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Wednesday, June 26, 2013

Try to compete in the business world, get sued by the government

A group of teens turned down opportunities to attend Harvard, Princeton, and MIT to open their own rental car company called FlightCar. Yeah, I know. Crazy, right? But these kids believed their business model was sure to out-compete even the big rental companies like Hertz and Avis, and that's all part of the American dream.

Here's how the business is described on
FlightCar lets people parking rent their vehicles out to other travelers. Every rental is insured up to $1 million, and every renter is pre-screened. Depending on the size and model year of the vehicle, you'll also make up to $10/day in cash! To get free parking, click on "List Your Car". Or, to rent a vehicle, use the menu above.

For owners:
  1. List your car on FlightCar. It's free! FlightCar runs a driving record check on every renter. Regardless of whether it's rented, you're guaranteed free parking for your trip.
  2. On departure day, give us a call 10-15 minutes before you reach the airport, and come to our lot to drop off your car. From there, we'll have a black car drop you off curbside at your terminal of departure or another location within a 10 minute radius.
  3. When you return, call us at 1-866-FLIGHTCAR (354-4482), and we'll send a black car to pick you up at the curb. If you'd like, you can even take a cab, and we'll refund you the fare. We'll even give you a check if your car is rented.
For renters:
  1. Search FlightCar to find a sweet vehicle you'd like to rent! Enter your driver information and you're ready to go.
  2. On arrival day, give us a call at 1-866-FLIGHTCAR (354-4482) when you land. A black car will pick you up right at the curb and take you to our location. A FlightCar team member will meet you there with your rental car.
  3. When your rental period is over, give us a call, and return the vehicle to our location. A FlightCar team member will greet you and help you with your bags. From there, we'll have a black car drop you off anywhere within a 10 minute radius.

The brilliance of this model is its simplicity. No high overhead. No fleet of cars to maintain. Just good service.

And too good to be true, it seems. San Francisco International Airport complained that FlightCar should have to pay the same extortion fees other rental car companies pay. The city is now suing FlightCar claiming that these three teenagers are in violation of California's Unfair Competition Law. Hey, at least they didn't try opening up a lemonade stand.

I will certainly be following this story. It will be interesting to see if it's possible to fight City Hall. If not, these kids will probably be forced out of business and consumers will have one less way to save money. Unfortunately, that's how we stifle the competitive spirit in America.

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