Fetch is Shutting Down

It’s with incredible disappointment to share that we’ve made the difficult decision to shut down Fetch.?

While my co-founder Chris and I desperately wish the outcome was different, we remain incredibly thankful to all of our customers, partners, colleagues, investors, friends and family that supported us throughout this 8.5 year journey.

In this note, I’ll outline why we are making this decision now and some initial lessons learned. While it’s frustrating and disheartening to share this news, I hope that this note can provide some context and learnings for other entrepreneurs.

What happened? Why now?

In 2016, born out of personal frustrations with renting trucks, Chris and I landed on a risky and ambitious idea to reinvent the truck-rental experience using hardware and software.

Throughout the past 8 years, we built clear value in technology and customer experience, struggled with unit economics, and saw bright flashes of product-market fit.

Why are we winding down?

Unfortunately, revenue has been decreasing over the past several months, and Fetch is approaching becoming financially insolvent. In the interest of having time to conduct an orderly wind down, our legal counsel has strongly advised the company to pursue a dissolution.?

In March, we experienced the SVB collapse and our largest fleet partner canceling their partnership with Fetch - all within 48 hours.

After this, we were able to pick ourselves up off the mat one more time, and we had enough cash in the bank for one last hail mary to generate the required growth in the business.?

The only viable bet we could make at that time was to quickly grow the supply side of our marketplace by focusing on enabling in-person P2P truck rentals that did not require our contactless hardware. April and May were promising, as we did see an immediate uptick in new trucks being listed on the marketplace under this model. We were guardedly optimistic.?

Unfortunately, new problems quickly emerged. These include:

• Truck owners not fulfilling reservations booked on their vehicles
• Owners making their vehicles unavailable for same-day rentals. (Same-day rentals make up more than 50% of the demand side of the marketplace.)

Additionally, our data indicates that macro demand for truck rentals is down 50% from 2020 and 2021 levels, which has compounded our challenges in growing GMV and revenue.

The end result is that overall revenue has dramatically decreased over the past 60 days.?

Without a clear and immediate path for fixing these challenges and restarting growth, we made the disappointing conclusion that the prudent course of action is to wind down the business. We ran out of time.

What’s the history of the company?

• 1H 2015:?
• Chris and Adam found the company around marketing automation software
• Y Combinator acceptance
• 2H 2015:
• Realize original idea won’t work; start pivoting
• 2H 2016:
• Land on an ambitious and risky idea of re-inventing truck rental with automation, software and hardware; Fetch is born
• 1H 2017:?
• Launch the first contactless truck rental
• Scale a fleet of corporate-owned vehicles. Chris and Adam manage, clean, maintain and even repossess trucks.
• 1H 2018:
• Pivot to a marketplace business to enable partners to utilize the Fetch technology and deploy their own trucks on Fetch
• 2H 2018:?
• Launch strategic partnership with one of the largest truck rental companies in the world
• 2H 2019:
• Knoll Ventures joins as Seed investor?
• Launch first version of P2P program to grow supply
• 1H 2020:?
• Pandemic; fight for survival
• 2H 2020:
• Launch strategic partnership with another F500 company
• 1H 2021:?
• Relaunch of new iteration of P2P program to increase supply
• Demand explodes; revenue grows nearly 4x YoY
• 1H 2022:
• Nextview Ventures leads $3.5m investment round
• Launch strategic partnership with a new F1000 company
• 2H 2022:
• Supply chain shortage create challenges in vehicle availability and supply growth
• 1H 2023:
• SVB collapse
• Lay off 70% of team in March to preserve cash
• Relaunch P2P program without contactless hardware (in person rentals) with aim to grow supply

Lessoned Learned

As we’re in the midst of the very difficult process of shutting down the company, it’s difficult to say exactly what the lessons learned are.?

I suspect once we’ve had time to reflect, one of the key lessons learned will be the importance of unit economics and gross margin, even in the early days of the business. With Fetch being a mobility marketplace that also leveraged hardware, we had a tremendous number of moving parts and costs to the business.?

Marketplaces really only work at scale, and without scale, our economics were very challenging. For example, our insurance costs for each rental on Fetch are incredibly expensive, and we also had hardware connectivity fees for each vehicle.

While we squeezed every ounce of efficiency out of the business - and we were able to generate a positive contribution margin - the margin wasn’t large enough to get to default alive economics without more scale in the business.

We knew that scale would be essential to the business's success when we started Fetch. We’re disappointed we couldn’t get there fast enough.

Closing

While Chris and I are very disappointed, we have a lot of gratitude for the journey and are proud of many aspects of it.

I’m proud of the way we ran our business and always tried to put our customers, colleagues and investors first.?

I’m proud that we were able to generate a positive contribution margin in a very challenging hardware-enabled consumer marketplace business.

I’m proud of the technical innovations we achieved around automation and contactless rentals. We solved an incredible number of very challenging technical problems across hardware, firmware and software. We pushed the industry forward in a positive way and attracted the largest companies in the industry to work with us.?

I’m proud of the fact that two co-founders stuck together for 8.5 years and gave the business everything we had.?