Melbourne startup Spacelli is the latest to enter the growing self-storage market
This year seems to be the year of the self storage startup. First we got Melbourne’s Boxly, then came – and went – Rocket Internet’s SpaceWays, and Boxbird. Now Melbourne startup Spacelli wants to take a stab at the market.
Where the other three startups are in the on-demand storage space, delivering boxes to a customer’s house, picking them up to store, and then delivering them back to the user’s door when requested, Spacelli is more like Airbnb for all your unnecessary stuff. Targeting groups like renovators, leisure travellers, interior designers, and students, it connects users who need somewhere to store their things with users who have that extra space.
Co-founders Nga Nguyen and Geoff Stooke said the inspiration for the platform came from their own experiences being given toys and items from their childhood by their parents that were too precious to throw away but that they had no space to keep.
“Everybody wants to hold onto their cherished items that have important sentimental value way beyond their basic utility. Storage demands are being stretched as we live in a time when density of living is increasing, land sizes are reducing and the cost of living is rising,” Stooke said.
A user looking to store items – a ‘space seeker’ – can either choose to receive quotes from those with space – space traders – or search the platform themselves and making a Space Trader an offer. The users listing spaces can choose to offer packing, pick-up, and delivery services.
Like all startups working in the sharing economy, the concept of Spacelli brings up a number of obvious questions: how can space seekers be sure that their belongings are safe in someone else’s home, and that people aren’t rifling through them? On the flip side, how can the space trader be sure that no dangerous items have been brought into their home? How often can the space seeker come to get one item or another before it becomes annoying? Well, it’s all about trust.
“Spacelli is built on community trust, authenticity and social proofing of all space traders and space seekers. We have multiple points of online verification and we ask space traders to seek references from others to enhance their profile,” Nguyen said.
The startup has $10 million in liability insurance, which covers the activities of Spacelli and the space traders who provide storage services through the platform. It also maintains a customised transit insurance policy that covers the space seekers’ goods while in storage and in transit, for up to $50,000 for any one claim.
“This adherence to risk protection and insurance principles is the backbone of our business model.”
Despite the competition in the space, from traditional storage providers to the on-demand storage startups, Stooke and Nga are not concerned.
“We are a community peer-to-peer storage solution which is very different from the traditional forms of storage offered by others. We don’t see [Spacelli] as a direct competitor. The others are transacting storage via an online medium making efficiencies to a traditional model,” Stooke said.
“Spacelli is somewhat different and has taken a greater paradigm leap with the peer-to-peer model for this market. We’re excited by the challenge and trust in each other and the business model we’re building out.”
The platform is currently onboarding space traders in Melbourne, and is encouraging them to think of themselves as ‘storage entrepreneurs’. When creating a profile, traders are advised to describe the construction of their space, such as whether it is double brick; the occupancy of the space, that is, whether it’s a house or office space occupied only during business hours; the security of the space; and the location or environment of the space. Spacelli has also created communities on the platform for space traders and seekers with similar interests – and in turn perhaps a better understanding of particular items and their storage needs, such as musical or sports equipment – to connect.
As Airbnb and Uber have shown, people are fine with letting strangers into their homes or cars, so there’s no reason why, in theory, Spacelli can’t take off. But it’s not just the fact that the competition exists that Spacelli needs to consider, it’s whether anyone is even really using them all that much: the self storage market is worth an estimated $752 million, but despite Rocket Internet’s deep pockets for marketing purposes, SpaceWays was unable to make a dent in the market and closed up shop after just four months.
Of course, Boxly and Boxbird are still going strong – for now. It remains to be seen how much Spacelli’s space traders charge, but with the other two offering standard box storage for around $8/month, it seems safe to assume that around $5 to $10/month could be the going rate. Boxly and Boxbird also offer the convenience of on-demand pick up and delivery, which Spacelli does not.
With Stooke and Nga finding that demand for space is currently outpacing supply, they will be launching Spacelli over the coming weeks once more space traders come on board. They plan to add new features and expand the service around Australia within the next twelve months, and are currently in discussions with a number of potential partners.