Naspers, through its Naspers Foundry business, has invested R54-million in car subscription company Planet42 as part of a R91-million total funding round alongside existing investors Change Ventures and Startup Wise Guys.
The equity round has been supplemented with R380-million of debt raised from various investors, Naspers said on Tuesday. It is the eighth investment in South Africa made by Naspers Foundry, which the technology giant established to invest in local early-stage technology companies. Existing debt investors, including impact debt fund Lendable, added the larger, debt-funding component of the deal.
Planet42 bridges the lending gap for customers struggling to access traditional vehicle finance.
The company recently opened an operation in Mexico, a country where a high proportion of the population is underbanked
“Planet42 was founded in 2017 and addresses transport inequality by offering an inclusive car subscription service to customers who typically cannot access traditional bank credit,” Naspers said in a statement.
“In emerging markets, including South Africa, vehicle finance — and therefore vehicle ownership — is out of reach for most low- and middle-income earners. This lack of access to reliable, efficient and safe transport can present enduring obstacles, perpetuating inequality and restricting economic mobility. Access to a personal vehicle at an affordable price can be life-changing and a way to level up quickly.
“Planet42’s proprietary scoring algorithms are the foundation from which the company is able to bridge this lending gap responsibly, using a wider range of data sources than traditional credit scores to assess risk in the underbanked customer segment. These algorithms determine a suitable budget for each customer and, based on this, subscribers can choose any new or pre-owned car from Planet42’s network of more than 700 local car dealerships. Planet42 buys the car and rents it out to the customer on a subscription basis. The offering enables customers to either buy or return the car to Planet42 at any time. Of the customers served so far, 89% would have had no other means of gaining access to a personal vehicle.”
Naspers South Africa CEO Phuthi Mahanyele-Dabengwa said the investment in Planet42 “builds on Naspers’s growing mobility portfolio, which includes WhereIsMyTransport, Autotrader and OLX Autos, among others”. Naspers did not say what equity stake it has acquired in the business.
Since its founding in 2017, Planet42 has purchased more than 7 000 cars for people who are unable to access traditional bank credit. The company recently opened an operation in Mexico, a country where a high proportion of the population is underbanked.
The funds raised through the latest equity and debt financing round will be used to expand Planet42’s car inventory in both South Africa and Mexico, “putting the company on track to achieve its ambitious global goal of providing a million cars to people facing transport inequality by 2025”, it said in the statement. — (c) 2021 NewsCentral Media