ATLANTA — Rented.com, founded in 2012 as VacationFutures and nurtured in the Triangle-based Startup Factory, has raised several rounds of capital and would be a North Carolina company if a state agency had not pushed them out.
Now the company, which connects home owners who want to rent their property with professional managers who can get them the best deals, is headquartered at Atlanta’s Advanced Technology Development Center. “Georgia welcomed us with open arms,” says CEO Andrew McConnell.
“We love these sites like Airbnb, but basically they deal with amateurs who do all the work themselves. Why not let professionals take the financial risk and do the work,” McConnell says. “So we created a wholesale marketplace that connects owners with the best managers who can get the best deal the most quickly.”
After several rounds of funding totaling more than $1 million, the company is up to 16 employees from four in February and is hiring. It could have been adding to the North Carolina economy.
Don’t create jobs or pay taxes in NC
Originally the company opened a North Carolina office, but the North Carolina Real Estate Commission told the company that to have an online marketplace like Airbnb’s, it would need a real estate brokerage license. “We went back to them and noted that Airbnb didn’t need a brokerage license. They said they had never heard of them. They had 15,000 to 20,000 properties listed in NC and at the time, we had five.”
The company and the officials went back and forth trying to find a solution, but it was no go. Finally, the company asked what it needed to do to operate without the brokerage license the way Airbnb does. “Don’t pay taxes or create jobs in the state,” was the answer, McConnell says.
He asked, “Is that really the result you want?”
Apparently so, because the agency did not relent and the company, which recently rebranded as rented because it found that 30 to 40 percent of its deals happened outside typical vacation destinations, moved to Atlanta after six months of wrangling with the state.
McConnell notes that at the ATDC, another company, Groundfloor.US is also “a refugee from North Carolina,” after experiencing similar problems with state government.
He cites a quote from the Economist magazine that a lot of time government is trying to apply 20th century solutions to 21st century problems. But when sharing economies provide better service, whether its Uber, Airbnb, or Taskrabbit, consumers get a taste of a better life and demand it. “All the deep pockets try to fight innovation,” McConnell says, “but typically, consumers win.”
It’s ironic, McConnell says, that the state talks about attracting talent and companies to North Carolina but then other arms of the state government scare them out. “North Carolina has a history of protecting its vested interests,” McConnell says. “I love North Carolina. I grew up in Greenville and would love to have a hefty presence in NC, but we couldn’t do it.”
Now people are starting to list assets beyond properties with the company such as boats. “They’re little used assets people can get an economic return on from others who just want a share of it. McConnell recalls the sharing economy mantra, “I don’t need a power drill, I just need a whole in the wall.”
With rented., he says, “They get the most income with the least amount of work. It’s a professionalizing layer of the sharing economy.”
For managers, it helps the best professionals grow their size and scale as rented brings them assets.
For consumers, instead of the Airbnb model, which has led to some disastrous rental stories, they’re now dealing with a bonded and insured web site. “They can relax because they’re dealing with a professional,” McConnell says.
The company is currently active on five continents and more than 50 U.S. markets.