Why you should care
Heard of Storage Wars? This is Moving Wars. And Seattle is the battlefield.
It’s the time-honored tradition friends dread, as predictable as the dawn: free labor under the guise of a “moving party.” You know… You come over for pizza and beer, stay for 15 hours, and repeatedly overestimate your ability to carry an entire bookshelf’s worth of books at your advanced age — whether that’s 26 or 44. You might tumble down some stairs. Or maybe just break your friend’s girlfriend’s favorite lamp and get the silent treatment.
Nathanael Nienaber, a trim 35-year-old in blue Buddy Holly glasses that match his checkered shirt, wants to put an end to all that — not to mention that front yard haggling over the cost of a move and guessing games on when your stuff might actually show up. He’s got a moving business, Ghostruck, that gets rid of human interaction entirely, complete with an automated system that lets customers upload photos of their couches, schedule their moves and track their progress.
He and other nerdy entrepreneurs just might be able to pull it off. They’re part of a growing group of new app-driven companies looking to make a dent in today’s $14.5 billion moving industry, which is forecasted to hit $15.5 billion in five years, according to market research firm IBISWorld. Before they pulled up, the only real option had been the do-it-yourself, U-Haul-type national companies, or local two-guys-and-a-truck operations. But in the past four years alone, a flurry of companies have cropped up, offering moving services via app — including Dolly, Wagon, Buddytruk, Burro and Bellhops, each of which offers a slick interface and a lusty promise of hands-clean, back-unbroken convenience. While most businesses declined to reveal their revenue or profits, or didn’t respond for comment, Bellhops says its number of transactions has increased five times year-over-year.
Buddytruk looks almost identical to Uber.
Most ventures like these are aimed at shifting millennials. As U.S. census data show, the old exodus to the suburbs has been flipped in recent years, driven in large part by young professionals fleeing for cool cities. Rhys Green, director of field operations for You Move Me, a sister branch of 1-800-Got-Junk, has noticed that increasingly their customers are renters, living in smaller spaces. At the same time, owning a home has become unviable in booming metropolises. In New York City, the number of homes occupied by renters has increased by 25 percent in 10 years, and in Seattle, only a quarter of millennials own their homes. And more folks are wondering if there’s a better way to move, which is why some are looking for an app to help them out.
Young MBA grads like Nienaber hunt for these kinds of overlooked, pen-and-paper industries, with an eye on “the consumerization of IT” — startup lingo for the creation of tech attuned to address consumer needs. So, for example, movers generally price for three-hour minimum blocks, to ensure they don’t have gaps in their day. Ghostruck, on the other hand, enables professional movers with a free hour here and there to schedule in extra moves, trying to boost both the efficiency and quantity of their jobs, while also adapting to what customers want. Meanwhile, Buddytruk looks almost identical to Uber, except instead of picking you up, someone like Scott Wilson in his red 2009 Ford Expedition arrives to grab your dresser in nine minutes.
As it turns out, the new battlefield for many of these upstarts is in Seattle. It’s a curious place for the disruption of this sector, given that the city has no particular connection to the moving or delivery industries. (Even Dolly’s CEO, Mike Howell, isn’t sure how it happened.) But here’s one reason: Migration of Silicon Valley startups to Seattle is afoot, turning the city into a new, buzzing tech hotbed, chock-full of hungry new talent looking for the next big thing. Oftentimes that involves the use of an app.
Up on a Pioneer Square rooftop overlooking Puget Sound and lined with herbs harvested by the hipster bar downstairs, Nienaber says the idea for Ghostruck struck while he was working for a different kind of moving business, Georgia Pacific, one of the largest shipping companies in the country. That’s when he says he discovered about a quarter of the trucks on the road are completely empty, returning from a drop-off. They’re known as ghost trucks in the biz. Enter Nienaber’s secret algorithm, which assesses the weight and dimensions of an object — say, your boxes of college textbooks or that unwieldy couch you inherited — from a blurry cellphone pic and sets a price the mover can either accept or reject. For his part, Nienaber won’t disclose the details on exactly how it works, or how much in revenue or profits the business is generating. But he says there are patents for the program, and Ghostruck recently managed to raise $2.2 million and has expanded to 12 new cities.
But the delivery of these new businesses might not be as smooth a ride as their founders hope. Dolly, for one, operates in Chicago, but is looking to expand — that is, if it can scale its customer service fast enough, something that Howell admits is a “challenge.” Meanwhile, Ghostruck is courting customers who are willing to pay more — starting at $60 for a single item — for licensed professionals, though there aren’t always a lot of licensed pros available in any given state.
Others, including Dolly and Wagon, offer cheaper services by simply connecting customers with, say, someone who’s got an F-150 and charges as little as $15 for a 15-minute move. And Bellhops’ movers are simply college kids working part time, usually for other students, so they provide the help but no truck. No wonder some think a shaking out in this industry may be on the horizon. Ask the CEOs and they have a couple of ideas: Nienaber sees only two or three startups surviving, while Howell predicts a “winner takes all” scenario. Which could spell the end of moving parties.