Lula: Peer-to-Peer Car Sharing
Undergraduate students Michael and Matthew Vega-Sanz ’19 are the founders of Lula.
What is Lula and who are its founders?
Lula is an online platform that allows college students to rent cars from each other. We see it as a way to give students all the benefits of owning a vehicle without all the fees associated with it, while providing students who own cars as a way make money without taking time from their studies.
Michael and I, twin brothers from Miami, Florida, are the founders. We’re first generation Americans, as our family migrated to Puerto Rico and then Miami while escaping communist Cuba. Surprisingly, even though we are from Miami, we grew up on a small farm in the heart of the city as our family’s business has been the breeding and boarding of Paso Fino horses for more then 30 years. We grew up working on the farm, as farm hands that would help saddle the horses at the equestrian academy, and working with my mom who is a Therapeutic Horseback Riding Instructor for children with special needs.
We never planned on being entrepreneurs. We were basketball players who both suffered injuries prior to our first college basketball season our freshman year of college. At that point we switched our focus from basketball to academics with the plan of transferring to a top business school, like Babson, and making our way to Wall Street where we’d work at one of the large investment banks. We had the idea for Lula during our first year at Babson, and decided to pursue it as it was an opportunity we thought we’d never have again.
Where did the idea come from?
Back home, Michael and I have Papa John’s Pizza at least once a week, as it’s our obsession. When we got to Babson, we quickly realized that PJP did not deliver, most places close after 10pm, and if you don’t have a car but need food delivered on a budget, Dominos is your main option. After about three weeks in a row of Dominos, we got sick of it and decided to go on the hunt for a Papa John’s store that would accept a bribe to deliver beyond their delivery limits. Unfortunately, none would so we decided to Uber there. After seeing the Uber estimate, we realized it made no sense to take a $30 Uber to pick up an $8 pizza. We decided to order Dominos again and when it arrived, I walked outside to grab the pizza and saw the parking lot outside Forest Hall packed to capacity. I thought, “Wouldn’t it be cool to rent a car and go pick up the pizza?” I walked back inside and mentioned the idea to my friends, and realized I wasn’t the only one with this issue. We then interviewed more than 300 students from around the country, and realized we were on to something.
What makes your business unique?
What makes us really unique in the industry is that we are the only peer-to-peer (P2P) platform that insures 18 year old drivers. When compared to Turo and GetAround, two industry leaders in P2P car sharing, there are a bunch of differentiators besides just the age limit. Turo doesn’t allow for hourly rentals, has a cut off limit of 21, and has very expensive additional fees for drivers under the age of 25. GetAround allows for hourly rentals, like Lula, but has a price increase of 25% of the rental price for drivers under the age of 25, takes 40% commission fee (we take 25%) and costs about $600 to add the vehicle to their platform while we charge nothing.
With Zipcar, we differ in a lot of ways, mainly being that we are P2P while they actually own their cars. We’re also completely free to join, have no membership fees, and because Zipcar has to pay for their vehicles, they are typically limited to how many cars are on the campus so their supply rarely meets the demand. Looking at Babson as an example, there are 2000+ students, and four Zipcars…the supply cannot meet the demand so even though you are paying for the service there’s no guarantee you will have access to a car. With Lula, you only pay for the time you are in control of the vehicle, and have access to a much larger selection of vehicles. Although we won’t be starting off with all the cars we have available, we currently have access to more than 30 vehicles (a number that will continue to grow once we begin marketing) as students with cars have been incredible about putting their vehicles on the platform.
How do you handle liability/insurance?
Every rental includes insurance. When the car is being driven by the owner, their insurance policy is in place, but when the car is being driven through Lula, our insurance policy takes place. Whenever there is an incident, we ask the users to fill out an incident report form, and the claims process works just like if you were running it through your own personal policy…except you’re notifying Lula and our insurance company as opposed to yours. Our policies include a variety of coverages, most notably physical damage coverage, so if anything happens car owners can be confident their car will be covered.
What are your goals for the future?
People see us as a car sharing company for college students, but we see ourselves as so much more. We’re developing a piece of technology that will allow us to be the only company that makes 100% of vehicles accessible via smartphone. We see Lula’s future as a shared mobility company that changes the way we share all things with a key. We see Lula eventually sharing boats, scooters, planes, motorcycles and more while eventually allowing people to hail rides, car pool, and get around in a variety of other ways besides just borrowing someone’s car.
How did Babson help you in making Lula become a reality?
Babson’s Summer Venture Program was absolutely incredible. We were given access to mentors, housing, expanded our networks in ways I would have never imagined, and more. The Blank Center has such an abundance of resources that really acts as a catalyst in helping you take off in an inexpensive way. With our advisors, we essentially had access to seasoned startup veterans who could help us strategize our launch without being charged for consulting, or working with lawyers who wouldn’t charge us for non disclosure agreements or bits of wisdom that only are obtained through experience. Also, just having the title of “Babson student” opens so many doors as so many people immediately respect you for being part of this community that they’re so willing to help. Babson helps in so many ways that a response the length of an encyclopedia would be needed to really say how much it actually helps.
Anything else you’d like to add?
Something that really gets overlooked is Lula’s mission to make a difference. Global Warming is obviously a huge issue we face, and the main contributor to that is automobiles. Certain studies show that for every car added to a car sharing platform, 10 cars are taken off the road and that the average passenger vehicle releases 4.7 tons of carbon dioxide a year. When we heard those numbers, we realized that Lula can have a huge sustainable impact, and it just excited us even more because yes, helping students make or save money is great, but the fact that we can do that while helping make the world a cleaner place is just something that really excites us and we love to share with people.