Raylo, a UK company offering a circular leasing model for smartphones, has raised up to £10 million of debt to fuel its next phase of growth. The financing deal was led by Avellinia Capital, with participation from another specialist lender, Clerville Investment Management. About a year ago, the startup raised £2.9 million in seed funding.
The London-based business offers a sustainable solution to what has become a disposable phone culture. Raylo customers can lease new and refurbished devices for a lower monthly cost. When they want to upgrade to a newer model, the old phone is returned to Raylo for refurbishment and reuse. The company says its Certified Refurbished offering is its fastest growing product category.
“We believe the days of one-trip ownership are coming to an end,” says Karl Gilbert, the startup’s CEO. “Under Raylo’s circular model, devices will be used by a minimum of two people over a lifespan of six to seven years.”
Its circular rental model can supposedly reduce CO2 emissions by 113kg per device and tripling a phone’s lifespan.
“This goes a long way towards reducing overproduction of devices and the estimated 45 million tonnes of annual e-waste caused by good quality tech going prematurely to landfill,” Gilbert added, citing numbers from the Global E-waste Statistics Partnership.
The model is underpinned by a platform that uses open banking data rather than relying on the credit bureaus. The traditional methods used by credit bureaus penalise individuals living in certain postcodes and those with limited credit history.
By using open banking data and making more accurate assessments of an individual’s finances, Raylo says it can enable a wider range of people, from different socio-economic levels, to get a good quality smartphone and the social mobility that comes with it.
For now the new funding will fuel Raylo’s current growth trajectory, with an aim of doubling its subscriber base within the coming months.
Photo: Raylo founders Karl Gilbert, Richard Fulton and Jinden Badesha