South African car subscription service Planet42 secured $30 million in equity ($6m) and debt ($24m) financing. Debt venture fund Lendable doubled its initial $10 million financing it issued in early December.
The car subscription model caters to private individuals who can’t access financing through South African banks.
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Naspers Foundry led the equity round and was supported by Change Ventures and Startup Wise Guys. All the investors participated in the 2020 seed round.
“Our car subscription is socially inclusive. For us, the differentiating factor is our customers would not have a car without us,” says CEO and co-founder Eerik Oja.
Planet42 buys second-hand cars, which lowers the unit compared to a subscription model that purchases new cars. This bridge round – preceding a 2022 series A investment round – will power the company’s expansion into Mexico.
Customers can find suitable cars using Planet42’s tools, which includes its proprietary algorithms, from the over 700 dealers in the network. The company then buys the car and rents it to the customer.
Mexico presents a larger addressable market with a high percentage of citizens dealing in cash transactions and an average of seven million used cars trading owners annually.
Planet42 wants to purchase one million cars through its business by 2025. It has already delivered 5 000 in 2021.
Featured image supplied by Planet42