Companies that need scientific instruments, especially on a temporary basis, but can’t afford pricey new equipment often end up buying used. Little do most of them know that another option is renting.
Kwipped, a new online rental market, hopes to change that with its aggressive search engine advertising, e-mail outreach to scientific instrument users, and what it hopes will be a sort of centralized rental mall. Kwipped is going up against other, more experienced, competitors, but it is also counting on reaching new customers intimidated by or unfamiliar with the fragmented rental market.
Up and running for a year and a half, the firm acts as an intermediary between potential renters and instrument suppliers. Robin Salter, Kwipped’s chief marketing officer, calls his firm an “Uber for the equipment space,” referring to the phone app that hooks up drivers with customers who need a ride.
Like Uber, Kwipped connects manufacturers and refurbishers with prospective renters of electronics testing, environmental testing, medical, and even heavy construction equipment. Kwipped’s staff directs inquiries to potential suppliers, who submit bids that are then passed back to renters.
Although Kwipped can make rental arrangements for a variety of equipment, laboratory equipment has been the firm’s most active category, Salter says. The bulk of inquiries, many about renting for less than a year, come from contract and clinical research organizations in the pharmaceutical industry, he says.
Lab operators often have short-term needs, Salter explains, and even though they may find it hard to justify an expensive purchase, they want the latest scientific equipment. Rentals can provide that access at a reasonable cost that often can be passed on to clients as a project expense. Research contracts seldom provide for the purchase of new equipment, he says.
Wallis Blumm, project management vice president at Innovis, a clinical development consulting firm, says that was the reason she helped arrange a freezer rental through Kwipped. Her client, the operator of a clinical research site, didn’t want to invest in a freezer needed for just one short-term project, but the study sponsors would pay for the rental, she says.
“Most of the sites we work with have all the equipment required for a clinical study,” Blumm says. “In this case, one site was missing a freezer.” Kwipped, she says, saved her the trouble of calling a variety of suppliers for quotes because it acted as a clearinghouse.
The web-based market operated by Kwipped has opened a new outlet for some equipment makers. “We never rented until Kwipped contacted us,” says Amanda Moroney, marketing coordinator for the medical division of Seiler Instruments, a maker of dental and medical microscopes.
“They handle everything,” Moroney says. “They arrange for billing, and payment is direct-deposited into our account,” she says. Once terms are agreed to, “we ship out and provide a return label. That’s it.”
The web marketplace has also attracted customers Seiler never would have reached through its traditional distributor network. In one case, producers of a crime investigation TV show rented a Seiler instrument for a scene’s backdrop, Moroney says.
Some refurbished equipment sales and rental outlets say their inventory and customer service gives them an edge over Kwipped, which has no inventory and is a middleman. “We have trained scientists and chemists here who refurbish, install, and service the equipment we rent and sell,” says Mike Piccirillo, development manager of GenTech Scientific. “Nothing leaves our facility unless it’s tested.”
Through its website, GenTech offers a number of refurbished liquid and gas chromatography and mass spectrometry instruments for rent from makers including Thermo Fisher Scientific, AB Sciex, and Agilent Technologies. Academic institutions as well as contract manufacturers and clinical trial labs are among GenTech’s rental customers.
The company, which has been in business for 20 years, offers quotes via the web, but customers will also call or e-mail inquiries. “We’ll call customers to flesh out the quote,” Piccirillo says. “This is a service business. We want to make sure we understand what our customers are looking for.” Ultimately, he adds, “our goal is to get equipment into our customers’ labs and hope they fall in love with it and want to keep it.”
Kwipped’s Salter says most of the lab equipment suppliers he has worked with are refurbishing firms that want to start or extend a rental business and calibration specialists that have a few pieces of equipment to rent. Salter says he hopes to interest more instrument makers such as Seiler to rent through Kwipped.
Some large lab equipment makers, such as Thermo Fisher and Agilent, have their own financing programs focused on long-term leasing. Others work with equipment financing organizations like Navitas Credit, which says it has rent and lease programs available through about 80% of the instrumentation industry’s biggest firms.
The bulk of instrument rentals Navitas arranges are with “Fortune 2000-type firms,” says Dean Stolberg, the firm’s national accounts vice president. Sometimes the rentals are an interim arrangement “between budget cycles” before the purchase of equipment, he says.
Contract research labs are another significant rental market for Navitas, Stolberg says. Venture-backed drug discovery firms that want to conserve cash and that “would not qualify for traditional financing” can also find financing opportunities through Navitas, Stolberg says.
Renting is an unfamiliar option in the science start-up community, says Wayne Barz, who has worked with start-up firms, many in chemistry and life sciences, for more than 15 years at the Ben Franklin TechVentures business incubator in Bethlehem, Pa. Many firms access sophisticated equipment through relationships they have with a research university. Where start-ups need their own equipment, “most try to buy used,” he says.
“I am unfamiliar with any start-ups that have rented equipment,” Barz says. But if they knew about the option, “I would bet there’d be interest,” he adds.
“Awareness is a challenge for us,” Kwipped’s Salter admits. But traffic is increasing on Kwipped’s website, and “we’re seeing a high customer return rate,” he says. “We want to make renting a viable option.”