Most good businesses are born by solving problems. This particular problem began in a sewer pipeline.
Brothers Jabbok and Willy Schlacks were working in the construction industry when they realized how difficult it was to rent construction equipment. With their own drill miles away, the Schlacks were in need of a drill — and fast.
“[Jabbok] was about 15 feet underground in the middle of a sewer pipeline, just poop everywhere, trying to get through this manhole,” Willy says. The brothers rented the equipment they needed to get out of the messy situation, and when they went to return the drill, they discovered the rental rate for three days, $300, was the going rate for a new drill.
“We knew that every contractor in the world has one of those tools,” Willy says. “There was no reason why it should have cost us that much money to use it for three days.” High rental prices result in many contractors buying equipment they may only use a handful of times, which leads to oversupply — and underutilization — of construction equipment.
But there was no way to connect contractors with excess unused construction equipment with contractors in need of that equipment. It was then that Jabbok and Willy decided to solve the problem themselves, and EquipmentShare was born. EquipmentShare is an online platform where contractors can lend and rent equipment from other contractors for less than rental companies charge.
EquipmentShare installs devices — essentially GPS trackers — on all rental equipment so contractors can see who is using their equipment, what it’s being used for and where it’s being used. The company also helps saves its rental customers money on insurance. Willy says rental companies charge an additional 12 to 20 percent for protection plans, which cover damage that is already covered under most contractors’ insurance policies.
“What they don’t realize is that most of their insurance plans already cover [rented equipment],” Willy says. “And if not, their plan is very close.”
EquipmentShare will work with contractors at no extra cost to make sure they have a plan that covers rented equipment so they can save that 12 to 20 percent each time they rent a piece.
“If they spend $200,000 on rented equipment,” Willy says, “that could cost them an extra $20,000 for something they’re usually already paying for. EquipmentShare also conducts required safety checks on all its contractors’ rental equipment.
“It’s this ecosystem that we’re creating” Willy continues. “Some contractors lend, rent, buy and sell all within EquipmentShare’s platform.”
“We’re helping solve a fundamental problem in the industry, and that is really cool,” Jabbok says. “We’re actually meeting a need and helping make jobsites safer and better.”
Essentially, EquipmentShare is more than a rental services. It’s a free online management system for construction equipment, funded by a 20 percent cut of the rental price for its users’ equipment.
Basically, it’s the Airbnb of the construction world.
From startup to success
EquipmentShare wasn’t the Schlacks brothers’ first business venture. The pair has started a computer company, some other service-based businesses and a couple of construction companies.
“We’ve owned quite a few businesses over the years, since I was about 14, and Jabbok was 18 or 19,” Willy says. “We’ve never not owned businesses.”
So, when they started EquipmentShare, they already had a plan in place. One of their first acts was to bring EquipmentShare to Startup Weekend Columbia last fall. After a weekend of hard work, EquipmentShare took home first place and $2,000 in startup capital. Later that winter, the company was accepted into Y-Combinator, a business incubator in Silicon Valley that has worked with Reddit, Dropbox and Airbnb, where it received advising services and $120,000 in capital.
After a few months of fundraising and beta-testing software, EquipmentShare launched this past February. Headquartered in Columbia, EquipmentShare already serves about 1,000 companies throughout Missouri, Kansas and Illinois, with revenues growing about 10 percent every week. Willy and Jabbok hope to expand to Texas and Florida this fall and eventually reach every state and even take EquipmentShare international.
“We have talked with several companies and people interested in taking it overseas in Germany, Australia, Sweden and some other places,” Willy says. “Right now, we’re probably a year out from going overseas, but it’s definitely a goal.”
Continued growth is necessary with a company like this, Jabbok says, because more customers mean more equipment to share. “It works better for everybody if more people are in the system,” Jabbok says.
“We started the company with one thing in mind,” Willy says. “We make decisions based on whatever helps contractors and benefits them.”
Despite a potentially international footprint, the brothers hope to keep the company headquarters in Columbia.
More than ‘tech’
Even though EquipmentShare is considered a tech company, Willy thinks technology is just a means to an end.
“Technology is there to serve us; it’s not an end in itself,” he says. “It has to serve the end user. It has to serve the customer. It has to make your life easier. It has to connect things. Creating something that’s cool and fancy is not enough; it has to solve a problem.”