Technology Rental Plans Emerge As Affordable Business Option

The growth of remote work in recent years has accelerated the tendency for more flexible company structures that embrace digital technology and decentralized organization.

Alongside this trend, businesses are adapting their approach to procurement and ownership, with demand for rental and subscription models matching the new focus on flexibility and agility.

Sam Selldorff, vice president of B2B at German rent-a-tech firm Grover, told PYMNTS in an interview that like consumers, businesses are increasingly attracted to the value that tech rental offers, including a more flexible, more sustainable and often cheaper alternative to outright buying expensive products.

Businesses are “moving away from an office-centered structure [and focusing] more on digitalization within the organization, and both of those things mean that you need new tech and new ways of working,” Selldorff explained.

As a result of this, IT and business leaders are rethinking hardware procurement, and the strategy of purchasing new tech equipment every few years no longer makes business sense.

And as businesses adapt to remote employment and more agile operations, using the “Device-as-a-Service” model gives them more flexibility to scale geographically and means they can move to equip employees with the technology they need as and when it suits them.

Another key change businesses have witnessed is that device life cycles are shorter than they were in the past. For example, whereas the typical upgrade cycle for laptops was once three to five years, many companies now update devices every one to two years.

Selldorff said this is partly to do with the pace of hardware innovation but also an inevitable consequence of digital transformation as employees use their devices more in their day-to-day work.

Consequently, this fast-paced asset refresh cycle of modern businesses makes owning many devices increasingly unsustainable, both from a financial and an environmental perspective.

Echoing comments Grover Chief Financial Officer Thomas Antonioli made to PYMNTS earlier this year, Selldorff said she considers the two different types of efficiency as completely related.

“Not only do we improve the sustainability of devices’ lives, we also help these businesses be more efficient in their spend,” she said.

Read more: Grover CFO Says Rent-a-Tech Accelerates Shift to Circular, Sustainable Economy

Beyond Office Electronics

Although laptops, phones and monitors are oftentimes the most in demand from a range of over 5,000 odd products, Selldorff said Grover is seeing growing demand in other categories, such as virtual reality (VR) goggles and eMobility vehicles, which businesses are increasingly renting for their staff.

These two emerging trends, she added, point to the way that companies are “thinking creatively about how they can use tech to both deliver on their business objectives, but also employee benefits.”

On the Grover side, thinking creatively will involve exploring what Selldorff referred to as “non-physical subscriptions” as part of a newly launched software platform, Grover Business Premium, marking the company’s first foray into the enterprise Software-as-a-Service (SaaS) market.

With non-physical subscriptions, Grover is moving beyond simply providing insured devices to offering additional products and services, such as the associated software that comes alongside certain devices, as well as a range of data and management services that clients can access through the online portal.

With the SaaS platform, companies have a full view of what’s going on in their business, and this, according to Selldorff, has led to engagement skyrocketing as clients gain insights into how their rented technology is being used by employees.

Another upside of this, she continued, is that Grover also gains a lot of valuable data to help it better understand its clients’ needs and inform how it develops new services.

Eyes on the US

On the growth front, in addition to expanding its range of services, Grover is also using a $260 million debt facility it recently secured to further its expansion in the United States market.

See more: Grover Agrees to $260M Debt Financing Facility With M&G

There, Selldorff said the startup culture is especially open to new ideas and alternative financial models, presenting a huge opportunity for the tech rental business.

She insisted, however, that “a startup in Europe and a startup in the U.S. think very similarly,” it’s more the older institutions that have been slow in coming around to the subscription rental model.

Read more: After Explosive European Growth, Grover Brings Tech Rental Service to US

Yet even among legacy enterprises, Grover is beginning to see traction. Pointing to examples such as medical companies that need iPads for patients’ rooms and a growing demand for laptops and tablets in the education sector, Selldorff said, “we really have an open door with the types of companies we [can] work with.”

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