Investors pour $175m into EV subscription service
Onto, the UK electric car subscription platform, has raised $175m in a Series B funding round as it looks to grow its sustainable ‘car-as-a-service’ model.
Tapping into the rise of subscription services and demand for greener vehicles, Onto leases cars for a monthly price that includes 1,000 miles, insurance, service, repair and free access to 11,000 EV charge points.
The company said it hopes to change what it sees as a lack of flexibility and high costs associated with EV ownership, which it argued is making the transition to EVs “expensive and daunting”.
Led by Swedish VC firm Alfvén & Didrikson, the latest funding round brings Onto’s total funding to $245m. Other investors included ADV, Cerebrum Tech Limited and JamJar, while Pollen Street Capital provided a senior-secured asset backed debt facility.
Onto said the new equity will enable it to embark on the next phase of rapid growth through an expansion of its fleet and by opening in new markets. Last year, the company introduced a subscription service for businesses, which it said more than 300 companies now use.
Rob Jolly, CEO at Onto, said: “While two out of three UK drivers want their next car to be electric, the transition can be expensive and daunting.
“At Onto we’ve been changing the rules of the game for car ownership through our no-commitment, all-inclusive subscription service. Our focus is on providing an easy, flexible and affordable alternative, and we’re seeing huge demand.”
Onto’s fleet includes 16 models, ranging from a Volkswagen e-Up for £339 per month to a Jaguar I-PACE for £1,299 per month.
A price comparison with other leasing models on Onto’s website suggests that the amount drivers can save by using the service varies considerably. The VW, for example, saves drivers £210 per month – a 38% saving compared to leasing elsewhere – while the Jaguar saves users just £49 – or 3.6% . However, the company emphasises that it does not ask for a deposit and offers monthly flexibility, whereas competitors often provide leases of at least 24 months
Tiyam Afshari, partner at Alfven & Didrikson, said: “We are thrilled to partner with Rob and the rest of the Onto team in their endeavours to accelerate the electrification of cars, reduce emissions and lower the threshold for anyone to drive an EV.
“We are big believers in the transition from car ownership to car subscription and look forward to an exciting journey together, transforming an industry and ultimately contributing to a positive change for society.”