Darrell Etherington 0:19
sexy. Like you're a newer, better, or I was like a precursor.
Jordan Crook 0:23
Yeah, you started it, though. You were a pioneer in the space. Yeah, I'm
Darrell Etherington 0:28
just a hybrid sheet
Jordan Crook 0:29
newcomer who picked up the mantle.
Darrell Etherington 0:31
I was effective at what I needed to do, but not really a looker.
Jordan Crook 0:37
Why are we talking about
Darrell Etherington 0:39
that? Oh, no, we should talk about this episode of the podcast. Our guest this week is Sunil Paul, who is the co founder and CEO of Springfree. Evie, which is not an Eevee company per se. Even though Evie is in the name. It's actually a fin tech company that makes EVs more affordable for actual drivers. So basically, they lower the cost using an innovation they came up with called the mileage purchase agreement. Actually, Sunil came up with that, and many, many startups ago, yeah. But he realized this was an innovation that could be used to help spur adoption of EVs and get specifically small fleets on board with purchasing them in volume. So very cool. It's one of those things where you're like, Okay, I get it like, this is one of those ideas that is a nuts and bolts behind the scenes idea, but it's one of the things that is really actually going to spur adoption of vehicles, whereas things like Plaid mode, or whatever Elon is coming up with might not attract a huge amount of people to go buy the cars, because that's a very expensive model and no one can afford. Right? That's right. It was a great conversation with Sunil, we went far and wide on EVs and climate and everything in between. So let's go ahead and let him explain what Springfree Eevee is and how he came to create it.
Hi, Sunil, thanks for joining us.
Sunil Paul 2:10
Hey, great to be here.
Darrell Etherington 2:12
All right. So we like to start this off by getting a little bit of an explainer of your company. So we're here to hear about spring fee free. I mean, we're here to hear about spring free EV, which I just learned is a bit of a tongue twister. But definitely a very cool concept behind the company, you're probably better explaining than I would be. So why don't you take it away and give us a kind of TLDR on what spring freebie is all about? Sure.
Sunil Paul 2:40
Well, thanks for having me. I'm Sunil Paul. I'm CEO of Springfree. Evie, and I get a lot of practice saying it. So I usually don't trip on it. It is a FinTech company set up and designed to have impact on climate by making electric vehicles more affordable and accessible. We do it through a really simple idea, which is we charge a fee per mile and use that revenue to make the upfront costs more affordable. As you probably know, the upfront cost of the electric vehicle is the biggest problem with adoption. Yeah. And so we fixed that problem.
Darrell Etherington 3:14
Nice. Yeah. And I've noticed, the focus is on you know, high mileage drivers. So I imagine you end up tying up with a lot of folks who do gig economy work or, you know, Uber Eats or Uber or Lyft, or that kind of thing. Is that fair to say?
Sunil Paul 3:29
Yeah, so there are two reasons for that. So we are focused on the sharing economy, and car sharing in particular, and many of those car sharing hosts also work with Uber Lyft. And delivery drivers. The reason for it is that if you have an electric vehicle, eventually the total cost of that vehicle will be lower than a gas powered vehicle. But only if you drive it. You just stick in the garage is never going to be cheap. That's actually
Darrell Etherington 3:57
the reason that I still am I see wrecked my car I use, I don't know, like once a month, I use it enough to keep the battery going. But not much more than that. And if I had an electric I would feel like an idiot. And also it would just be the battery would just be leeching or whatever they call it like slow drain right? Especially right hold today winters. I take that point very personally.
Sunil Paul 4:17
So that's, that's one of the big reasons. The other big reason is, they're the ones that use sedans. And if you think about what are available today, it's all sedan, electric vehicles, SUVs and pickup trucks are not yet available. Now, I happen to know a lot about car sharing and ride sharing. I've been involved in car sharing from the beginning, I incubated, get around, I started the first ride sharing company. So you know, this is a comfort zone of understanding that world. And it's really just the beginning. Like, we have ambitions to be able to solve this problem across the US around the world. They gotta start somewhere. You know, you can't boil the trillion dollar ocean. You got to start with a niche.
Darrell Etherington 4:56
Yeah, for sure. So you mentioned a bit about your background, like was that kind of your age? to this business when you were working in car sharing, or did you see this opportunity and then figure like, oh, that this is perfect, someone should build this business and it should be me, or how did you kind of get into it?
Sunil Paul 5:11
Believe it or not, I've been thinking about this since at least 2009. I was looking for some other patterns that I have. And I looked up one, I happen to see this one I kind of forgot, I thought, a provisional patent on a variation of this idea back in 2009. It's been kicking around in my head for a very long time, it didn't really start taking life until the wildfires started happening here in California. And I looked at my own, what can I do more right to have an impact on climate and realize that, you know, using my strengths, I'm an entrepreneur, I'm an operator, I'm fundamentally an optimist. And I thought, oh, you know, that MPA idea, that mileage purchase agreement idea, and just the crux of what we do that could have big impact. And, you know, I went into the bath and figured out Yeah, like, we could have big impact with this idea, bigger than what solar did, you know, with Sunrise and Solar City and Mosaic, right, those companies fundamentally change the nature of solar installs through FinTech innovations. And we think we can do the same thing with electric vehicles. Yeah,
Darrell Etherington 6:12
I mean, it's an interesting approach to take the the FinTech angle, we actually had on another founder Kintaro from German run me the company name, Persephone for Stephanie. Right. And so they do accounting for carbon credits, essentially, right? The idea being companies will want some kind of verifiable standard that they can show to regulators and peers, but his quote was, you know, capitalism made or created the climate change problem. And capitalism is the means by which we need to fix it or worse those effects, right. But it seems like your approach is very much in that spirit. Is that fair to say? Like when you look at that, and you think, how can I contribute? Like, I suppose a lot of people would say like, Well, why don't you go nonprofit route or something like that, right, especially if you've been successful as far you have significant means, but you're obviously taking the approach of like a for profit businesses, the way to turn this around. So talk a little bit about more about that motivation, I
Sunil Paul 7:04
guess, it really comes down to this business and every other business that will end up solving our climate problems, is going to need a lot of capital. And if you look at where is the capital available, there is money in the philanthropic sector. And there's also money in the government sector, but the vast bulk of money available, because in the philanthropic sector and the government sectors, that money is already allocated and reallocating it to something else is a challenge. reallocating something in the commercial sector is a function of risk and reward. So if you can develop a new method, or you know, better return for the same risk, or better, you know, whatever, get that ratio, right, money is going to flow in. And there's a tremendous amount of capital out there that wants to invest in sustainability and governance, ESG kinds of investments, there's already 3.6 $3.5 trillion, just in equities globally, interested in ESG investments. And you know, by the way, there's not that many opportunities to invest in something that can scale to hundreds of billions of dollars. So our goal is really to create a new asset class, like a new asset class, that can bridge the gap between all of this capital that would like to be able to have an impact. And the millions and millions of drivers around the world that want to have an electric vehicle, electric vehicles, fundamentally a better car. Yeah, the number one obstacle is it cost more upfront. And so if we can remove that obstacle, it's going to unleash a huge wave of innovation, and it can have an impact on climate. Allow me to talk more about that. But it's the reason why we're doing this company. You asked why not a nonprofit. That's one reason. But I will tell you that I think nonprofits definitely are an important role in all of this in instigating for having solutions to climate. And there may yet be a role here. I mean, especially you look at the way that the crypto world is set up. Often there's a nonprofit that is the center of it. Right? You know, we definitely continue to think about that as we grow up. But right now that's got something that's working product market fit, we're just like, just keep the pedal down.
Darrell Etherington 9:10
Yeah, for sure. Keep.
Jordan Crook 9:12
So like, what was the starting point, right, like you mentioned, the provisional patent 2009. And then the wildfires kind of like sparking something. Yeah, emotional or internal in you. But then like when you sit down and you're like, Okay, I'm gonna start this company based on this idea. What's step one, right, like, how do you identify step one, and where did you start?
Sunil Paul 9:32
It's interesting, because I did not start out thinking I was going to start a company. I started out thinking, I've been trying to give away this idea for 10 years. I've talked to people about it. I've shared it with big auto OEMs and I thought, it's actually on my birthday 2019 I remember I posted something on LinkedIn saying, hey, are there some entrepreneurs out there that be one helped me with a new idea? And so like Got some responses as you're running a contest to try to get other entrepreneurs excited about the mileage purchase agreement, and see if we get to product market fit with that effort, right? Basically, I got 22 teams from around the world all kind of focus on different aspects of product market fit. And yeah, should be should be rideshare. Should it be trucks? Should it be the US or India or, or the UK and that was fantastic experience. And what I learned out of it was okay, there are some possible paths to product market fit. And these companies are going to need capital to be able to scale. And so the original original idea was, well, let's go create a fund that can help these companies scale. As we looked at that idea. Two things happen. One, I'll do the math, like, and I'll tell you the the key moment for me, if you were in the Bay Area in in the fall of 2020, everybody remembers the orange sky day, it was just so bizarre. And, you know, we all sat around saying what the WTF and that moment along the other wildfires. I went and I did the math. I said, Okay, how many vehicles would it take to get to one giga ton of carbon dioxide reduction? By 2030. publish the results of this and, and I had been thinking about that result. I was like, Oh, right. Okay, well, could a financial innovation like this, could of FinTech innovation like this get to 100 million extra vehicles? And I concluded, yeah, yeah, we could do that. Okay, well, that's not a fun anymore. That is a, that's a company along the lines of Sunrun, or mosaic. And that's a whole different proposition. So it also is why we are focused on b2b Like, we don't offer a product that the consumer can use, we have a product that a small medium sized fleet can use, and they turn around and offer it to the consumer. So that way, is that kind of reflects the heritage of where the idea came from? So yeah, the story is not a ha moment. And by the way, I don't know how many of you interviewed a lot of people. It's never an aha moment. In like a little tiny thing. Maybe it isn't hindsight. Yeah. Maybe in hindsight, when
Darrell Etherington 12:20
you write your story, in retrospect, I think that happens a lot, right? Because it's like, yeah, it's better. It's better for an audience to consume it. But yeah, mostly it happens. But I
Sunil Paul 12:30
wouldn't say that warm sky day was transformative for so many people. Like it was. Yeah, it was just otherworldly. I would
Jordan Crook 12:37
you call it orange sky? Because this guy was orange.
Sunil Paul 12:39
Yeah. Like we woke up in the morning. And there was no sunrise. You know, in the morning is more reddish. And then the entire day, the sky was orange. There's no sunset. We never saw the sun. So I remember
Jordan Crook 12:52
like seeing it on the news and stuff. But we flew in to San Francisco for an event like two days after that. Yes, I remember being this is gonna sound a little weird, but like, I remember being kind of bummed that I missed it. Just because like, I mean, like, I don't want the world to end. But Daryl and I have talked about this a million times. Like, if it does, I want it to be like, pretty dramatic. You were hoping? Yeah, like, I want to witness the craziness of it. And that felt like one of those like surreal things that it's sad, but it's also like a once in a lifetime thing to see like what something that truly feels like the end of the world like another planet. Yeah, you're the
Sunil Paul 13:31
one on the beach watching the tidal wave come in.
Jordan Crook 13:35
Yeah. Mubi Deep Impact. I'm Taylor. Schilling. Good pull
Sunil Paul 13:44
it like Woody Harrelson with the volcano?
Jordan Crook 13:46
Totally, totally. Yeah. Radio, like let's go.
Darrell Etherington 13:53
But at least this like, like to your points and you're like this had an impact that it wouldn't have had otherwise. Right? Like, without that huge shared effect that everyone saw. It was like just such a dramatic thing. Like, you know, like so many other things that go on where we just kind of don't notice them, because they're happening all around us all the time. Right. But I feel like it unify people and it kind of like galvanize people into action. I've heard that from a number of people were like, that was like a turning point, especially Bay Area folks.
Sunil Paul 14:20
And it came on, like that was the third or fourth year of smoke from wildfires. It came on the epidemic pandemic, like it's just this feeling that the world is messed up, and what can we do? Right, and, you know, many of us, most of us, have some agency some ability to do something and whether it's joining a company that's making a difference or, or joining a nonprofit or starting one, we all can do something and I think we're all looking for something to do. Yeah, yeah, we don't want to be here helpless. Well, you know, the wave consumes us. We want to, you want to go out and destroy the asteroid.
Darrell Etherington 14:57
I don't think of that with like the great resignation that I don't I haven't seen talked about much, maybe it's too early to see the kind of impact but like, I feel like a lot of that is that effort, right? Where the people are like, well, you know, I'm inclined to go work for something, some company that is making a difference in some way or whatever, right. And so there's that dissatisfaction and then there's just not enough yet potential, I guess, hires or something, or maybe the skills matches aren't quite there in terms of what people are looking for. But like, I think that's a big part of at least from anecdotal evidence, right? Just talking about Yeah,
Jordan Crook 15:28
I'm like, the mission oriented thing is kind of weird to write because I think girls, right, anecdotally, at least, like it feels to me, like a lot of people that left their job. And just in general, the way that like younger people are looking for jobs is very, like more emotional and more like, you know, I want to stand for something good. If this is going to be eight hours of my day, every day, I want to feel good about the impact that it's having and like, who my leaders are, and what they stand for the principles and values that we have not just what my paycheck looks like. And I'm curious from you on being like a pretty mission oriented company in a space like climate and sustainability, where
Darrell Etherington 16:08
with a FinTech focus to right, like, that's cool, because then you attract and speak to an audience that maybe hasn't had the opportunity to go pursue this type of work before, right.
Jordan Crook 16:17
But it also feels maybe a little bit looted by this point, like not by you, but just in general like the, like, we're going green, right? Like, it's this kind of thing, where like, it's lost its trust. And even like the idea, even if it's not like sustainability, just the idea of like a mission oriented business is something that we've heard so much for so long. And it's like a buzzword,
Sunil Paul 16:40
I could go I could go so deep on this, let me let me try it, or the TLDR. Oh, do it. Okay, do whatever, whatever makes you happy. Go online, every we only have one life. I agree. And, like one of my big mantras is do not waste my time, do not waste your time, don't waste people's time, because we've only got one. And it's not worth wasting your time on useless things. So I have endeavored to try to create companies with positive externalities. In other words, this idea of externality is that not everything that a company does, is captured in the price. Traditionally, it's known as a negative externality. So for example, if you you're a utility, and you're making electricity, there's all kinds of positive things you're doing creating jobs and electricity and making life easier for people. And they're all these negative externalities, your pollution from the coal, natural gas, and whatever else, there are certain companies that can create all kinds of positive externalities more than the negative. And so a second company in particular was organized around that way as an anti spam company. You know, the idea was, can you align the profit motive and the mission, so that it's not like, Oh, we're utility, we're gonna clean up our act. It's more like, oh, the nature of what we do is fundamentally going to have a positive externality, we're not going to capture the value to society is not just in the price that we charge. There's all this extra stuff that gets generated, like a better climate. And so I've been thinking about this and focus on it for quite some time, you know, it's part of clean tech 1.0 was a lot of money in that one. And honestly, my efforts around car sharing and ride sharing, they were organized around the idea that efficiency in transportation would have a positive impact on climate and pollution. One of the important realizations that I had after sidecar and with all those wildfires, that I was wrong, efficiency ends up generating more demand for the product.
Darrell Etherington 18:43
There's the classic la roads example, right? Like you keep building the roads, and they keep putting cars on
Sunil Paul 18:49
La roads. Great example. So the notion that we got to shift over two electric vehicles is informed by the failure, even though I helped create 10s of billions, maybe hundreds of billions of dollars in value in the industries, it was not successful and having an impact on climate possible, it had a slightly negative impact, but it's also turning out to be a great place to start for electrifying. So, you know, there's a there's a chance at, at sort of redeeming the overall direction.
Darrell Etherington 19:17
Yeah, I mean, that you're not alone in that realization, obviously. Right. Like, I think that was an assumption a lot of people made, you know, with good faith and good intent going into that industry being like, look, we do this, we're gonna raise utilization, but inventory is gonna stay flat or go down. It's gonna be great for everybody, right? But it didn't end up being the way that it worked, which is fine. Like you try something you have you make a hypothesis, and then it goes the other way, but you're unique, at least in terms of people I've spoken to who saw that and then we're like, well, but we can take the different approach. Take that reality we've now made and then turned it into an externality positive net result right with this other key thing we really want to do because if you start with fleets and whatever that gets OEMs you to it right OEMs have want to build for fleets and volume first, and then the consumers will be pulled along with that. Because that's the other thing of electric cars. When you were talking about EVs, and you're talking about price. We're old enough German, we saw the rise of EVs were like you heard about them, and you're like, Oh, they're massively expensive. But don't worry. Over time, volume and scale will mean that initial cost comes down, and it hasn't. And that's the thing that still needs solving. So something like what you're doing solves,
Sunil Paul 20:27
it does come down. But here's the problem is it's not coming down fast enough. Right. So one of the interesting bits of analysis we've done is that actually, we didn't do the analysis, others have done this announce that figured out that in order to get to net zero by 2050, we need to have a lot of extra vehicles, 75 million extra vehicles by 2030. Why? Because these things have a long lifetime, right? You can't just be like, oh, cool, it's 2020 45, time to throw a bunch of cars out there. So we need to get to net zero by 2050, in order to hold warming to 1.5 degrees Celsius. So it avoids kind of like the catastrophic, you know, in the analogy was earlier tidal wave version of the climate change. So that's, that's the gap we're trying to solve for is that even with all of what government's doing today, and all the subsidies and all the infrastructure investments, and all the you can't drive with a gas powered car in London, like, even with all of that, we're still not going to get there, it's still, it's still a significant gap.
Darrell Etherington 21:27
Since you're found listener, I'm gonna bet you're also pretty interested in startups and technology. Great news, we're going to give you an offer for 25% off a subscription to TechCrunch plus, PC plus is our premium product. And when you get there, our deep dive interviews with some of the best startup founders and investors in the industry, you get surveys of different investors in different areas of expertise and geographies, you get market maps of opportunities in new and emerging industries. And you get deep dive look at some of the hottest startups out there, you can subscribe to TechCrunch plus at TechCrunch plus.com. That's probably the easiest way to get there. Or if you're already on TechCrunch, just follow the links for TechCrunch plus, and you'll get a prompt to subscribe. Once you're there, just enter the code, which is found the name of this podcast during checkout, and you'll get 25% off a one year TechCrunch Plus subscription.
Jordan Crook 22:16
Are you a super duper huge fan of found the podcast, we have big news for you. So we're gonna start doing live recordings where you can actually come hang out with us, we always do this podcast on video, but we're gonna show that video to the world. Yes, and it's gonna start on February 17. We're going to be doing it every other Thursday. Our sister podcast equity is also going to be doing that on their alternating Thursdays,
Darrell Etherington 22:43
all the podcasts from TechCrunch. Together well separate. But yeah,
Jordan Crook 22:47
the TechCrunch podcasts are coming to you live. So that means you'll get to listen to new episodes early. And I think probably the best part that I'm excited about is you're going to be able to join in on those conversations so you can log into hoppin, and you'll be able to chat your questions directly to us right within the episode and talk to our guests. And we'll be able to incorporate you know what you're thinking and what you're wondering about right into the episode itself. And those are all going down will starts on February 17. They all go down at 10am Pacific 1pm. Eastern, every other Thursday, and we're gonna have some stellar guests. In fact, our first guest for February 17 is going to be Thor Fredrickson, if you don't recognize that name, you should he founded Quiz Up, which was a massive game back in the day. And then he also founded a gaming studio called Tea Time. And he's working on his third thing now serial entrepreneur, and he's two for two on creating hyper viral casual mobile games. So lots to learn there.
Darrell Etherington 23:50
Maybe he'll just dish maybe he'll reveal during that episode, what his next huge game is, can't guarantee that asterisk asterisk.
Jordan Crook 24:00
Maybe he'll explain how he got to viral hits, and has yet to really bring them through on the successful business side of things. So you just find the link in the description if you want to register to come hang out with us.
Darrell Etherington 24:16
What about on the supply side? Because the other thing I hear people complain about a lot, especially at the very like right now with supply chain issues is I can't I want to buy a car with a battery in it. I can't find a car with a battery and and a lot to buy. Right. So how has that affected your business? And how are you kind of navigating that?
Sunil Paul 24:36
Well, the supply chain issues are definitely a short term problem. We do see that that will resolve itself just through all the investments that are happening. But the more interesting thing that's happened in the last there's plenty of supply promises being made by the automakers. In other words, they're saying we're going to deploy a lot of electric vehicles. A really interesting thing is happening though which is BMW is releasing a version of their a four series. And the CEO is quoted as saying it's in the Wall Street Journal on Saturday, that they will build that car with either a gas engine, or battery, depending on demand. So unlike the world Tesla, which is just all batteries, they're gonna, like crowdfunded, I would say the other way around. In other words, if they don't see adequate demand for batteries, they're gonna be like, well, we'll just gonna keep going with a gas. So we need to demonstrate massive demand for electric vehicles. And we're no more I'm certain that will not be just BMW taking that approach. Because, you know, when you're not a maker, you make a huge investment in a plant. And, you know, in fairness to them, the sort of whipsaw effect of Trump comes into power and says, No, we don't, we're not gonna do electric cars. And Biden comes in and says, Yes, we are. And
Darrell Etherington 25:54
like, it's, it's hard to build when you're like, because they build their platforms for like, a span of five years, or whatever, at least, right? They build their platform, and they're like, we're gonna build one platform, all our vehicles are gonna be based on it for at least a couple decades, or whatever, right? And it's a massive, massive investment, and then to have the rug pulled out from under you every four years is must be horrible.
Jordan Crook 26:16
Well, that part of it's probably not going away, unfortunately, right? Like, the pendulum swinging full speed, right now doesn't seem to be slowing in any way. That's a political
Sunil Paul 26:26
pendulum swing, our goal is to turn it into a non stop consumer wave.
Darrell Etherington 26:35
In some ways, it's a chicken and egg problem where you're like, Well, who goes first? Right, but like, if you get everybody behind the idea of like, we're all in on this, then it's not gonna matter what the government does. And it's a bit of a wag the dog situation anyway, because like, they dictate where the government decides to
Sunil Paul 26:51
write. Now, Evie, adoption is still heavily heavily a project of government incentives and programs. You know, like, for example, the way that the incentives that are put out there by the carmaker are used to balance their ability to sell polluting SUVs. And even with Tesla, because Tesla is selling those credits to other OEMs. So even if you're just a pure battery makers still don't get away from it. So we've got to shift that dynamic away from this thing that they're doing, you know, just because of CAFE standards in the US and other standards elsewhere. So that it's kind of in our collective control. I was going to mention, I was gonna go back to the great resignation, because I think there's another interesting dynamic there that relates to us, lots of people quitting their jobs to go create business, right. And I don't think most people will realize how many businesses have already been created around the sharing economy, in particular, the car sharing economy. So companies like Toro, which just you know, released the rest one to go public and get around in hyrecar. We've got a partnership with our car on Turo released there in there as one over something like 85,000 hosts. And I know from experience with car sharing, ride sharing, probably about 20% of them are running it as a real business. So in other words, you can make a living doing this and, and those are our customers, you know, those folks out there who are who figured out how they can have, you know, usually at least five to 10 cars out for rent, like you can make, you know that level you can make a living, and many of our customers are, you know, and then in the dozens of cars, a few of them passed 100 cars, like it's a real interesting business. Yeah,
Darrell Etherington 28:31
that's an interesting part of your speak to Taro fairly often. But like, I think that was like a part that people didn't really understand about the platform is they thought it was I mean, very similar in terms of trajectory to Airbnb, but they thought it was a thing where you just like, oh, somebody has a cool Mustang, and they're not driving and I'm gonna go rent it. But it's actually a platform for establishing small rental companies in effect, right, like competitors to the big hurts or whatever. But like little tiny individual owner operated things, it's that's where their real opportunity is. And they've explicitly launched it to some markets with that target in mind, right. And like, at first they were targeting the existing mom and pop shops that are open, but then they were creating their own. And it is you right, it's like it's a there's massive number of businesses that are just that it's a passive income business, in a lot of ways. I mean, there's some active involvement, but in the same way that somebody Shopify stores journalists, the part where I mentioned Shopify, Shopify,
Unknown Speaker 29:26
are they a sponsor? No, no, no, I just use the word
Jordan Crook 29:30
Darrell Etherington 29:33
but uh, you know, a lot of people associate that to like, once you've resigned, or you want to, like start control your own destiny, you find these opportunities where there are platforms, you can build little businesses, and you work on them and you invest in them, but they they're not necessarily tracked or visible to a lot of folks,
Sunil Paul 29:48
this great resignation may end up turning around. We've had a decline in entrepreneurship since the 70s. Despite all of you know, topics that you all write about. It's kind of surprising And it's possible, this pandemic will actually turn it around, because there's a lot of people deciding, oh, wow, I'm gonna make a living on my ecommerce site or as an Airbnb magnate, you know, like, also think about as a, as a tech entrepreneur, I think the story gets played out over and over again, which is we go out and we create these platforms that allow as little as one person to plug in and do something, whether that's, you know, eBay back in the old days, or more recently, Airbnb and Toro, and but also companies like mosaic, which is a solar finance company, they started out being able to handle small participation. And then people discover, oh, wow, I can make a living on this. I can make a real business on it. And then the volume of transactions ends up being driven by the people who are kind of professional. The same is true for ride sharing. Yeah, right. Like when you get into a rideshare, it used to be everybody was kind of a casual driver. Now you get into it, and most of the time, it's somebody who does it either part time or most time. And so the same dynamic plays out in all of these platforms, because once you can create that low cost infrastructure, yeah, that's capable of handling a lot of people that you can scale it up to take on incumbents that have a much higher
Darrell Etherington 31:10
cost of infrastructure. Yeah, I'm gonna this will be my last Shopify thing. I swear Jordan back, that that 70% That was one of Toby's favorite quotes as well, right, that entrepreneurship is actually on the decrease as their job to kind of turn around. And then also, they created Shopify Plus by accident, because for exactly the reasons you're talking about, right, like they were supporting small individual sellers. Some of those got to the scale where they were coming and saying, like, oh, can I'm gonna run my international retail business that does 100 million in revenue, like yearly on your platform? Can you support that? And they were like, I guess, I guess we can. And then they just added a plus to it and said, This is our product now, right? And gradually added enterprise figures, but it's the exact same thing you're describing for the E commerce Mark.
Sunil Paul 31:56
Yeah, same things happening with stripe, and just on and on, like, this is the same movie that's playing out in tech over and over again,
Darrell Etherington 32:03
I do, then I want to ask or transition into future focus stuff for spring pre V. Like, are you? Do you think about different kinds of financial products? Or do you think about the scaling customers? Are you seeing that already? How do you see the evolution of the business?
Sunil Paul 32:18
What a good question, we think a lot about what we do next, I can tell you that it's all organized based on our top priorities, or as a corporation, we consider our top priority to be climate impact, that's above, even having profit and all the rest. So our, when we think about new product opportunities, we think about that as kind of a guiding principle. So the number one thing we're to do is simply execute on what we what's in front of us, you know, when you've got great product market fit, you've got good market fit, don't screw around, just get that done. So that's like job one, two, and three. Now, in addition to that, we know that there are additional kind of, kind of sub supporting products that will, that will help us in that journey. So those are all coming, I'm not gonna pre announce them here. But you can imagine that you can imagine that there are things that would make our fleet managers more efficient, there are things that you know, our customers more efficient are things that would that would kind of expand the offering so that we could make it attractive to more more people. Like right now our offering is your car sharing host on Toro, or on hyrecar, you can get a handful of electric vehicles, you can get dozens of electric vehicles, and you're gonna pay a monthly fee on biology, but you're not gonna have to go through a credit check. You don't have to mortgage your house, you don't need five years of operating history, but it fits within a particular band of vehicles. So you can see us expanding the band of vehicles. But beyond that, the next segment that we see beyond this kind of car sharing and gig economy is being able to offer something for high mileage drivers, if you're a high mileage driver today, which by the way, there's about 10% of us drivers, there's almost 300 million cars in the US 280 So 10%, like roughly 30 million drivers that put on an average of 30,000 miles a year. Now, these drivers skew SUV and pickup truck. So you know there aren't good SUVs and pickup trucks that are EVs, the world's kind of ready to go create an Eevee product for them quite yet, but it's about to happen. So we want to create an offering that if you are a high mileage driver, you could enter into this mileage purchase agreement and lower the price of your car or your truck or SUV. The reason why it's so compelling for a high mileage driver. Is that your options today you don't really want to get into a lease.
Darrell Etherington 34:47
No, it's normally a penalizes you for being a manager. Yeah.
Sunil Paul 34:51
So you know, we like opportunities where the competition is terrible. Yeah. So that's kind of our next segment after This car sharing
Darrell Etherington 35:01
economy. Yeah, that makes a ton of sense because yeah, that's I mean, that's the reason why at least cuz I go in and I'm like, I'm gonna use this many kilometers, Canada, but they they're like they're like, Okay, first of all, you shouldn't even own a car at it. And then second of all, this is great. We love you. You're our favorite customer, right? But yeah, by the
Sunil Paul 35:25
way, can you buy? Can you buy cars on Shopify? In Canada?
Darrell Etherington 35:28
Ah, that's a good literally, man, I gotta I gotta learn that because like a drop,
Sunil Paul 35:35
because you could just I can't believe you didn't prepare for this interview, like,
Darrell Etherington 35:41
in other ways, but not
Jordan Crook 35:43
DeRose favorite things? All one which is buying something. Shopify and Canada.
Darrell Etherington 35:50
You work with Tesla and Nissan, for instance, I pronounced those wrong, Tesla and Nissan. But do you work with a lot of OEMs? And is it something where if you especially with this new product category, right, we see Chevy, I think is electrifying, a Silverado Ford, obviously f150. And they'll probably go down the line of their trucks to the more affordable ones. Are you in their early with those conversations talking to them? Do you have their ear on that kind of stuff?
Sunil Paul 36:17
Yeah, we're in conversations with a bunch of OEMs, including new OEMs that are bringing electric vehicles to the US. We also just announced, you know, a lot of the cars we buy our used cars to put them into this program. So we announced a partnership with Cox, automotive Cox automotive may not be a household name. But a lot of the huge companies that they own are like Kelley Blue Book and auto trader. And they also process it like the world's largest processor of cars that need like 6 million a year. So we've teamed up with them to acquire the cars to inspect them and condition them, getting them ready to deploy a bunch of other logistical things that basically give us scale to be able to deploy across the country. So that that helps us a lot with a used segment, or the pre owned segment. And then for new cars, we're going to end conversations with a number of OEMs, about getting access to more cars. But yeah, the Nissan, we've got a number of them showing up this month. And next we're excited about continuing to expand it got a new ARIA coming out this year, the leaf has actually kind of got a bad start, because it was kind of a compliance card. And in other words, a car that was built just so that they could comply with the rules and not all that well designed. But it's actually pretty good car, especially the the latest version.
Darrell Etherington 37:31
Yeah, they iterated well on that. Yeah. Like it gives them the ability to say like, oh, well, we were one of the first right like that as the other side benefit of a leaf has been around for so long. But mileage on the original leaf was such that like it was not really a useful automobile. The new one is like a perfect fleet card. Imagine for in city use, basically. Right? Like it's not
Sunil Paul 37:50
we know it's very popular in some European cities, this specifically the electric. And so, yeah, we're seeing good traction here.
Darrell Etherington 37:57
Well, I think we're just about out of time. But like I really I didn't want to end by saying or asking your like a serial founder, obviously, you found a lot of companies been very successful at it with that, combined with the climate topic, like is the VC conversation now at this point, just like, okay, like, come on, it's me, look what I'm doing. Give me some money, or is it still tricky and difficult there? How's that go for you? Well,
Sunil Paul 38:21
I think it does make it way easier, both because of knowledge and relationships and track record. I guess that's three things, isn't it. And it's kind of like, the more successful you are the more ambitious right you get. And frankly, the ambition here is driven by a big social mission. So like we need to get really big and to be successful. We know that it won't be just us, like we can't go deploy 75 million vehicles ourselves, we know that others will do it. But in order to get other people to do it, we need to be very successful. I mean, the analogy I use is if Elon Musk went around, trying to convince car companies to build electric cars 20 years ago, instead of starting a car company and having it be he's no maybe no longer worth trillion but worth a lot of money more than existing companies. Now there's a bunch of conversations in boardrooms like you need to be more like Tesla. That only happened because Tesla ended up being so successful. Right? So we need to be so successful that there are boardroom conversations in the incumbent sources of financing for the automotive world, let's say how do you be more like spring for Evie, because look what they're doing, look at the market cap, etc. So that requires a lot of engagement. Not only interestingly, not just in the VC world, but also in the world of asset finance. So something that some of your listeners may not be as familiar with, but in the climate world, it's really important to understand that this is pretty capital intensive but you don't want to use the venture money to finance All of that capital intensity, you want to use asset finance. And so we've already been successful in raising and using asset financing. And we're out talking on on both fronts on both the sort of equity and the asset Finance Fund.
Darrell Etherington 40:13
Yeah, that is a good point. I'm sure people don't realize, but I know other companies that are in the same boat where you don't realize like they are, you know, fundraising is a slog, right. And a lot of our listeners know, fundraising is a slog. But imagine you're also at the same time going and talking to banks and asset lenders. And you're, you got to pitch them to in a very different way, but you're doing some stretching on both sides. Right.
Sunil Paul 40:35
Now, luckily, for the climate world, there's one of the very big differences between now and clean tech 1.0 is there's so much more capital that is that understands it. And many of them have been through clean tech 1.0 and now have the lessons of both what to watch out for and what can work. And so it's so much easier because of that the learnings from last time around.
Darrell Etherington 41:00
Alright, well, that is gonna do us for time, but thanks very much for joining us. Sunil is great talking to you. Well, you pretty far ranging conversation, but awesome. illuminating. I learned a lot. I don't know.
Jordan Crook 41:10
Thanks, Neil. It's fun talking to you.
Sunil Paul 41:12
Well, I enjoyed doing it. Thank you for having me on.
Darrell Etherington 41:21
All right. That was our conversation with Sunil, we sprung free up. Jordan, what did you think about our chat with Sunil?
Jordan Crook 41:31
You know, I'm always interested in the startups that innovate on the things that are normally kind of set in stone, right, like business model innovations, right, which is essentially what this is like, we call it a FinTech company. It's not I mean, it's kind of a fin tech company. But like, ultimately, it's just buy these cars a different way. It reminds me of ClassPass, right, where ClassPass was like, what if you did classes, but on a subscription we take for granted? I think sometimes those kinds of innovations are breakthroughs. And so I'm always interested in people already buy V's, we want people to buy more EVs and buy a faster, let's just change away while right. Yeah, they don't have to change anything about the the technology itself. So I'm always interested in that, because I think it's a different way to approach a startup that people like really gets forgotten, right? Or ignored more, because there's always like a playbook, right? Oh, this is how cars are sold. Or this is how gym memberships are sold, or this is how we'll just follow that. But we'll make a different gym membership, or we'll make a different car, right? You look at the other side. And it can be just as fruitful if
Darrell Etherington 42:32
not more, it's this area where like, essentially, the companies are looking at a bunch of ingredients that kind of already exists, and then putting the ingredients together in a way that is novel to achieve the thing they wanted to achieve, right? Like this is one where it is technology. But it's like a technology that often gets overlooked, where it's like a financial technology, right, like a debt investment. And like debt, capital is a technology. It's just like so fundamental that we kind of don't really think about it in that way. But it's like somebody had to come up with the idea of like, oh, this organization that has money can lend it to this other one. And that's not just like something that exists in nature. It's a technology, right? Well, it exists in Settlers of Catan, which is again, not nature, technology. For sheep, yeah, but I did think you know, it's cool, because it's one of those things where it's like, you can tell he thinks about this stuff a lot. And is like spending a ton of time thinking about like, look, this is what I know. And here's what I want to achieve. And he brought up repeatedly that the company has their top line goal is actually not profitability or revenue, it is to proliferate the adoption of EVs, right? Which is one of those things where you're like, well, can that really? I mean, can it be, I guess I can have your pre public company, you know, there be corpse exist and things like that, for that you can actually define that as part of your mission while still being like, you know, legally satisfying stakeholders and everything. But like pre public, yeah, you can say that. And it sounded like he cares about that a lot. Right. And but yeah,
Jordan Crook 44:03
it sounded like he meant it. Yeah. Which is something we've talked about a lot, right. Like, the climate of climate tech. Right is like this thing that has had a counterweight to it, which is like, Oh, do is it really credible? Is this really what you mean? Or is it just like greenwashing or, you know, mission driven, is thrown around all the time. And, you know, it does feel very genuine coming from
Darrell Etherington 44:27
me. Yeah. And he brought up the point that green tech now is in many ways, the easier area to work. And when you're talking to investors, because of all the lessons learned from the first green tech bubble, so in a lot of ways that was bad for climate tech in general, because when you had the first actually, I mean, I think he brought it up. I think there's been probably two rounds of that now like hype and deflation, but like, there was a lot going on and a lot of stuff was being thrown at the wall and there was very little in the way of accounting for what was real and what was not right. And I think people got burned and learned their lessons out of and are coming into this with a bit more rigor. I mean, who knows five years from now? Maybe I'll eat my words, but we'll still be doing this podcast of course. So yes, like check in and be like, well,
Jordan Crook 45:10
our lives never changed. Yeah.
Darrell Etherington 45:14
Or well, I'll be killed by the title. Yeah.
Jordan Crook 45:18
The bones on the beach.
Darrell Etherington 45:21
I like it that way. I mean it's Alliterative. And it's also like pretty cheerful the way that you just put it. So yeah.
Jordan Crook 45:27
It makes you imagine like a pina colada. bones on the
Darrell Etherington 45:32
beach. You're funny skeleton. Yeah, cool beach chat and stuff. Yeah, that's where
Jordan Crook 45:36
we're going. So nice beachy music.
Darrell Etherington 45:40
You know, he brought up that he lived through this. And he brought up also like, the most interesting thing for me for this podcast was that he was cognizant of the impact that his previous focus had like car sharing. He's been involved in multiple car sharing startups. And he brought up that thing that like, is increasingly being demonstrated by the data that car sharing didn't alleviate traffic in cities. It Yeah, exacerbated it significantly. Right. Right. It's not the intent. At least it was not the way that was sold. I think depending on who you're talking about. Some people might have been aware that that was gonna be the case or might not have been, it seemed like for Sunil. It was genuinely like, Oh, this is an unintended consequence and unintended externality as he put it, that he did not like, right. So it's cool to hear about somebody realizing that they've done that and then setting about to correct it. Whereas when he talks about negative externalities and tech, a lot of the times we're talking about, like people realizing they exist, and then ignoring it or going off to do something else. Zuckerberg is the prime example. But like, Oh, I did Facebook, right? Easy. One, society is ruined. I think I'm gonna go do a meta verse now. Right? Like, I'll just leave that leave that burning pile of garbage behind and go to a metaphor
Jordan Crook 46:51
with few like, with little evidence to show that any lessons were learned, right? Like, we're not, it's not like we're gonna see Metaverse be like, no ads, we're never gonna take your data. And, you know, we're policing the way that conversations are happening. And public discourse takes place. He's like, let's just do it with headsets on.
Darrell Etherington 47:09
Yeah, exactly. Same thing all over again, for you know, in the other the other place. Yeah, well, yeah. So Neil had that genuine moment of self reflection, and like a realization that he wanted to do something better. And he applied the levers he knows how to use and the way to maximize that impact. Right. So I think that's very cool.
Jordan Crook 47:29
I think so too. I also thought it was interesting that he, like did not want to build this for like, 10 years, right? And was like, trying to hand off like a good idea to an entrepreneur. I'm curious if like, that's a thing that happens a lot. And
Darrell Etherington 47:42
I think among VCs it is, I hear about it a lot. And it's like, you know, they're all sitting there was saying like someone please build this, and I'll invest in it. Right? And then eventually they get tired of
Jordan Crook 47:51
it. But from the other side, wouldn't you be like, No, I don't want to build your idea. Right? Like there. There's like the entrepreneur in residence, right? That kind of like does that sometimes are like the studio model, right? Where those people are like, Yeah, I just want to like build the thing. Yeah. Don't necessarily care about what it is.
Darrell Etherington 48:09
Yeah, from the entrepreneurship community. It's, they're rarely free radicals just floating around looking for.
Jordan Crook 48:15
Yeah, got anything I could build like they're normally like, I'm super passionate about this one idea I had six years ago and I just like couldn't stop thinking about it. Well, that's
Darrell Etherington 48:23
why I think with with people like Sunil who are operators that are like lifelong operators, and then go into the venture space, they usually end up ping pong back out into the operator space again, because they get one of those ideas that catches root. They're just like somebody's got to build this and eventually they realize it's got to be them. Right?
Jordan Crook 48:42
Well, anyways was good conversation. You should read and review this podcast.
Darrell Etherington 48:48
Yeah, but be excited about it. Unlike Jordan, just like get in there and get really excited about your review. Leave a scintillating one, maybe put cap lock Caps Lock capslock put caps lock on.
Jordan Crook 48:59
Caps. Book look caps locks on. Anyway, good day folks.
Darrell Etherington 49:12
Founders hosted by myself, TechCrunch news editor Dale Etherington and TechCrunch Managing Editor Jordan crook. We are produced by shad Kulkarni and edited produced by Maggie Stamets TechCrunch his audio products are managed by Henry pick of it. You can find us on Apple podcasts, Spotify, or wherever get your podcast and on Twitter at twitter.com/found. You can also email us at firstname.lastname@example.org and you can call us at 510-936-1618 and leave us a voicemail. Also, we'd love if you could spare a few minutes to fill out our listener survey at bit.li/found listener survey. Thanks for listening and we'll be back next week. Spring forever. They bring free Eve free V
Jordan Crook 49:53
Transcribed by https://otter.ai