In 2008, he and two partners, Jonathan Gadish and Benjamin Ninio, were inspired by the rapidly growing car-sharing industry, and the three founded Car2Go Ltd., Israel’s first car-sharing service.
Car sharing is familiar in many U.S. cities such as Cambridge, where Zipcar was founded in 2000 by Robin Chase SM ’86, but the concept was brand-new to Israel. In cities such as Tel Aviv, where parking is scarce and car ownership costs are sky-high, the business soared.
European countries attempted car sharing as far back as the 1970s, but it didn’t really accelerate until wireless technology and rising fuel costs made the option of renting a car by the hour, 24 hours a day, more desirable, Margalit said. But, first, they had to educate the market.
“The average customer is between 24 and 35, highly educated, with an above-average salary,” Margalit noted. “They can afford a car, but they don’t want one, because of the hassle. They can commute to work [on public transportation] but they need a car for occasional use.”
Today, following a word-of-mouth, grassroots marketing strategy, Car2Go has 13,000 subscribers, 180 vehicles and 33 employees. Its brand awareness is more than 75 percent in Tel Aviv. The best thing about it is that it’s easy to use, said Margalit, who does not own a car.
His partner, Ninio, founded an independent systems division known as C2G Logic, a system for managing and tracking shared fleets, which Car2Go now sells to other companies.
Margalit has stepped away from the daily tasks of running Car2Go to attend the MIT Sloan Fellows Program in Innovation and Global Leadership. He wants to learn from others and expand his business. “The Sloan Fellows Program is the perfect platform for me to pursue my goals. With an experienced group of fellows, the learning comes from my classmates as well as from faculty,” he said. Furthermore, “The unmatched cultural diversity at MIT will prepare me for the international business market, as well as enable me to build an international network,” he said.
He’s already picked up new skills in core classes such as Marketing Management (15.809). “It was a course that took all my practical knowledge and gave it a proper conceptual framework that will serve me in the future,” he said.
Margalit plans to expand Car2Go once he graduates in June. “I need to find a game changer. That could be implementing a peer-to-peer car-sharing business model or winning some contracts with municipalities who are interested in operating their own car-sharing service,” he said. Peer-to-peer car sharing is the latest notion in the industry and champions the idea of using social networking to enable car owners to make their own vehicles available for short-term rental in their own neighborhoods.
In the meantime, Margalit will soak up all that he can from the MIT Sloan Fellows program and the Institute, and will spend time exploring New England with his wife, Tamar, and infant son, Jonathan (most likely with a Zipcar membership).