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Electric car subscription service Onto raises $60M USD to launch European expansion
Onto will enter Germany in early 2023 as it seeks to accelerate electric car adoption across Europe. The equity round has been led by Legal & General.
27 Jul 2022
All-inclusive electric car subscription service Onto, has raised $60M USD in equity in a Series C funding round led by Legal & General. The round will enable the business to consolidate leadership in the UK and expand into Europe, starting with Germany.
The investment comes as the UK-based sustainable mobility business continues to see rapid growth, having grown more than 500% last year. This growth comes despite the global semiconductor chip shortage creating challenges in the industry.
The innovative business model enables people to subscribe to an electric car on a monthly contract. The subscriptions are inclusive of public charging, insurance and breakdown cover, without any upfront deposit or long-term commitment. Onto is disrupting the traditional ownership models by offering consumers a truly flexible subscription alternative.
Presently, the UK’s leading car subscription service, Onto will use the investment to launch into Germany in 2023 as it looks to accelerate electric car adoption in mainland Europe, and secure its position as the go-to brand for those looking to make the switch to electric. The company already has an office in Germany and welcomed their newly appointed Managing Director of Germany, Joerg Feldheim. Having worked in leadership roles in the automotive industry for over two decades, Joerg brings extensive international startup, management and transformation experience to drive the company’s expansion.
Onto’s business model taps into three key trends. As a player in the subscription economy Onto focusses on usership over ownership, giving drivers more choice and flexibility around the car they drive.
At the same time, digitalisation is having a significant impact on the automotive industry, Onto has streamlined the entire user experience by digitising the end-to-end user journey. From signing up and booking a car online to having it delivered to your doorstep within just a few days, a focus on the simplicity of the user journey plays into the increased consumer demand for ease and convenience.
Finally, the raise marks a significant moment for the journey to net-zero as the shift towards 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.
Leading financial services company Legal & General led the round. Existing investors including Alfvén & Didrikson, Accelerated Digital Ventures, Cerebrum Tech Limited, and the family office of Jim O’Neill participated in the round. The Series C raise brings Onto’s total funding to date to over $330 million USD equity and debt.
Onto’s monthly subscription service includes 750 miles per month, insurance, servicing and maintenance, and free public charging at more than 12,500 points via its UK network of charging partners - Shell Recharge, BP Pulse, InstaVolt and Tesla Supercharger.
Rob Jolly, CEO and co-founder at Onto: “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.
A recent EY Consumer Index study showed 49% of car buyers want an electric vehicle as their next car, with upfront costs and concerns about charging seen as the most significant barriers for first time EV buyers. With almost 90% of our customers preferring the convenience of an all-inclusive package that covers everything - even public charging - our unique proposition addresses these customers’ needs with a choice of 18 car models.Onto takes the hassle and effort out of getting an EV. We believe that making it simple and easy to get an electric car is essential to building a sustainable future,”
Wian Pieterse, Managing Director, Fintech at Legal & General: “At Legal & General we’re committed to playing our part in tackling the climate crisis and investing with purpose into companies that do good. Onto is an exciting example of this; an ambitious company with a talented management team that will play a vital role in accelerating the transition to electric vehicles. We expect to see increasing demand for subscription models that not only pave the way towards a sustainable way of living but also meet the needs of those who don’t want to tie up valuable savings or incur a loan to buy a car.
“Onto has grown rapidly over the last four years, and we’re looking forward to working with the team to help the business scale and expand into new markets, all while investing to benefit the future of our society”.
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Notes to editors
Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with £1.2 trillion in total assets under management (as at FY23) of which c40% (circa £0.5 trillion) is international.
We have a highly synergistic business model, which continues to drive strong returns. We are a leading international player in Institutional Retirement, in Retail Savings and Protection, and in both public and private markets through our Asset Management division. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.
As at 7 June 2024, we estimate the Group’s Solvency II coverage ratio to be 224%.
As at 11 June 2024, Legal & General has a market capitalisation of £14.6 billion.
Legal & General Retail helps create brighter financial futures for all our customers. The division covers the savings, protection and retirement needs of our c.14 million retail policyholders and workplace members.
In 2023, we had total individual annuity sales of £1,431 million, and issued £299 million of Lifetime Mortgages and Retirement Interest Only Mortgages. Our Workplace pension platform served 5.2 million members, while our Protection businesses gave peace of mind to several million direct, group and US customers, taking in £1,991 million of UK and $1,584 million of US gross written premiums.