Peer-to-peer car sharing platform Car Next Door is seeking to raise $5 million from investors to capitalise on rapid growth over the last 18 months, during which it expanded from Sydney and Melbourne into Brisbane.
Co-founder and CEO Will Davies told Dynamic Business that his start-up, which enables car owners to rent out their vehicles when they’re not in use, has enjoyed significant results across key metrics since its Series A funding round kicked off in September 2015.
“Our vehicle listings have nearly tripled and we’ve seen 4.4x growth in the number of approved borrowers to more than 30,000,” Davies said. “Meanwhile, monthly bookings have tripled and there’s been 3.7x growth in our gross revenue. All of these metrics are growing at increasingly faster rates as we scale up and we’re are on track to have an enterprise value of $190 million by 2022, based on a 10 x EBITDA valuation.”
Davies said early investment in Car Next Door’s online booking and payment platform – along with its solution (i.e. an electronic lockbox with a plug-in GPS tracker) to the “core problem” of P2P car sharing (i.e. secure, unattended access to cars via an) – had provided the start-up, which launched in 2012, with a “foundation for fast, sustainable growth”.
He added, “We also get a lot of growth through referrals and word-of-mouth, and we focus on creating a great experience for people who are renting out their car or borrowing cars, so that we continue to see this organic growth”.
Davies said Car Next Door’s board – Trevor Folsom (co-founder and director, Investible), Wayne Baskin (Deputy CEO, Booktopia) and Mike Rosenbaum (Founder, Spacer.com) – reflected the importance the company places on mental capital.
“Being able to discuss ideas with these people, who have founded and grown successful online businesses, has been invaluable,” he said. “The same goes for the mentoring we received from Steve Baxter after the Shark Tank win and from Ita Buttrose after we won the Westpac Businesses of Tomorrow award.”
To date, Car Next Door has raised $5.3 million in capital, including a $2.5 million investment from Caltex. Other investors include Impact Investment Group, which Davies said has “a focus on socially responsible investment” and has helped connect the start-up with “other Australian businesses that are working to have a positive impact in the world”.
Davies said the funding round, now underway, will be used to “substantially” scale the start-up’s marketing efforts across tested channels with proven results as well as create a service for business accounts and expand to Geelong, Adelaide, Canberra and Perth.
Asked whether the company’s future lies in driverless cars, Davies replied: “Driverless vehicles will be here really soon, so they will shape the future of any company that operates in the personal transport space. We’re not making our own driverless car in a shed out the back, but when they become widespread, we will have a large user base of people who are already embracing mobility as a service and poised to take up these new technologies, so we think that this will open up all kinds of opportunities for our platform.”
See also: Share a ride with Car Next Door’s Will and Dave: the duo challenging car ownership