Kyte's Downfall: The Shocking End of a Hertz Rival and What It Means for the Rental Industry

The Rise and Fall of Kyte

Kyte, a startup that once boldly claimed to be the 'best competitor to Hertz', has officially shut down. The company, which specialized in on-demand rental cars delivered to customers' homes, entered into receivership after selling its customer list to Turo. This marks a dramatic end for a company that had expanded to 14 markets and raised over $300 million in financing.

Image Credits: Kyte

What Went Wrong?

Kyte's troubles began in 2024, when it struggled to generate free cash flow in key markets like Atlanta, Chicago, Boston, and Washington, D.C. The company slashed staff and exited most of its U.S. cities, focusing solely on San Francisco and New York City. Despite efforts to secure financing and explore a sale, Kyte's board ultimately voted to wind down the company.

The Aftermath

Customers who had prebooked trips are now stuck waiting for refunds, with some resorting to charge-backs through their credit card companies. Kyte's CEO, Nikolaus Volk, suggested that charge-backs might be the quickest way for customers to recover their money.

A Troubled Sector

Kyte isn't the only startup in the vehicle rental sector to face challenges. Getaround shut down its U.S. operations earlier this year to focus on Europe, while Autonomy, founded by TrueCar's Scott Painter, pivoted away from vehicle subscriptions after similar struggles.

Key Takeaways

• Kyte controlled its own fleet, differentiating it from peer-to-peer services like Turo.
• The company's inability to sustain cash flow in multiple markets led to its downfall.
• Customers are facing difficulties obtaining refunds, highlighting the risks of prebooking with startups.