Philippine-based lending fintech company OneLot raised $4 M Pre-seed funding

On Monday, OneLot, a fintech company focused on loans and based in the Philippines, announced that 468 Capital-led pre-seed funding round had raised $4 million for the company.

Kaya Founders, Crestone Venture Capital, 21yield, Founders Launchpad, and well-known angel investors are among the other participants, according to a statement from OneLot.

“The company plans to use the latest funding to extend its services to more dealers as well as accelerate product and artificial intelligence (AI) development,” said Tommy Campos, Chief Operating Officer of OneLot.

As per his statement, dealers can enhance their car inventory rapidly by partnering with OneLot, which can result in significant gains in revenue and profitability.

“This is driving our customer retention rate, which exceeds 95 percent,” he added.

Tommy Campos, Subramaniam Srinivasan, and Harm-Julian Schumacher first collaborated in 2021 to develop DART, a grocery delivery app for quick commerce. In 2022, they founded OneLot.

The company’s specialty is providing working capital financing to dealers of used cars only.

Due to its creative methodology, dealers can obtain funding based on a credit line that has already been pre-approved and is established through an AI-powered, data-driven analysis of their company.

Dealers are able to increase their inventory and serve a larger customer base thanks to this financial support, which also helps them become more profitable.

The company has financed over 200 cars, disbursed over $1.3 million in loans since its launch earlier this year, and seen a ten-fold increase in revenue through the second and third quarters of 2024.

The difficulties encountered by Philippine auto dealers are very relatable to co-founder and CEO Harm-Julian Schumacher, who grew up surrounded by his family’s automobile dealership in Germany.

“I experienced firsthand how German financial institutions supported family-run dealerships like ours with a variety of loan solutions throughout the value chain, enabling them to accelerate their growth,” he noted, adding that Germany is a market feature that inspired the OneLot model to empower similar businesses in the Philippines.

It is observed that the Philippines has one of the world’s fastest-growing used car markets right now, driven by strong growth in middle-class demand, rising income levels, and limited public transportation options.

More than 90% of auto transactions in this $8 billion industry are handled by family-run businesses and tiny dealerships.

Three times lower financing rates than in Europe or the US are the result of banks’ limited involvement in dealership and used car financing.

The buy-and-sell cycles of auto dealers are the focus of OneLot’s loan products, which provide an unmatched degree of flexibility and customer-centricity.

They use an AI-enabled underwriting algorithm to process loan applications and distribute funds in a matter of hours.

“We saw the potential of OneLot to address significant problems in the rapidly growing used car market,

“The team combines in-depth knowledge about car dealerships and small and medium-sized enterprise (SME) credit in the Philippines with decades of experience building digital products and AI,” noted Guilherme Steinbruch, Partner at 468 Capital.