TULU
The TULU room in New York's Oskar building.
- TULU, a one-year-old Israeli startup, partners with landlords to provide rentals via app for anything from folding chairs to VR headsets.
TULU has launched in a New York building, its first location outside of Tel Aviv, Israel. The company wants to expand to 40 buildings in New York by March.
- The startup is betting that people will turn to on-demand rentals instead of outright purchases in order to save space.
- Visit BI Prime for more stories.
Average apartment sizes have been shrinking, and the unstoppable year-end force of holiday gift-giving threatens to fill the, to the brim with new appliances and gadgets.
TULU, a year-old Israeli startup, offers a solution: trading ownership of household items for rental. TULU partners with landlords to provide anything from folding chairs to VR headsets for rent from a room that's accessible with an app.
TULU said it has launched in a New York building, its first outside of Tel Aviv, Israel. The company wants to expand to 40 buildings in New York by March, cofounder and CMO Yael Shemer said.
Shemer noted that scooter startups Lime and Bird were major influences, while CitiBike's model organized around hubs echoes TULU's rental-rooms.
"It doesn't make sense for everyone to own a drill, vacuum, iron or printer. We don't want to waste money and don't have room to store them," Shemer said.
TULU's first New York location is in Oskar, a 164-unit rental building on the border of Hell's Kitchen and Hudson Yards operated by the Moinian Group. The room is accessible around the clock, and tenants in the building can rent items for a few dollars an hour. There is no membership cost other than renting in the building, but users can purchase a daily pass, and a subscription for unlimited use is in the works.
To be sure, some apartment buildings already offer chairs and tables for tenants when they have a party or event, and the rental model has been gaining popularity in retail products. Both Lowes and Home Depot offer power tool rentals, while other companies provide carpet cleaner and wet-dry vacuum rentals. Where TULU separates itself is that it is on-demand, in a tenant's building, and focused exclusively on household items - think the newest model of Dyson instead of an industrial wet/dry vacuum.
Coliving, or residential rentals that trade private living space for shared common areas and more amenities than typical apartments, is also attempting to tackle increased density by sharing between tenants. Two of the largest European coliving companies, Quarters and The Collective, have recently expanded to the US.
While the phrase "sharing economy" has become commonplace in massive businesses like transportation and real estate, some of the biggest names have had a rough year.
Uber's share price has plunged since the ride-hailing company's initial public offering, and WeWork's IPO failed entirely, as both companies grappled with wide losses and an unclear path to profitability. Coworking has made way for enterprise businesses, turning coworking companies from shared resources for startups to outsourced real estate and facilities departments.
TULU was founded by three students of the sharing economy, Shemer, CEO Yishai Lehavi, and COO Itamar Mofaz, who met at MIT's designX accelerator. After developing the product, they moved back to Tel Aviv, and launched their pilot with a vacuum, some chairs, and a few other items. As they grew, they turned their eyes towards New York.
"Every big city experience is going through the same fundamental shift," Shemer said, speaking about increasing density and decreasing apartment size.
TULU's executive team sees New York, with its small apartments and reputation as the capital city of real estate, as a perfect place to expand. The company wants to add five more cities over the next two and a half years, including two US markets. It is targeting high-density, expensive cities where sharing suitcases and vacuums would open up more space, and has also considered expanding to dorms.
TULU is constantly changing its inventory, but a mix of household appliances and leisure products make up the backbone of its offerings.
"We want to offer a service that solves problems, but initially not all products are necessities," Shemer said about TULU's VR headset rentals. The company has a warehouse in New York where additional products are stored, and says that it uses demographic data and usage data to determine what to stock in a building.
Beyond geographic expansion, the company has developed partnerships with a camping equipment and a home maintenance company, and Shemer said that it hopes to continue adding more partners. In return for TULU paying cheaper prices for products, the company can give detailed feedback on a product's usage and durability in the real world.
TULU is also betting that renters will turn into buyers of the items they are already familiar with if they move into more spacious homes.
"When they move to the suburbs, they'll want to own those things," Shemer said.
- Read more:
- 12 proptech startups that have won millions in investor backing to upend how you pay for your house
- Developers have zero incentive to fix the affordable-housing crisis. Here's what one real estate exec thinks could change that.
- Proptech is getting a ton of attention, but its exact definition is hard to pin down. Co-founders of a big VC in the space spent 18 pages of their book trying to explain it.