Online car shopping and delivery platform Canada Drives said Thursday it has closed another $10 million (CAD) in equity funding from existing strategic investors. This follows a $40 million funding round in June from goeasy Ltd.
Canada Drives, which has expanded from British Columbia to Ontario, Alberta and Saskatchewan since launching its platform in 2020, said the new funding will help it expand its market count further.
“Since launching, we've built trust with thousands of Canadians who have sold and bought cars through Canada Drives. We continue to deliver best-in-class service with our transparent and streamlined offering, and remain the industry leader in the online auto-retailing space,” Canada Drives co-CEO Cody Green said in a news release.
“With these new funds, we now have our sights set on expanding further across the country to give Canadians coast-to-coast the ability to buy and sell their cars completely online,” Green said.
He added: “Our strategic partners have seen how quickly we reached per unit profitability earlier this year and the continued progress since then. We’re grateful to have strong strategic partners who understand our business and the scalability of our offering to Canadians.”
Canada Drives is eyeing growth in other provinces and now has more financial resources to accomplish that objective.
Last week, the online vehicle shopping and to-your-door delivery platform, announced the close of $40 million CAD in equity funding from Canadian company goeasy, one of Canada’s leading non-prime consumer lenders.
With the company operational in British Columbia, Alberta, Ontario and most recently in Saskatchewan, Canada Drives said in a news release that the funding will be used to expand into new provincial markets, grow the available inventory and enhance its digital platform.
As part of the investment, Canada Drives and goeasy will partner to further integrate automotive financing into the online buying experience. This initiative supports Canada Drives’ mission to be the easiest place to buy or sell a car in Canada and to make car shopping fair, transparent, and accessible to all Canadians.
“The investment led by goeasy further positions Canada Drives as the industry leader in the Canadian automotive e-commerce market. The new capital, alongside the strategic partnership, will enable us to grow our available inventory, enhance our market-leading service, and continue to expand across the country,” Canada Drives co-chief executive officer Cody Green said in the news release.
“Our customers will always be our top priority, and our growth is focused on how we can best serve Canadians from coast to coast,” Green added.
The funding round comes on the heels of the company’s expansion into Saskatchewan and the launch of the fully automated “Sell My Car” feature in May.
With the new capital, Canada Drives will also aim to double the amount of certified used vehicles available in existing markets and the team to support its ambitious growth plans.
“Canada Drives has established themselves as the market leader in online car retailing, sharing our common vision for a seamless customer experience,” goeasy’s president and chief executive officer Jason Mullins said. “Since launching their online car retailing platform in late 2020, thousands of Canadians are choosing Canada Drives to purchase their next vehicle.
“We look forward to helping finance their consumers’ automotive purchases and are proud to invest in the business as they aim to develop an industry leading online car shopping experience, all from the comfort of home,” Mullins went on to say.
Canada Drives is now available to more than 25 million Canadians and has experienced a significant growth in sales, with a 580% increase over the past year, following a $100 million CAD fundraising completed in early 2021.
For more information, visit canadadrives.ca.
PowerBand Solutions, which is an Ontario-based trading and financing tech platform in the digital retail and fintech space, said this week it has secured a $20 million (USD) private placement through an entity controlled by J. Bryan Hunt Jr., and JPK Capital. The latter is an investment vehicle owned by Joe Poulin.
Once the private placement closes, Hunt will become chairman of the PowerBand board of directors and Poulin will become vice chairman.
Darrin Swenson is the incoming president and chief executive officer, as it was recently announced that Kelly Jennings was stepping aside from his post (more details from PowerBand here).
On its website, PowerBand describes itself as a “technology provider that is developing solutions for automotive and other industries that drive efficiency and transparency in the marketplace.”
It launched a Drivrz solution suite in March that includes three vertically integrated solutions: DrivrzLane (an end-to-end omnichannel tool for online car sales from dealers), DrivrzXchange (a consumer-focused online used-car marketplace that includes participation from dealers) and DrivrzFinancial (an auto fintech platform focusing on used-vehicle and electric-vehicle leasing), the company said on its site.
“We are excited to announce the next phase of growth at PowerBand — attracting a generational automotive family like the Hunt Family and an experienced technology entrepreneur like Mr. Poulin reflect the quality and reach of the underlying technology we have at the company,” Swenson said in a news release.
“Powerband has tremendous potential with this strengthened leadership team and sponsorship and is at a critical inflection point as it commercializes its disruptive automotive fintech solutions. Our vision for the company is a growing and sustainable business model that is self-funded with internally generated cash flow, with several financing strategies available to the company,” he said.
“We look forward to providing a strategic plan by the end of the third quarter of 2022. We would like to thank Kelly Jennings for his vision and stewardship since the company’s inception and for his confidence in the new management and board of directors to guide us all through the next phases of the company’s growth trajectory.”
In a release, PowerBand said the short-term private-placement dilution “is markedly offset by the accelerated growth trajectory and long-duration capital to fund future growth.”
With this new leadership, the company plans to be a “preeminent player disrupting the automotive industry,” with the long-term goal of reaching a “significant portion of the revenue stack, across all industry participants, in a capital-light model that offers consumers and dealers low cost and streamlined solutions.”
The company said that Hunt and Poulin will be active in PowerBand’s overall corporate strategy and operations.
Hunt is a board member of JB Hunt Transport Services Inc., and is the managing member of Best Buy Here Pay Here of Arkansas, which has dealerships in Arkansas, Missouri and Oklahoma. He also holds that leadership post with Progressive Car Finance subprime auto financing company as well as the 71B Auto Auction And 71 Mobile Auto Auction businesses in Arkansas and Kansas.
Poulin has been CEO and chairman of SOAR Technology Acquisition Corp. since February 2021 and is also the founder and chairman of JPK Capital Holdings (Barbados) Inc., his Barbados-based family office.
He founded Luxury Retreats International Holdings, Inc., and was its president and CEO, prior to its sale to Airbnb in February 2017. He then was vice president of Airbnb’s global luxury business until 2019
“The automotive industry is consistently one of the leading total addressable markets in the U.S. and has been a generational opportunity for the Hunt Family,” Hunt said. “With the company now well capitalized and supported by strategic partners, our mission is to be one of the leading automotive technology companies in the space. We have been working diligently on a new strategic vision and look forward to sharing it with all our stakeholders.”
Poulin added: “The automotive industry is adapting to technological evolution, and we believe PowerBand offers a proprietary platform to monetize disintermediation, inside a capital-light, high-growth business model. I am specifically excited to join Bryan and Darrin to help lead this team to further the business and to offer it the technological experience and influence it needs to grow. Collectively, we see the potential to create an innovative fintech automotive marketplace.”
TRADE X, a Canada-based cross-border automotive trading platform, has lined up more debt financing.
The company said Tuesday it has secured two additional asset-backed lines of credit, both of which are $25 million (USD) with accordion features to expand to $50 million.
TRADE X said the financing will be put toward its “mission to simplify and streamline vehicle commerce across countries and continents.”
The first line of credit is provided by Forbright Bank and will be used for expansion from Canada throughout the U.S. Meantime, the second line is provided by “a global asset management firm with over US $100 billion in assets under management” and will be used to expand in Europe, Africa, the Middle East and Asia.
“TRADE X addresses the key challenges and obstacles to international vehicle commerce, from price discovery and trade financing to customs and vehicle inspections,” TRADE X founder and chief executive officer Ryan Davidson said in a news release. “We are excited for the next phase of our expansion, helping buyers and sellers transact globally, accelerate their inventory turnover and boost their profits. We are pleased to partner with Forbright to help finance our U.S. based business, as well as an additional global asset management firm to fuel our expansion outside of North America”
Luciano Butera, who is the executive vice president and chief operating officer of TRADE X, added: “TRADE X is helping to bridge the gaps in the global automotive trade, providing a secure, frictionless marketplace to connect buyers and sellers across continents and borders. We are helping our clients, from multinational companies to individual dealers, gain access to more vehicle options, better pricing, and a larger market to buy and sell vehicles.”
Online auto retail platform Clutch has raised $100 million (CAD) in Series B equity financing led by D1 Capital Partners.
Also participating in the round announced last week were Flight Deck Capital, Canaan Partners, Upper90, Real Ventures, GFC, Brand Project and FJ Labs.
Clutch plans to use the funding to “strengthen operations” in its existing markets of Alberta, British Columbia, New Brunswick, Nova Scotia, Ontario and Prince Edward Island. The company also has plans to launch in new markets over the next few months, while expanding its product line in 2022, as well.
Clutch also said it intends on adding more than 200 new employees next year.
Scott Baxter of D1 Capital Partners will join the board at Clutch.
“We believe consumers are seeking to buy higher quality pre-owned cars with greater convenience and more transparent pricing,” Baxter said in a news release. “We are excited to invest in the outstanding team at Clutch, help improve the car-buying experience for Canadians, and continue to back leading auto ecommerce franchises across global markets.”
Clutch chief executive officer Dan Park said in the release: “D1 has built an incredible portfolio of leading global technology companies and we’re thrilled to be partnering with Scott and the entire team at D1.
“D1 has deep experience in the online used car market and we’re looking forward to continuing to build the best car buying experience in Canada,” Park said.
E Automotive Inc., which is the company behind the EBlock digital wholesale marketplace and the EDealer digital retail products, said Wednesday it has closed its initial public offering.
The offering of 5.9 million common shares priced at $23.00 (CAD) per share generated gross proceeds of $135.7 million.
E Inc. plans to use net proceeds to strengthen its balance sheet, boost working capital and drive growth initiatives.
Common shares of the company began trading on the Toronto Stock Exchange under the “EINC” symbol on Nov. 3.
Shares opened trading Wednesday at $22.20 per share, having closed Tuesday at $21.90 per share.
FIX4 Capital wants to help Canadians get the finances they need to keep their vehicles running properly.
And Wednesday, the firm secured its own financial resources to do it along with expanded leadership that includes a familiar name from the Canadian wholesale market.
The company founded early last year to provide affordable and flexible car repair loans said it has raised $7.2 million in its first-round seed funding to help propel its growth plans.
According to a news release the round included the participation of venture capital firm Tactico, investment advisory company Keira Capital Partners and angel investors including Martin Lavigne, former president of National Bank and NBF Wealth Management.
Since launching its app and quick loan service earlier this year, FIX4 Capital highlighted that it has helped hundreds of drivers get back on the road through its promise of quick access to money for car repair and maintenance. In the process, the company said it has helped service centers reduce the potential for lost revenues even and especially in the throes of COVID-19.
“We’re committed to giving car owners access to fair car repair loans in an ethical, transparent, quick and convenient way,” said Tave Della Porta, co-founder and chief executive officer of FIX4 Capital.
“Too many people are being lured into borrowing money with unreasonable interest rates or terms. I’ve seen this story play out too many times and I’m delighted that there are many who feel the same way,” Della Porta continued.
Della Porta and his two partners, Derek Lloyd and Robert Bédard, have assembled a core team of experienced automotive and finance business leaders — and now experienced investors — who hold firm to the belief that a service-solution like FIX4 Capital is more needed than ever.
“We invested in FIX4 because the leadership team has the right combination of industry experience, customer service focus and technology know-how,” said Rick Ness, managing director of Tactico.
“We are excited about the vision of the founders and their ability to execute,” Ness added.
Other experienced executives who have joined FIX4 Capital include:
— Chris Harvey, former vice president at Autotrader
— Joe Carusella, previously vice president at Fairstone Financial
— Stéphane St-Hilaire, previously president and CEO of ADESA
“The need for fair financing in the auto repair sector is greater than we could have ever imagined,” Della Porta said. “The response we’ve received from our existing service repair partners and dealerships confirms what we suspected — a percentage of consumers are either unable to repair their vehicle or falling into the arms of predatory lenders.”
FIX4 Capital offers open financing of up to $10,000 with 12-, 24- or 36-month terms, with an interest rate of 19.9%. The company explained approval is based on the vehicle’s value and not one’s credit score.
Furthermore, FIX4 Capital said it does not require references, background or credit checks. The company has developed what it thinks is a simple to use, instant online loan approval system through which customers can secure approval in less than five minutes.
FIX4 Capital pays the service center on behalf of the borrower. The service is completely free for merchants. Customers can instantly find out their maximum eligible loan amount simply by providing their vehicle’s basic details — make, model, year and mileage.
“Customers can secure their loan right from the service center,” Della Porta said. “We fundamentally believe that everyone should have equal access to affordable and flexible financing when it comes to having their automobile repaired.
“We entered the market looking to disrupt high-interest lenders,” he went on to say. “Our rates are equally low for everyone, no matter what their credit or income situation is. We have no hidden fees or gimmicks.”
For information on FIX4 Capital or to start the loan process, visit fix4.com. Dealerships and auto repair centers interested in finding out more about the FIX4 auto repair financing program for their customers can call (855) 831-1186.
KAR Global certainly appears to have an interest in more than just the Canadian wholesale market stemming from its investment decisions.
On Wednesday, Canada Drives, an online car shopping and to-your-door delivery platform, announced the close of $100 million in funding, led by Jeffrey Housenbold’s Honor Ventures with participation from KAR and other strategic investors.
According to a news release, the investment will be used to further expand Canada Drives service across Canada to new markets.
Founded in 2010, Canada Drives has been one of the largest online automotive finance companies in the country, helping more than 1 million Canadians finance vehicles during the past decade.
In May, Canada Drives expanded its retail model from British Columbia to Ontario, allowing customers to purchase certified pre-owned vehicles online and have them delivered as soon as the same day.
“This is an amazing time to be a car shopper in Canada. We are excited to be bringing our online car shopping and to-your-door delivery experience to more markets in the coming months,” Canada Drives co-chief executive officer Cody Green said in the news release.
“This funding will support us in our goal of being able to fully service over 80% of Canadians with our car purchasing and delivery service by the end of the year,” Green continued.
Canada Drives said it currently has more than 1,000 vehicles available for sale in BC and Ontario and is scaling rapidly to grow that number.
Since expanding from BC to Ontario, Canada Drives highlighted that it has seen its customer base growing by 50% month over month.
The company went on to mention this round of funding brings “exciting new growth opportunities,” including the expansion of its 500-person workforce by more than 200 employees in the next 12 months.
In addition to opening new markets, Canada Drives said it also plans to more than double the amount of CPO vehicles available to shoppers in existing markets with this new investment.
Also according to the announcement, Jeffrey Housenbold will also join the Canada Drives’ board of directors, bringing 30 years of experience in leading, operating and investing in hyper-growth entrepreneurial companies.
Housenbold was previously a managing partner at the SoftBank Vision Fund and has served on numerous consumer companies’ boards, including DoorDash, Chegg, Grab, Caesars, Rappi, Groupon, Compass and Opendoor.
“The market need for a digital end-to-end platform to support the full life cycle of the used-car-buying experience is clear. The customer growth Canada Drives has seen in only a short amount of time makes it evident they’re providing a service that Canadians want,” said Housenbold, who is the founder of Honor Ventures.
“I am very excited to be a part of this journey as the Canada Drives team continues its national growth in Canada and captures more mindshare of the Canadian car buyer,” he added.
For more information, visit canadadrives.ca.
Autozen, a consumer-to-business marketplace that aims to give consumers “an easier, safer and more transparent way” to sell their vehicles, said Tuesday it has generated $4.2 million in an initial funding round.
The company, which is in the final stages of preparing to launch, is led by Olivier Vincent, whose background includes 20 years as an entrepreneur in marketplace, mobile and artificial intelligence.
Vincent’s team includes former Payfirma president Kalle Radage, who is Autozen’s chief operating officer. The chief technology officer is Xichi Zheng, who was vice president of engineering at Recon Instruments, and the business development advisor is Kevin Bent, a former executive at Postmedia Network.
“It’s baffling how selling a car in 2021 is as aggravating as it was 20 years ago. We’ve consistently heard from consumers that this industry has been stubbornly low tech for too long,” says Vincent. “With this initial investment, we’ve assembled a team with vast tech, product and go-to-market capabilities to address sellers’ frustrations and finally bring much-needed innovation to this industry.”
