A newly launched motoring fintech, Carmoola, headquartered in London, has just raised £27 million in seed funding. The financing came from Jaguar Land Rover’s investment fund, InMotion Ventures, VentureFriends, BCI and California-based Clocktower Ventures.
Also, the round saw participation from a host of high profile angels that have backed popular companies such as Revolut, Marshmallow, Clearscore and Monzo, including Dan Cobley, the former MD of Google (UK and Ireland). Carmoola will use the proceeds of this round to develop the product and launch the initial stages of the business.
Alex Smout, Principal at InMotion Ventures said, “Up to now car finance has been clunky and intimidating, leaving many feeling frustrated and trapped. Carmoola has reinvented how people pay for cars, focusing on transparency and flexibility to give consumers confidence in the process and access to a greater range of vehicles. We look forward to supporting Aidan and his team as they grow their game-changing approach to purchasing.”
Apostolos Apostolakis, Partner at Venture Friends, added, “Consumer fintech has been driven by improved user experience, but the process for applying for used car finance is opaque and frustrating. Carmoola has transformed the process into a user-centric app that we’re confident will become consumer’s preferred option to finance their next car.”
What does Carmoola do?
It was founded by Aidan Rushby (founder of home rental app Movebubble), Amy McKechnie (Director of Product and Marketing), and Ukrainian co-founders, Roman Sumnikov and Igor Gordiichuk.
As the used car market is the largest retail market in Europe, Carmoola intends to drive the game-changing car finance sector to new heights.
As per reports, in the UK last year, there were 7.5 million car purchases with an average price of £13,705, while the UK market is valued at £120 billion. However, only 19% of consumers use finance for this transaction and a meagre 2% of these transactions happen online, thereby giving a huge potential for Carmoola growth.
“Like many people, I went into it without a clear idea of how much I should spend or could afford.” said Aidan Rushby, Carmoola’s CEO. “You find ‘the one’ and then have to go through this confusing, paperwork-laden and painfully slow process of seeing if you’ll actually be approved for it. The process is broken. Rather than the afterthought, your budget should be the first thing on your list.”
“Although new online car marketplaces have made buying the car easier, they are still using traditional car finance lenders that remain in the dark ages and consumers are paying for this.” continued co-founder Amy McKechnie
Car finance made simple
While there is an interesting fintech revolution going on, car financing seems to have been missed out. With lending secured against the value of the vehicle, which is vetted for accident history, mileage adjustments and outstanding finance, the service gives an extra layer of assurance protecting the consumer.
The London-based startup encourages consumers to rethink the way they pay for a second-hand car, and understand what they can afford first, before beginning their search.
Carmoola motoring fintech platform, which is built on full proprietary technology, would cut out the middleman and give consumers better value, flexible and transparent car finance.
It will give motorists a virtual card. Once they have found the car, they can pay instantly, either online or at any car dealership with the app.
Carmoola is the first fully automated flexible car financing platform. It calculates an affordable budget and an approved credit decision in 60 seconds. Also, it is the only finance company to offer discounts for choosing green cars, such as lower APRs on electric vehicles.