I Rent Out Other People's Stuff: How to Build a Six-Figure Business (Greatest Hits)

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1:14It's true. What's up? What's up? Nick Loper here. Welcome to the Side Hustle Show, part of the entrepreneur podcast network because your earning power doesn't have to stop when your day job does. Now, you know why I love a rental business model. It's one of the four types of passive income. You can quiz your friends what the other three are. I'll fill those in at the end of the show. But today's guest scaled his rental business in a unique way by renting out other people's RVs with their permission, of course. Could you do the same thing? Could you apply the same idea in a different niche? Let's stick around and find out from FiresideRVRental.com, Gar Russell.

1:51Welcome to the Side Hustle Show. Hey, Nick. Thanks for having me. Excited to be here with you. Well, I'm excited for this one. we're covering how Gar convinced other owners to trust him with their RVs. That's a big step. The logistics of running this thing and the bumps in the road along the way. I want to start off with, you have this idea, like it's going to be a fantastic birthday present for your lovely bride or an anniversary present rather. And hey, honey, we got this RV. Let's go. We're going to have all these fun times in the woods, imagining the years of outdoor fun and adventure ahead of you.

2:22And her reaction is not quite what you're hoping it will be. Yeah, we got to the campground and we got set up. I thought all was going well. The first morning when she's chasing our toddler around and seven months pregnant with number four, and she said, I'm going home, baby. And I thought, oh, what did I forget? And I didn't forget anything. She was just miserable. And she was done camping. And we were supposed to be there six more days. Yeah, so that's not how anybody wanted it to go down. No, no, not at all. And I went right into panic mode of, oh my gosh, I just bought this RV for a lot of money and my wife doesn't want to be here and jumped onto Craigslist and threw it up for rent.

3:07Okay. So you've got this big expensive asset slash liability at the moment, but hopefully it turns into an asset sitting in the driveway and said, well, shoot, what am I going to do with this thing? So you turn around, put it up for rent on Craigslist. What kind of reaction does that get? Any takers? Yeah. You know, it blew my mind. I literally had inquiries coming in within a couple hours. So the light bulb like immediately went off. People are, hey, I need it for this weekend because that was in July when I purchased it for. So it's like in the middle of summer and people are like, oh, hey, we're going camping this weekend or that weekend, you know?

3:42Sure. So it was, it was wild. Any sort of like driver vetting? Do you need like a commercial license to drive one of these things? I'd be intimidated driving around something in that size. No, you go right to what people typically ask when I ask them for their RV is, okay, who's going to be driving this? What's that going to look like? And so yeah, there's just like Airbnb and Toro, there's peer to peer platforms for this industry. So they have the insurance and the driver verifications and security deposits and you know, all the things. Right. So that is in place. Now, what was your process early on starting out?

4:16Well, no. So when I started, there was, who is still the main platform, RVShare.com. They were up and running. They started in 2013. I started in 2016. I just started running rentals like right through RVShare to use their insurance and all that stuff. Oh, okay. Okay. So we got some initial traction on Craigslist, but hey, go check out my listing or go check out my profile book through RVShare, one of the leading platforms, Outdoorsy being the other one, where it's the peer-to-peer marketplace. It's the Turo, it's the Airbnb for renting RVs. So there was an existing demand here. And I think that's probably an important place to start is saying, well, it wasn't necessarily reinventing the wheel.

4:56It's like, hey, I'm going to go put my buy button up for sale on someplace where people are already looking for this thing to go rent this thing. And so there was a precedent for doing that rather than trying to create demand out of nowhere. Exactly. Yeah. What'd charged for those first weekend rentals? Maybe like$100,$125 a night or something like that. Okay. Gosh, I imagine. I remember these things were completely blown up during the pandemic. Like, well, I can't do anything. I want to go camping. I want to go rent an RV. I want to rent a Sprinter van. And sometimes it'd be like$250,$300 a night for some of these nicer decked out vans.

5:32Oh, yeah. Yeah. You can pay a premium. We've got some nice Super C diesels and some nice class B's and some big class A's that, yeah, rent for$400 or more a night. We just had a guy that paid$6 ,000 to have an RV delivered from Alabama to Michigan for a festival because he liked that unit so much that it just was incidental. The money was just, okay, what's the cost? And he had had it for Talladega races and he wanted it for another event he was going to. Was there a target occupancy or a target monthly income that you're trying to hit to offset the payment, the depreciation? Like something that would make it less of like, oh, you know, this big money pit sitting in the driveway?

6:17In the heat of the moment, no. It was literally just getting away from the pain of feeling like a weirdo for buying a camper that my wife hated. Then as things scaled and escalated, yeah, then you start getting a little more granular. And like, okay, for the wear and tear on this, and ours was a, I always say towable travel trailer or drivable RV to help people differentiate. Ours was a towable travel trailer. So there wasn't as much wear and tear like engine, you know, mileage generator, stuff like that. Okay. I'm picturing like a Airstream or something that would like attach to a hitch or like a fifth wheel.

6:50Yeah, exactly. That was our first that started this business. Yeah. It was a towable. Interesting. And then for somebody starting out on RV share, what kind of best practices did you find to get listing to your attention? Because like, okay, Craigslist kind of, I guess people will be seeking it out. But now all of a sudden, if you're on these platforms, you're competing with dozens of other listings in your area. So like, well, how do I make mine the one that they click on and want to book? Just like anything else, honestly, real estate, throwing something up on Marketplace. pictures is obviously a huge one.

7:26Painting a picture for somebody like them seeing themselves inside of that travel trailer, seeing their family inside of that. Is the layout going to work? Is it going to have the right amenities that it needs? So that's something that I realized was important right off the bat is really helping people understand because these people that were renting my camper, they weren't campers. They just wanted to go camping. So it was really painting a really clear picture for them. Fast forward down the road to we've got 45 locations across the country now. Franchise is doing this. Competing with others, it's all about creating value, showing the value where so many people that jump on these platforms are just lowering their prices, lowering their prices, you know, like, hey,$40 a night, rent my camper.

8:09So our whole thing is showing value. It is interesting as you walk down that road and you scale and you start to really think about your market and the best way to serve them. Right. At a certain price per night, it doesn't pay for the hassle of dealing with the logistics and the wear and tear on the thing. And just, I don't know if that's worthwhile. It's got to make sure it is worthwhile. Exactly. Yeah. Especially on the drivable RVs where you're putting miles on an engine and wear and tear is you've got to be very mindful of depreciation. Depreciation is a great side of this because just like real estate, you can depreciate it.

8:44But also, like you mentioned at the beginning there, this is a liability to start. It's not like a piece of real estate where it's going to appreciate. It's depreciating the moment you buy it. So it's being very mindful of that. All right. So you start to see some traction on RV share a little bit through the Craigslist ad. You say, OK, there might be something here. I'm no longer losing money on this thing or I'm no longer losing as much money on this thing. You're like, well, the way to scale is more inventory here. There's only so many weekends in the month. There's only so many days in the month.

9:17Somebody could rent this thing. So if I want more inventory, I got to go out and find more RVs. So what is this conversation like? How do you find the first people to say like, have I got it? A business proposition for you. I'm going to rent some strangers. I'm going to let some strangers into your vacation vehicle here. And I'll give you a cut of the proceeds. Like what do these conversations start? So it didn't start with that model, what I call the OPRV model. It really started with, I need more RVs. So literally fast forward to the end of August, we're having number four that my wife was miserable with in July, pregnant.

9:50All of our kids were born on C-sections via C-section. So literally it's like scheduled. You know what you're going to do? You check into the room. It's like, okay, baby is here. You're in the room. So I get my wife and baby checked into the room and then literally I'm like, all right, honey, I'll be right back. And where was I going? I was headed to the dealership to buy four more RVs. Oh my gosh. Okay. She's like, oh, okay. She's been an entrepreneurial spouse for long enough to know. We just do weird things like that as entrepreneurs. But literally as I'm doing that, the Lord was like, OPRV.

10:24That's when I got the OPRV method was God telling me that. I still went and bought the RVs because I'm already driving there. I'm a little dense. It takes me a little bit to catch on. But a couple weeks later, that's when it clicked. No, it's other people's assets. So that's when I started reaching out to other people like, hey, I want to take your RV and rent it. And it was literally one of two things. First person I asked was my sister-in-law. And she's like, that's gross. Like someone's not sleeping in my bed. That's a very bad idea. That's what I imagined the reaction was going to be like, ah, no thanks.

10:55We bought it for our own family. Like, yeah, that's weird. And then I reached out to my best friend, Jeremy. And Jeremy's like, dude, that's sweet for sure. Sign me up, man. And so there was unit number two and it went on from there. What was the proposal? What was like the rev share? What kind of pitch did you come to it with? It was very simple. It's, Hey, I'll do all the work and we'll split the revenue 50, 50. So he had a nine to five. I didn't, I own some businesses in real estate and I had freedom in my schedule to do different things. That was the presentation was I'm going to do all the work.

11:28We split the revenue 50, 50. How did you deal with getting the RVs to the customers? I guess it's all local or they come to your place and pick it up or, you know, just I think of like moving vehicles all around, like with rental cars, like I pick it up at the airport and then I fly away and drop it off. Like it's somewhat easier, but in this case, it's like, well, where do I store the thing? Now, if you've got five of them, where do I store these things? Plus, you know, trying to meet people where they're at. Yeah, it was me and my truck and moving units around. And I lived on some acreage, so I decided, okay, I should probably start grouping these things together logistically to make a little bit easier myself.

12:07And then I got a violation from the city that I wasn't zoned to do that. So then it moved into, all right, well, I want to keep doing this. So we got a parking lot that we rented out. Okay. Okay. Went from there to, we got our own facility. We're like, well, we can collect storage on these when they're not being used. So we'll get a facility that'll cover our overhead for the facility, the storage fees. And it just, yeah, one thing to the next. Next thing you know, I have RV techs working for me and I have storage and I sell propane and we have a dump station and all these different things. Oh, sorry.

12:41Explain the storage fees. Sorry. I'm confused on that part. Most people pay to store their RV as storage facility. So that's what we did. We just ended up grouping them together. And that's how a lot of our franchises run today is they just partner with a storage facility near them and they group the RVs there. So for them, they don't have a lot of that overhead as far as having to have like a brick and mortar and all that overhead. Got it. Okay. Here's the centralized parking lot to come and pick everything and go on your way for your trip. Okay. Exactly. Yep. Got it. All right. Gar's got his first OP RV on board.

13:15He's proven out the concept and now he's on the hunt for more owners who will let him rent out their RVs, that process, and more coming up right after this. Whether you're a seasoned business or you're experiencing your very first Black Friday Cyber Monday, you need a platform that can handle the rush. The last thing you want is inventory errors or your point of sale crashing when new customers are trying to buy for the first time. So make sure your business is ready for the busiest time of the year with help from our sponsor, Shopify. Shopify is the commerce platform behind millions of businesses around the world, including dozens of side hustle show guests and 10 % of all e-commerce in the U.S.

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15:42That's No missed calls, no missed customers. All right. So you get the first OPRV on board and say, hey, I'll do all the work. We'll split the revenue. Sounds good. Deal. Sign me up. What happens after that? It's like trying to find RV campsites nearby and canvassing people, although those might be renters themselves. Or you go into RV owner Facebook groups and saying, hey, have you ever thought about this, but trying to approach it in a non-skeezy way and get kicked out of the group? I'm just like, how does it scale? It's scaled on the finding the renter side. I would create ads on Craigslist for rent.

16:21And then really I just leaned on the peer-to-peer platforms. So RV Share, Outdoorsy, and there's a couple others. They were basically handling my lead generation as far as finding me renters. And then on the finding owner side, that's really easy. I mean, there's RVs. There's over 12 million RVs sitting around doing nothing. So what I did was someone had an RV in their driveway, I knocked on their door, went to storage facilities, tried to strike up deals with like mom and pop facilities to talk to their owners. And then just like, you know, if you're renting your house on Airbnb, they have Airbnb Facebook groups.

16:54I started joining those groups for people that were renting their RV and just kind of sharing, hey, if you find like this is too much work for you with your nine to five, I'm happy to do the work for you. and then just kind of sharing my entrepreneurial history and real estate. Okay. Like an Airbnb property manager or like a co-hosted Airbnb thing, like where you still own the asset. Hey, we're not going to buy it from you. We are going to take a percentage. We're going to handle the booking requests. We're going to handle the customer interaction, the cleaning, all that stuff. And you can still make money from it.

17:26Yeah, exactly. If you like renting your RV, but you don't like to work so much, we'll do the work for you. Okay. So targeting, it sounds like people starting out who were used to that idea rather than trying to force yourself upon the market of just those 12 million RV owners who maybe hadn't considered that as an income stream. They just have it for personal use and they don't really care. I imagine you could probably convert some of those, but going after the people who are open to renting it or have proven to be open to it already, that's a warmer market to tackle. Yeah. And especially now post-COVID, like you talked about everybody RVing and everybody buying an RV during COVID.

18:03Yeah. Now a lot of our pool that we draw from is just Facebook Marketplace, just going on there and just sharing the concept with people. Hey, I see your RV's for sale. It's beautiful. If you find that you're getting lowball offers and maybe you need to pay your principal down some, we've got a program that we've created to help with that. If you want more information, we'd love to tell you. Interesting. Yeah, it's a really interesting product class because of that super, super low utilization rate. where it's like, it probably sits around 50 weeks out of the year. I mean, some of the stats on cars sit idle 22 hours a day or something.

18:38It's like, for this, it's got to be even more averaged out on a daily basis. And so that makes it a really interesting asset to try and improve that a little bit. Hey, sitting around, let some other families enjoy it. We'll put some money in your pocket and go from there. So you start to get some traction doing that and trying to manage primarily local or is it kind of branching out geographically at this point? I imagine with different Facebook groups. It's a nationwide or international audience. Yeah. When we started, it was primarily local. We kind of found our niche. A lot of people going to specific state parks for family camping trips.

19:11And so we would kind of figure out where we would want to serve as far as how far we'd want to deliver and stuff like that. Yeah. It's just amazing. There's campgrounds everywhere. There's storage facilities everywhere. There's RV dealerships everywhere. It's kind of like you buy a red car, then all of a sudden you realize how many red cars are out there on the roads. RVing is everywhere. It's what a lot of Americans do. What's the one I used to always see in RV America? It's one big, it seems to be a nationwide rental outfit. Yeah. Cruise America. Yes, yes, yes, yes. Yeah. So Cruise America is still around.

19:43They're the billboard on wheels, basically. It's really interesting because learning the RV industry now over the years, a lot of dealerships used to rent RVs out. And that was a lead generation tool for them. That was a way to take new inventory, make some money off it, depreciate it a little bit, and then turn around and sell it used. And then there was like this mass exodus. And basically, who do you have left? Cruise America. And there's a couple other guys out West. And then in 2013, this industry just came up out of nowhere. It was literally the founder of RV Share took his family on a camping trip.

20:16And when he got back, he's like, all right, well, I traveled across the country like I wanted to do. Now I have this RV. What do I do with it? I'm going to rent it out. And he went in line to look for a platform and there wasn't one. Yeah. And that's how RV share was birthed. Is the Cruise America model more like a rental car business where they own the units or is it similar? Whereas like, well, the ones that I remember seeing were all pretty uniform. It seemed to be like the same model. Yeah. Cruise America, they have them built in batches and And it's similar models. And they kind of operate a little bit like U-Haul.

20:49Like they'll partner with businesses that have a little bit of real estate where they can park some RVs and they give them a percentage of the revenue. Yeah. I love the rental business model. If I'm pausing, it's because my gears are turning. I'm like, well, what other, maybe it's industrial equipment or something. I'm thinking about the stuff that I would go and rent for my painting business. Like, well, this big 40 foot ladder, or there wouldn't make sense to own that because you only needed it maybe once or twice per season. And but you go to the United Rentals, I think was the place and you rent this for the day or rent this for the week if you needed it on the job site.

21:22It's like, what are the other things with like super low utilization, maybe kind of a high upfront cost where do I really want to buy that, especially from the point of view of the RV vacationer? Do I really want to buy this? I would love to just rent it for the week. Like that seems lower risk, lower overhead. We'll see if we like it. A trial run type of thing. so if i pause that's where i'm like shoot what else could you rent out so yeah i like that it is amazing with rvs it's almost like a timeshare when you buy it it's like it seems like the best idea ever you know my gosh we're gonna go there all the time and memories and all these things and you realize johnny's got practice and and you got x amount of weeks of vacation a year and and i don't know do we load the rv up just to go away for the weekend and you know is it worth it and And you get your avid RVers.

22:10I mean, heck, we literally full-time RVed for almost five years while we were building this business. We had a blast and we loved the lifestyle. But most Americans, it's like, yeah, it sits there most of the year. You think that full-time RV experience was an asset in having conversations with RV owners? I guess if people are doing it full-time, they don't have the capacity to go and rent it out for extra income. But you were in the space. You knew you could speak the lingo. You know, it was funny. I didn't really spend a lot of time sales and marketing like on the road. We would work hard during the summer with our business, make a really good amount of money, and then we would just travel around all winter.

22:51And so it was kind of like the brain was turned off a little bit. In hindsight, what I've learned about marketing the last couple of years, I'm like, oh my gosh, I could have created so much content and done so much blogging and this and that. I wish I could do that all over again. But yeah, it was really, it was the business model. When I started to duplicate it, that's how I presented it was, I called it the six figure summer. You work your tail off for about five, six months. You have about 20, 25 RVs in your fleet. Do you crush it during the summer? And then you travel during the winter. That's the business model I built because we, we homeschool our four kids.

23:24We love to travel and do life together. And that was the thought when we created it, when we turned it into a biz opportunity that we sold to others as well. Yeah. I admire the ability to turn it off. and say, hey, six-figure summer, had a great season. We'll do it again next year versus, well, what about the fall season? What about if we did six-figure, maybe we could do multi. You have this kind of concept that I call gravy time. How long into the year do you need to work to cover your annual expenses? The average, I want to say, based on a 5 % savings rate is like, people are working to the second week of December before they're like, okay, I've covered my expenses, right?