Zipcar Inc. began in Cambridge, Mass., with a single lime-green Volkswagen Beetle. Since 2000, it has grown into a fleet of more than 8,000 cars in cities including Chicago, Los Angeles, New York, London and Toronto. Today the company boasts 500,000 car-sharing members.
Now Zipcar is moving forward with an initial public offering worth as much as $75 million, analysts say. In June, the company filed with the Securities and Exchange Commission to become publicly traded. Zipcar declined to comment on timing of the IPO.
The company reported revenue of $131.2 million in 2009. In the first six months of 2010, it reported $79 million. But Zipcar has yet to turn a profit, incurring net losses of $4.7 million in 2009 and $10.5 million halfway through this year.
Zipcar -- which is available in 50 cities in the United States, Canada and the United Kingdom and on 150 college campuses -- lets people use vehicles when they need them. The Zipcar fleet features more than 30 makes and models, including hybrids and pickups.
Neil Abrams, president of Abrams Consulting Group Inc. in New York, said selling the concept of "sharing" to investors could be tricky.
"This is a mind-set, and that's what a lot of people don't understand," said Abrams, who advises rental and car sharing companies. "It's a movement, a community."
How does Zipcar plan to monetize a movement? Jim Hall, managing director of 2953 Analytics in suburban Detroit, said Zipcar's expansion plan is capital-intensive, but its product has potential.
"It's the idea of focused mobility when and where I need it," he said. "That's where the real market opportunity is."
Hall said Zipcar is not entirely part of the green movement because most of its vehicles are not hybrid or electric. He said this could reduce the investment appeal of the company.
"Zipcar is still using gasoline-powered cars, and for some green investors that may not be good enough for them," he said. "The question is, is Zipcar green enough for those people, or do they want the moon shot?"