Drover, a London-based startup that bills itself as the European leader in car subscriptions, has raised £20.5 million in funding by a host of investors.
The financing round was led by Target Global, RTP Global and Autotech Ventures, joined by other new investors Channel 4 Ventures and Rider Global, as well as prior backers like Cherry Ventures, bp ventures, Partech, Version One and Forward Partners.
Drover basically offers an end-to-end digital platform for purchasing, financing and insuring cars, upending the traditionally fragmented and dealership-based process.
For one flat monthly payment, Drover customers can get a car with everything included, for a duration of one month to two years, without the need to take on debt. Drover says it can get cars to customer doors in as little as 72 hours, and takes the car back at the end of their term.
The startup says it has managed to deliver record results in its consumer business during a period when traditional car sales had nearly halted completely because of the global pandemic. In May, Drover says it more than doubled the number of new subscriptions sold compared to a year ago – finishing Q2 with a record high in revenue, which it didn’t disclose.
The fresh cash will be used to invest in technology and marketing, and to scale the business across the UK and France.
Felix Leuschner, Drover’s founder and CEO, said: “The car market is one of the last retail categories that has yet to shift online, with online penetration of car sales being still below 1%, while 20% of all UK retail sales are now online. Drover’s digital ‘car-as-a-service’ model is the right approach to truly build the ‘Amazon of Cars’ as it lends itself much better to an online model than does the long-term commitment, high ticket size type transaction of buying a car with cash or on finance. As a result, the last few years have seen Drover evolve and grow into a serious contender in the UK car retailing market.”