Jonathan Minter investigates how Orto aims to give consumers the experience of enjoying high-end cars without the hassle
As the world moves away from only pure ownership models towards a mix of various ownership and usership models, a number of new business methods have risen. One such model is the newly launched company Orto.
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The idea behind the company is relatively simple: Orto will offer a brand new vehicle valued between £40,000 and £100,000 for two years to potential subscribers.
Four people sign up for the vehicle, and pay an upfront cost and a monthly fee. This gives them access to the car for up to 85 days a year for the two years, including all costs such as insurance and maintenance, at which point the car will be retired from Orto.
Within this there is a set of rules to prevent people from monopolising a car during peak times – all four users are guaranteed the vehicle at least one weekend a month, though users can swap and trade slots if they wish. There’s a rolling limit to how much time can be booked, with a maximum of 50% of days bookable at any one time, and there’s an upper limit of 14 days in terms of the longest booking possible.
The founders
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By GlobalDataThe company was set up by two people: Jules Copeland, who has a history of creating web platforms in the B2B space, and Josh Darling, whose background centres around management consultancy and helping health care organisations plan and set up their businesses. While Copeland has mainly focused on the IT side of the business, Darling has looked after the commercial side.
"The thing that joined us both around all that was an interest in cars," Darling tells Motor Finance.
The two looked at their passion for cars and thought about what worked for them and what did not. Darling says the bits they enjoyed were focused around planning and enjoying a trip away in a prestige car, and learning about an individual vehicle’s characteristics.
However, he says this was not without its downsides, adding: "We looked at the positives alongside the costs incurred, whether the capital outlay, the insurance or maintenance. Then there is the hassle around it – taking the car to be serviced, washed, and it all adds up if you are really busy."
Orto was created as an attempt to keep the parts of the experience Darling and Copeland enjoyed, without the parts they did not.
So far the company has received its seed funding, and recently launched its first proof-of-concept car.
"It’s only now that we’ve got that out there, and it’s got four customers on it, and they’re all really happy, that we’ve considered ourselves arrived at a point where we can say that we’ve created something people like and it looks like it’s going to work," Darling adds.
Opportune time
Darling says the timing has worked out reasonably well, as the company has begun its launch at a time when ideas such as mobility and usership have started to gain real traction in the automotive world.
He says: "When we started on this concept, people would come back and say they wanted to own their car, but these days that rarely comes up."
Darling says that he has seen this shift in attitude really start to accelerate over the previous few years.
While terms such as ‘mobility’ are definitely the current industry buzzwords, Darling says Orto does not fit within this bracket in a traditional sense.
"For me mobility is about transport – I need to get from A to B, and mobility is a holistic way of looking at how I do so, whether by bike, plane, car, or a mixture.
"We have relevance to that, but are interested in the experiential end of engaging in what a car brings you, which goes a bit beyond travel.
"Travel is what you do on a motorway, and the experience is what you do when you take a nice trip away with your friend or partner to the South Downs for a weekend."
As a result, he does not see Orto as a major threat to traditional car finance providers. Instead, the company is targeting a slightly different type of consumer need.
One example provided to demonstrate this is one of the proof-of-concept car customers. This person has recently had a child, and though they still want to use a prestige car, the expense and hassle of owning the car will no longer outweigh the time spent in the vehicle, due to the changed circumstances.
"We help make this a justifiable thing to do," Darling concludes.
Looking ahead, the number of companies providing different options to customers may well increase in, he says, adding: "There will be a plurality of provisions that comes out of it – you’ve got traditional ownership, traditional leasing, hourly car sharing, traditional rental, and different versions of each these and then more coming out of the market.
"Because of the ability of mobile phones to make it easy to access a variety of services, and to build them into your life, it’s not a difficult thing like it used to be."
A recent IBM report, A new relationship – people and cars, which involved a survey of 16,000 people in the US, found that while 86% of people still expected to own a car in the next 10 years, 24% said they would be interested in fractional ownership.
"If you look at that in the context of the multibillion-pound luxury car industry, there’s a really big opportunity to go at this. The challenge is, from a startup point of view, these things take time, and growth is challenging.
"So we have bold plans, but it’s very difficult to be precise," concludes Darling.<
