Faaren – Car subscription agent

Profile:

• Company name: Faaren GmbH
• Industry: Mobility
• Formation: July 2018
• Founders: Daniel Garnitz, Maximilian Renoth, Konstantin Stenzel, Eike Ben Seifert, Fabian Hagen
• Location: Rottendorf, near Würzburg
• Number of employees: 8, further hires planned from May 2019 onwards
• Turnover: no details
• Investors: enowa innovation lab GmbH, as well as other local cooperation’s
• Total funding amount: not known
• Subscription-based model since: Start
• Offer structure: Faaren car subscription: monthly subscription of cars, including free kilometers and all costs (except fuel).

More flexibility in the mobility market. This is the goal of the Rottendorf-based company Faaren. Faaren itself takes on the role of intermediary and brings interested parties and car dealers together. The advantage of this innovative subscription model is that larger amounts of capital are not needed as an intermediary, because Faaren does not buy cars. Instead, the tenant collects the car from the contracting partner or, alternatively, it is delivered to their home. 

The Faaren car subscription

The Faaren car subscription is advertised on the website with fair rental conditions. Insurance, taxes, wear and tear and repairs, maintenance, TÜV and tires and tire changes – everything is included in one monthly rate. Only the fuel has to be paid for by the subscriber. Faaren currently offers cars from Audi, Volkswagen, Nissan, Opel, Hyundai and Ford. Most of these are annual and demonstration vehicles and leasing returns. However, new cars will also be available soon.

All inclusive from 400 euros per month

The price range starts at a monthly price of €400 for a small car up to €1,000 for an SUV. Cabriolets, motorhomes and vans can also be subscribed to. In addition, various kilometer packages are offered – starting at 1,250 free kilometers per month, up to 5,000 free kilometers (= 60,000 km / year). In addition to a clear price structure, Faaren also offers fair rental conditions. The minimum contract period is only one month, with a cancellation period of 10 days. Moreover, the interested party can change the car every month.

The Faaren Story: From Total Failure to Total Success

In 2015, the current Faaren founders began their e-commerce studies at the Würzburg-Schweinfurt University of Applied Sciences. Three years later, founder Daniel Garnitz’s eleven-year-old Audi A3 had a total economic loss. A virtue was made of this necessity. Through the Centre for Digital Innovation and the Innovation and Start-up Centre, contact was made with BayStartup. Through this start-up network, the Free State of Bavaria provides a free and official coach.

The beginning of a success story. The first cooperation took place in April 2018 with a car dealership in Würzburg. The founders initially financed the platform itself out of their own pockets before the management consultancy Enowa invested in the young company as part of a pre-seed round. Nothing is known about the amount of the investment.

Faaren car subscription: the “streaming” for cars

“Car ownership as easy as streaming series”. That’s what the website faaren.com says. In fact, the Faaren founders describe themselves as the Spotify for cars. Unlike competitors such as Cluno or Like2Drive Faaren does not buy the cars, but merely mediates between car dealers and interested parties – similar to Netflix or other streaming providers. Here, too, the subscription operator only incurs costs when the service is used. So there is no classic purchase.

The automotive industry discovers flexibility

Looking at the latest statistics, more and more cars are being registered for road traffic. In the first ten months of 2018 alone, an increase of 1.4 percent was recorded. Car use thus continues to rise despite the diesel scandal and stricter environmental regulations. At the same time, the share economy and the need for flexible subscription models continues to grow unabated. A 2018 study by the auditing and consulting firm PwC shows that around 40 percent of Germans already use sharing offers.

And the trend is rising. While usage at the time of the survey is predominantly limited to popular share economy offerings such as Airbnb or streaming providers, this can certainly be understood as a trend for the entire economy. Especially in the field of mobility, subscription models are experiencing a major upswing, as can be seen from the many new companies, such as Cluno, Like2Drive or Sixt Unlimited, in addition to Faaren. Owning obliges, but renting and sharing does not – at least only within a manageable framework.