An umbrella-sharing startup unintentionally gave away 300,000 free umbrellas

Within the first few weeks of launching, a Chinese umbrella-sharing startup has lost nearly its entire supply of umbrellas due to people hoarding their rented rain protectors.

Across 11 cities, approximately 300,000 umbrellas in Sharing E Umbrella's inventory have been taken out of circulation, according to the South China Morning Post.

"Umbrellas are different from bicycles," company Founder and CEO Zhao Shuping told the SCMP. "Bikes can be parked anywhere, but with an umbrella you need railings or a fence to hang it on."

Shuping began the company after noticing the global success of bike-sharing programs. And since people always seem to be without an umbrella when a rainstorm strikes, he figured a similar model could work, so long as people put the umbrellas back once the weather cleared up.

Instead, Shuping found the $1.5-million-backed company has mostly handed out free umbrellas to people in need. After paying the $2.79 deposit, most users have simply kept the umbrella for themselves. Sharing E Umbrella has no way to track where each umbrella went.

Chinese companies have run into challenges with the sharing models before. In June, the bike-sharing startup Wukong Bicycles had to close down because 90% of its bikes went missing. Like Sharing E Umbrella, the company had no way to track the bikes' location.

"The startup is closed now," company founder Lei Houyi told Shanghaiist. "I'll think of it as a charity project."

As for Sharing E Umbrella, Shuping said he plans to release an additional 30 million umbrellas by the end of the year. He'll spend the upcoming months devising a way to add GPS into the umbrella rental process so he can avoid the headache a second time.