RelayRides buys up car sharing startup Wheelz for the tech

With a still small, but growing, market around people that want to rent out their personal cars to their neighbors, some consolidation seemed inevitable. On Tuesday startup RelayRides, which was one of the first companies to jump into the neighborhood car sharing market, announced that it has acquired Wheelz, a startup that had originally focused on building car sharing communities at universities.

RelayRides says it will acquire, among other things, Wheelz’s DriveBox technology, which enables Wheelz users to unlock and drive away in a rented car, without having to meet with the owner and get a key. Picture it basically like one of Zipcar’s unlocking and verification systems.

When RelayRides launched its business, it used to install this type of unlocking and verification technology in the users’ cars, but the installation process was lengthy and expensive. Later RelayRides started working with GM on connecting this type of system with GM’s Onstar technology. However more recently, RelayRides started opting for manual key swapping as a main option.

RelayRides staunch competitor Getaround launched its service around a box that car owners install in their cars themselves and which renters can use to automatically unlock cars using their smart phone. With Wheelz’s DriveBox tech, RelayRides can get back into the business of making car swapping more automated and easier for customers.

RelayRides has raised $13 million from Google Ventures, August Capital, General Motors, Shasta Ventures, and General Motor Ventures. Wheelz has raised at least $14 million from Zipcar and Detroit-based transportation investors Fontinalis Partners. The companies wouldn’t release terms of the deal.

The market for this type of peer to peer car sharing is still very early. Also execution and making people feel comfortable with the systems is key to growing this industry.