UK-based Onto, an all-inclusive electric car subscription service provider, announced on Wednesday that it has raised $60M (approximately €59.17M) in a Series C round of funding. The round was led by London-based Legal & General, a financial services and asset management company.
Existing investors Alfvén & Didrikson, Accelerated Digital Ventures, Cerebrum Tech Limited, and the family office of Jim O’Neill also participated in the round. The Series C brings Onto’s total raised capital to over $330M in equity and debt.
The UK company claims to have grown more than 500 per cent in 2021. The company says that this growth comes despite the global semiconductor chip shortage creating challenges in the industry.
Use of the funds
Onto says it will use the proceeds to consolidate its leadership position in the UK and expand into Europe, starting with Germany in early 2023.
The company already has an office in Germany, led by the recently appointed managing director (for Germany), Joerg Feldheim. He has expertise in the automotive industry for over 20 years and brings extensive international startup, management and transformation experience to help the company grow.
Onto’s CEO and co-founder, Rob Jolly, says, “This funding round is a huge milestone for Onto as it sets us off on our journey to Europe. Germany, a nation with an incredible automotive history as Europe’s biggest car-producing country, is a market with huge potential and a great appetite for electric cars. We’re excited to offer something different.”
“Onto – Europe’s largest electric car subscription service”
Founded in 2017 by Rob Jolly and Dannan O’Meachair, Onto helps motorists join the EV revolution on a subscription basis without huge deposits or a long-term commitment. In the last five years, the company’s all-inclusive car subscription service has proved a hit with consumers – enabling many to move away from the traditional internal combustion engine.
Since 2018, Onto has expanded rapidly, partnering with new charging and electric car providers as more EVs become available to suit all budgets. Currently, it offers 18 models, with subscriptions starting from £489 per month.
In 2020, the company launched Onto for Business. It provides companies with a no-commitment car subscription solution for their employees. Tax benefits can be shared by both parties, and as of now, more than 100 businesses use an Onto for Business subscription with more than 600 automobiles.
Onto’s business model
The company’s business model helps people to sign up for an electric vehicle using a monthly subscription. Public charging, insurance, and breakdown coverage are all included in the subscriptions, and there is no upfront payment or commitment for a lengthy period of time. By giving customers a flexible subscription option, Onto is upending conventional ownership structures.
Onto’s business model taps into three key trends. As a player in the subscription economy, Onto focuses on users over ownership, giving drivers more choice and flexibility around the car they drive.
Also, the company is digitising the complete user journey. Onto is focusing on the ease of the user journey as it helps meet rising customer demand for convenience and ease of use, from signing up and booking a car online to having it delivered to your door in just a few days.
Finally, the raise marks a significant moment for the journey to net-zero as the shift toward carbon-free mobility is accelerating. Coupled with government plans to ban the sale of new petrol and diesel cars by 2030, consumers are increasingly looking for ways to make the switch.