These friends started a yacht rental service during the pandemic, and business is booming
In June of 2020, Jeffrey Nham, an entrepreneur, rented a small yacht for a day trip out on Lake Ontario with friends. He soon discovered a growing demand for boat rental services, and partnered with his friend Issey Abraha, a communications professional. They started an Airbnb-like service for yacht rentals with a fleet of four boats rented out at $1,000 per hour. Here’s how their business came together.
Jeffrey: Issey and I met as part-time background actors when we were in high school. We worked on movies like Carrie starring Chloë Grace Moretz. After graduation, I studied economics and marketing at Ryerson and started working in events. I also ran an Airbnb business, managing a few rental properties downtown.
Issey: I studied journalism at Humber, then found corporate jobs in communications for charities. I also worked as an aide and advisor to Jagmeet Singh and his brother, Gurratan, an MPP in Brampton. In May of 2019, I was at a Raptors game with Jagmeet and seated next to a guy named Paul, who I became friends with and who invited me to come on his rented two-storey, 60-foot yacht.
Jeffrey: During the pandemic, events were cancelled and the Airbnbs I used to manage shut down. I was sitting at home collecting CERB cheques and living off my savings. In the summer, I started seeing people like Issey post on Instagram about taking yachts out for the day. I wanted to take a few friends out, too, but there weren’t a lot of options. All the available companies were fully booked up. Eventually, I just started DMing people on Instagram who I saw on boats. An events promoter connected me to a yacht owner, who agreed to rent his yacht to me. On a Friday afternoon, I got a group of 10 friends together and we went out to Toronto Islands and docked at the mooring wall at Hanlan’s Point. It cost $4,000 for about six hours.
It felt so good to be out on the water and in the fresh air. That week, I realized I could make a business out of it, connecting boat owners to people who wanted to rent them, like an Airbnb for yachts. I shared my idea with the captain of the boat I had rented, and he agreed. I’d get 15 to 20 per cent of the contract amount as commission. A few days later, I started an Instagram account, GTA Yachts, and ran ads. People started DMing me right away. My first charter paid about $3,000 for a six-hour rental. Things snowballed really quickly. I started getting 10 or 20 DMs a day and was booking a couple rentals a week; then 100 messages a day; then 200 messages a day. I was booking about 10 rentals a week and quickly realized that I need more boats to meet the overwhelming demand. I’d seen Issey post about his yacht trips, so I messaged him for a contact and gave him a few hundred bucks as a commission.
Issey: At first I thought Jeffrey was booking a private party for his friends. But then he booked four rentals in one week, and I knew there was something more. My friend Paul had rented the luxury yacht every Saturday before the pandemic, so I knew how profitable a boat rental business could be. I reached out to Jeffery, and we decided to partner together. I’d help him find new captains and boat owners. At first, I was sneaking into the marinas, talking to the owners who had commercial licences and telling them they could make good money renting their boats out to us. By the end of that summer, in September of 2020, we had 20 boat owners on board, and we were booking about 30 rentals a week. We put in $20,000 to $30,000 from our savings for marketing and advertising in our first season.
Jeffrey: We rent by the size of the boat and by the hour. The price ranges from $750 an hour on weekdays to $1,000 an hour on the weekends, depending on the boat you rent and when you rent it, and we have a four-hour rental minimum. Over the winter, we paused our rentals and thought about how to expand the business further next year. We realized that the biggest demand was for boats over 60 feet that could host up to 12 people. But most of the boats we had partnered with were 30 to 50 feet. We needed a new plan, so we connected with a yacht owner who saw potential in our business model and agreed to invest in the business. He bought three 60-foot yachts, each over $750,000. Our fleet consists of a 66-foot Azimut, 65-foot Meridian and a 40-foot Sea Ray 400 Sedan Bridge. Each boat is two storeys and they have spacious sundecks for tanning, bluetooth sound systems and barbecues on-board.
Issey: In November of 2020, I was laid off from my job as a communications specialist. I had a good season working alongside Jeff, so I decided to go all-in on the yacht business. We renamed the company UD Yachts, which stands for “Ur Dream Yachts.” Now that we were running our own fleet of boats, we knew we’d need a dedicated pick-up point to streamline the process. We reached out to the city asking about available spots. There was a location available at Polson Pier, and we signed an exclusive agreement with them to be the only boating company that could do pickups and drop-offs at their mooring wall.
Jeffrey: The agreement with Polson Pier started in May of 2021. But the city was still under lockdown. So, when the season started, we could only take out small groups.
Issey: I was worried. We had already made a lot of bookings for groups of 10 to 12 people in May and June that we had to cancel. We were losing money.
Jeffrey: In mid-July, the city entered Stage Three and we hit the water running. By the end of the month, we were so booked up with our three boats that we subcontracted a fourth boat from another owner to help with overflow clients. We had every boat out on the water for eight hours on weekdays and 12 hours on weekends. We hired about 10 employees: a captain, a first mate and host, as well as a security guard for our mooring wall and additional admin workers.
Issey: All kinds of people rent our boats. We’ll have a family out for Sunday brunch. Or a group of 20-somethings having a birthday party. We’ve also booked bachelorette parties and gender reveals. Most people find us through Instagram, but we also get a lot of clients through Facebook and our website. On board, people drink once the boat is anchored, but they don’t get too wild. Our captains keep pretty good control. We have to make sure people are safe. We haven’t heard any wild stories from our crew yet.
It has been extremely busy out on the water, though. Everyone was out boating this summer. On the weekends, the lake was completely packed with boats. There is a huge demand from people looking to get on boats and have a good time. Everyone who steps off our boats is so happy. They tell us that they can’t wait to do it again. We’ve had a lot of repeat customers this summer. When August rolled around and people started venturing back to clubs and bars, I was worried about how it’d affect our business. But, we had nothing to worry about. We were still fully booked through the end of the summer. We’ll wrap our season in early October this year.
Jeffrey: Initially, I thought this would just be a way to make some money on the side. But this has been our full-time job for the past two years. We’re in this for the long haul. The season is winding down now, but we’re plan to buy more boats for next year and to continue growing the business.
Issey: We’re also hoping to set up a photo wall and other amenities at our docking location to make it feel like a VIP experience all the way through. We want to make it exciting for customers so they keep coming back. The potential in this city is huge.
Jeffrey: The boating industry in Toronto is in its infancy, when you look at other cities like Miami, New York and others out in Asia. Even though we have a shorter summer, it just makes the season that much more precious. Covid kick-started many peoples’ interest in boating and that won’t go away once the pandemic is over.
An earlier version of this post misstated when Issey Abraha and Jeffery Nham put their savings into the business. This has been updated.