Why buy an expensive textbook when you could rent it for a lot less? Selling back books at school bookstores has become a joke ($5 for a $150 book?! I’d rather burn it than take that markdown.) but BookRenter is here to help. According to the New York Times, BookRenter has partnered with 75 college bookstores around the U.S. It also made the announcement that it’s raised about $10 million in venture capital from Norwest Venture Partners and previous investors. Not too shabby.
BookRenter is in a heated battle with Chegg, another book renting service. This is the first time that school bookstores have actually changed their approach and decided to rent books rather than purely sell them.
BookRenter and Chegg are in head-to-head competition, but with different business models. Chegg has raised $146 million and operates a warehouse in Kentucky, near the U.P.S., from which it mails books. BookRenter has raised $16 million and does not hold its own inventory, but instead contracts with Amazon.com and several other booksellers to fulfill customer orders.
“Education is going through a massive transformation,” said Mehdi Maghsoodnia, chief executive of BookRenter. “Renting textbooks is what iTunes was to music. It’s unraveling the economics.”
College bookstores can use BookRenter to set up their own Web sites, branded with the college’s name, and BookRenter does all the behind-the-scenes work. BookRenter and the bookstores share the revenue. Students can receive the books by mail or walk to the campus bookstore to pick them up.
The 75 colleges that have partnered with BookRenter include University of Texas at Austin, University of San Diego and North Carolina State University.
Mr. Maghsoodnia said that makes a difference. BookRenter’s message to college bookstores, he said, is, “We’re not stealing your customers, we’re partnering with you to give them a more affordable option.” He added, “That’s a much different model.”
BookRenter determines which textbooks will be in demand each semester, as professors update their reading lists, by monitoring sites like Amazon.com to see which books are being bought and sold.
At BookRenter, renting a new book costs half as much as buying it, and renting a used book costs 75 percent less, plus the price of shipping, Mr. Maghsoodnia said.
-Portions from The New York Times