- What is Turo, and how does Turo work?
- How does Turo make money?
- Insurance Fee (for Hosts)
- Trip Fee (for Guests)
- Guest Protection Plans
- Young Driver Fee
- Turo subsidiaries, acquisitions, and exits
- Turo profit and revenue
- What is the Turo business and revenue model?
- Turo funding, net worth, and valuation
How does Turo make money? Here is a full, in depth, breakdown of their five (5) revenue streams and the different products and services they offer, as well as the Turo business and revenue model, how much Turo makes per year, and how Turo works.
What is Turo, and how does Turo work?
Turo is a peer to peer car sharing company that allows car owners to rent out their personal vehicles to renters on their marketplace. It has been deemed as the “Airbnb of cars”.
Founded in 2009 by Shelby Clark, Turo now has more than 350,000 vehicles listed on the platform and operates in over 56 countries, making it the largest peer to peer car sharing company in the world.
So, how does Turo work? To use Turo to rent a vehicle, users can first start by downloading their mobile app through the Apple App Store or Google Play store; or by visiting their website to sign up for an account.
Once signed up and approved to drive, guests can look for their next rental by simply entering in a location and date and browsing from over 1,300 makes and models of cars by local hosts.
From there, guests can book the trip, choose a protection plan, pick up the car from their host (or have the car delivered to them if the host offers this), and hit the road.
Some of Turo’s competitors include Getaround, HyreCar, and other car sharing companies.
How does Turo make money?
According to reports, Turo now has more than 350,000 vehicles listed on its platform from more than 85,000 active hosts, as well as having over 1.3 million active guests.
So how does Turo make money off of all these active hosts, guests, and vehicles listed?
Below is a breakdown of how much money Turo makes and its revenue model. Including all revenue streams and how much they charge for their services.
Here are the 5 ways of how Turo makes money in 2022
Turo has a revenue model that makes money in five (5) ways; from host insurance fees, guest trip fees, guest protection plans, young driver fees, and taking a percentage from extras.
#1. Insurance Fee (for Hosts)
One of the ways Turo makes money is through the percentage they take from car owners, or hosts, on each completed trip.
Turo offers hosts five (5) insurance plans to choose from; the 60 plan, 75 plan, 80 plan, 85 plan, and 90 plan. Each of which comes with its own perks and downsides.
Put simply – the more Turo takes, the more they shield a host from vehicle liability. The more the host keeps, the less Turo shields a host from vehicle liability.
- Turo takes between 10% to 40% of each trip booking total (depending on the plan the Turo host chooses)
#2. Trip Fee (for Guests)
Turo also makes money from its guests who book the vehicles by taking a percentage of trips’ total price called a trip fee.
According to Turo, the trip fee Turo charges guests is dynamically priced based on the expected trip total. Some of these factors include the vehicle’s value, how far in advance the trip was booked, trip duration, and more.
#3. Guest Protection Plans
Turo also charges the guest’s insurance liability plans to choose from in case of any damage caused to the host’s vehicle during the trip.
It works the same way as the host’s insurance plans (as talked about above). The more a plan costs, the less a guest is responsible for paying out of pocket for the damages caused to the host’s vehicle during the trip.
Turo offers guests four (4) protection plans to choose from; Premier plan, Standard plan, Minimum plan, as well as the choice to decline a protection plan.
Turo charges guests based on a percentage of the trips total booking price. For example, if a guest chooses the Premier plan and is charged 100% of a trip price that costs $300, well then the guest will pay an additional $300 for the protection plan, totaling $600. ($300 for the trip + $300 for the protection plan)
How much do Turo guest protection plans cost?
- Premier plan: 65% to 100% of the trip price (minimum charge of $14 per day)
- Standard plan: 40% of the trip price (minimum charge of $12 per day)
- Minimum plan: 15% of the trip price if more than $250 or 25% of the trip price if less than $250 (minimum charge of $10 per day)
Note: If a guest declines a protection plan, Turo will charge no fee but the guest is 100% responsible for paying all costs in the case of any damage(s) during the trip.
#4. Young Driver Fee
Another way Turo makes money from its guests is by charging drivers (renters) under a certain age a young driver fee.
This fee applies to US drivers who are between the ages of 18 to 25 and UK drivers between the ages of 18 to 24. If a driver meets these criteria, Turo will automatically add this fee to the trip total. Which you can see how much it costs below.
Turo young driver fee:
- age 18 to 20, drivers pay a minimum young driver fee of $50 per day
- age 21 to 25, drivers pay a minimum young driver fee of $30 per day
When a guest a booking out a trip, they also have the option to rent out “extras” from the hosts that offer them. These include things like child seats, phone chargers, sporting equipment, etc.
From which, 90% goes to the host and Turo takes 10%.
Turo subsidiaries, acquisitions, and exits
To date, Turo Inc. has made a total of 4 acquisitions.
Turo profit and revenue
In 2021, Turo reported $330.5 million in revenue.
Note: Because Turo Inc. is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.
What is the Turo business and revenue model?
Turo makes money through a few revenue models that they combine within their company, they are:
- Transportation as a Service (TaaS) business model
- Fee for service (FFS) business model
- Commission based business model
- Transaction based business model
- B2B2C (partnerships) business model
- Business to business (B2B) business model
- Mergers and acquisitions (M&A) business model
Turo funding, net worth, and valuation
According to Turo’s Crunchbase profile, Turo has raised $502.6 million over 13 rounds with a valuation of $1 billion as of April 2022.