$100 M equity & debt funding received by SA car subscription startup Planet42
To help it speed its growth, the South African company Planet42 has acquired US $100 million in combined equity and debt capital. Planet42 is a car subscription platform that addresses mobility inequality by placing automobiles in the hands of those who cannot access traditional bank credit.
In order to provide access to a personal automobile to its mostly underbanked customer, Planet42, which was first introduced as CarGet in 2017, collaborates with dealerships all throughout South Africa.
The startup processes customer applications using an automated scoring system based on the credit bureau, affordability, and alternative data. After reviewing the customer’s validation documents, if the application is granted, Planet42 will buy the vehicle from the dealership and rent it to the applicant. The asset is protected by tracking technology, mechanical insurance, and other insurance policies.
In February 2021, Planet42 completed a US $30 million debt and equity fundraising round; as of now, it has obtained a further US $100 million in debt and equity investment.
Rivonia Road Capital, along with other current and new investors, participated in the US $15 million equity round that was jointly led by Naspers and ARS Holdings. Rivonia Road Capital also offered a US $75 million credit facility. An additional US $10 million in debt funding came from private investors. With the money, Planet42 will be able to expand its business quickly and realize its goal of offering one million automobiles globally.
The firm has nearly doubled in size since its previous investment in 2021, and in the past year alone, the company has bought over 5,000 automobiles in South Africa. The Planet42 network now includes around 1,000 dealerships. With over 250 automobiles now delivered to consumers, the venture recently started in Mexico after the South African business model proved successful there.
“Planet42 is committed to breaking down the barriers that South Africans face in accessing cars. The struggle for credit, particularly for car finance, has been an ongoing challenge for millions of people in the country, even a decade ago, when the economy was arguably in better shape, and we understand the significant impact that this has on people’s lives. Essentially, no car equals lower standards of living and, in many cases, no income at all. Our mission is to empower people to create a brighter future for themselves, and we are proud to be a part of their journey towards financial inclusion and success,” said Grant Wing, South Africa managing director and country manager of Planet42.
“I’m thrilled to support Planet42 as they expand worldwide and improve the lives of thousands of individuals who face limited access to private transportation, which can significantly impact their quality of life and opportunities. Planet42’s team has displayed remarkable execution, with a proven innovative, cash-generating, and globally scalable model,” said Andrew Rolfe, general partner at ARS Holdings, who joins Planet42 as a member of its supervisory board.
