Dozr Inc., which has developed an online heavy equipment marketplace, has closed a $2.5 million equity financing round from FairVentures Inc., the innovation initiative of Fairfax Financial Holdings Ltd. 

As part of the deal, Toronto-based Fairfax subsidiary Federated Insurance Company of Canada has developed an insurance coverage plan built into Kitchener-based Dozr so equipment owners will be protected when people rent their machinery.

Dozr is now the first company in the heavy equipment market to provide insurance as part of the platform. Other companies in the space require contractors to provide their own insurance, and often those policies don’t cover another party renting the equipment, which leaves owners at risk.

Dozr is an online peer-to-peer marketplace in which a contractor needing a certain piece of equipment can rent it from another contractor, who’s not using it at the time. The two parties agree on the price and Dozr gets a commission.

As well as providing the platform, Dozr helps the parties by providing contracts that nail down the length and terms of the rental, and taking care of the payment process. There is also a rating system so customers can see evaluations of people on both sides of the transaction.

Founded by the family team of brothers Tim and Kevin Forestell and Erin Stephenson (Kevin’s wife), Dozr has grown quickly since its founding in June 2015. It has gone through the Google for Entrepreneurs and Communitech Rev programs. Earlier this year, it won the Rev Centre Stage competition. And now has more than 2,200 customers across Canada, representing over $200 million worth of equipment. With the investment from FairVentures, Forestell plans to expand operations into the United States.

“Now we can give equipment owners comfort that they are protected if something goes wrong while someone is using their equipment,” said Kevin Forestell. “Until now, they just had to keep their fingers crossed because no one else offered insurance, and it was nearly impossible to get through a broker.”

Not only does Dozr create revenue for equipment owners, rates on the contractor-to-contractor platform tend to be about 40 percent less than retail rental rates and the variety of equipment is greater. Dozr offers both construction and agricultural equipment and is free to join.

“We are very pleased for FairVentures to partner with Kevin and the entire entrepreneurial Dozr team to deliver their innovative new service in Canada and globally,” said Paul Rivett, President of Fairfax. “Dozr is a great new Canadian innovator that is transforming the heavy machinery industry, with an outstanding equipment sharing platform developed by Kevin’s team.”

Dozr is based in the Communitech startup hub in Kitchener, Ontario. Dozr recently took home the top prize at the demo day for Communitech Rev, the accelerator’s program for product-ready startups focused on sales and marketing.