In a country with a lot of land, limited public transportation, and the world’s largest economy, cars seem like an obvious choice for Americans to get from place to place. Car ownership is only growing in the United States, with 91.5% of households having access to at least one vehicle in 2020. But cars aren’t just a transportation solution. They also come with their own set of problems, including maintenance, repair, and insurance costs.

Through fractional car subscriptions, Upshift lets customers enjoy the perks of driving a car without suffering the usual pains. Subscribers simply book a car on the app, and they can have a car ready to go whenever they need it. We reached out to co-founder Ezra Goldman to hear more about his bootstrapping experience and Upshift’s conception.

Note: This interview was conducted over phone and email. It has been lightly edited for clarity and length.

Funding Round Details

Upshift logo
Company: Upshift
Security Type: SAFE
Valuation: $15,000,000
Min Investment: $150
Platform: Republic
Deadline: Nov 18, 2022
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What inspired you to take the leap and work on the first version of Upshift?

I had been using carshare a lot but found it was expensive, unpredictable, and unreliable. I didn’t want to buy a car since I mostly wanted to use it to go hiking on the weekends, and it felt like an expensive headache and a waste. About 124 million cars in the US are driven less than 10,000 miles per year — but they still have all the headaches of car payments, insurance, maintenance, parking, etc. 

How did you pivot from your initial idea and come up with your current business model?

The initial idea was fractional car ownership for two people to co-own a car. This was too complex. Scheduling, maintenance, cleanliness, etc. all really need a manager with a fleet of vehicles to ensure reliability, consistency, and availability. We decided to deliver cars because co-owners might live far apart and vehicle automation would eventually make it standard.

Car delivery would be complicated logistically, and we needed a platform to iterate on the business model, so we launched with a car rental delivery service. We later pivoted to a fractional car subscription service, and that really enabled us to provide a predictable, personalized service that is a true car leasing alternative for low-mileage drivers.

What progress did you make since your last raise?

Since we closed our last Republic campaign 18 months ago, we’ve integrated telematics across our fleet, so members can locate, unlock, and drive our cars via app. This streamlines our delivery operations since our team doesn’t need to meet in person and can deliver cars in the most efficient order. We also relaunched our delivery logistics app and built a new dispatch backend to scale our deliveries. We tripled recurring revenues, doubled the size of our team, and increased our fleet by 50%.

Who is on your team and how did you come together?

I co-founded the company with my wife, and her grit and entrepreneurial drive has supported us through some of the biggest challenges. In the founding period of the company, we drove for rideshare and cleaned people’s apartments as gig workers to bootstrap. We’ve come a long way since then, and many of our teammates come from relationships cultivated over the years and industry connections. 

How is Upshift transforming the car leasing industry?

We call our leasing model “fractional leasing.” It’s customized to you. You pay only for the days you use the car, and we take away all the other hurdles and headaches for you, like gas, insurance, service, cleaning, and parking. 

If you use a car realistically anywhere between four and 12 days a month, it means the car is not in use at least 18 days every month. So you are paying a ton of money every month to have a car on standby. It’s crazy. So, we’ve created this new car leasing model that works for people and the planet more than it works for traditional car leasing companies.

How do you intend to use the money you raise this round to scale the business?

We’re going to integrate teleoperations across our fleet. This will allow us to deliver the cars remotely from headquarters and to serve less dense areas, like suburbs and smaller cities. Second, we’ll expand our service to a second city. Finally, we want to begin to electrify our fleet.

As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? Have you set any future goals for the company?

Aside from initial public offering, the most likely exit strategies we envision would be to a car manufacturer, rental car company, or car dealership conglomerate looking to gain technology, data, and operations capacity. Upshift is the future of the car dealership for when people subscribe to cars as a service, so any legacy automotive stakeholder is a potential acquisition target.

We look forward to seeing where Ezra and his team take the company. Upshift is currently raising on Republic.