Dubai and Riyadh-based car subscription startup Invygo has raised $10 million in a new round of funding led by Middle East Venture Partners, a Dubai-based venture capital firm.
Other investors in the round included Al Rajhi Partners, Arab Bank, Amana Capital, Palm Drive Capital, along with existing global investors Signal Peak Ventures and Knollwood Investment Advisory, the company said on Monday.
The latest funding brings the total capital raised by Invygo to date to $14.6 million.
The company will use the new proceeds to expand its operations into new markets and further build its core technology.
“Car subscription with Invygo provides customers with unparalleled convenience and financial flexibility … we are excited to welcome world-class investors on board as we strengthen our leadership position in Saudi Arabia and the United Arab Emirates, along with plans for regional expansion,” said Eslam Hussein, co-founder and CEO of Invygo.
“We offer investors a financially sustainable model that suits the current macroeconomic environment and builds confidence in our business,” he added.
Founded in 2019, Invygo is present in Saudi Arabia and the United Arab Emirates – the two largest economies in the Arab world. The company aims to invest in both markets and create more than 100 jobs over the next 12 to 18 months.
It’s an app-based service that allows customers to choose, drive and switch cars at the click of a button.
The Covid-19 pandemic boosted the company’s business as people shunned public transport amid social distancing requirements and sought cheaper options to use cars autonomously.
The global car subscription market is forecast to reach more than $12 billion by 2027 with a compound annual growth rate of 23.1%, up from $3.6 billion in 2019, according to research and consulting firm Allied Market Research.
In Europe and the United States, car subscriptions will contribute between $30 billion and $40 billion by 2030, up to 15 percent of total new car sales, according to the Boston Consulting Group.
Invygo customers can subscribe to a car from their smartphone and have it delivered to their door.
The model is flexible, no down payment required. All customers have access to insurance products as part of a bundle offering that also includes maintenance, servicing and roadside assistance at no extra charge, Invygo said.
The company also offers a ‘subscription to own’ offer that allows customers to buy the car after using it. At the end of the subscription period, customers can choose to buy the car for an additional amount or return it.
“Around the world, access to mobility has proven economic benefits for all populations. In our region, however, financing challenges have limited car ownership options and this is a problem that Invygo is solving,” said Ali Almajthoob, Managing Director at MEVP.
“We are excited to support Invygo as they reimagine the traditional car ownership model and create opportunities for consumers and industry in Mena [Middle East and North Africa]” said Mr. Almajthoob.
With Invygo, customers can access thousands of vehicles from various brands. This includes mass market brands such as Toyota and Nissan and luxury brands such as Range Rover and BMW.
Invygo, an asset light company that does not own the cars provided to customers, has partnered with several car distributors and car rental companies, including Budget Saudi, Key Car Leasing and Saudi Arabia’s Taajeer Group, as well as National Car Rental (Al Tayer). ), Diamondlease (Al Habtoor) and Paramount in the UAE.
“By combining customer demand with our deep technical expertise, our teams have built services that are transforming the automotive industry,” said Pulkit Ganjoo, co-founder and director of data science at Invygo.
“[We] are continuously leveraging and advancing AI data modeling tools to accurately forecast demand, pricing and market growth to optimize market reach,” said Ganjoo.
Updated: October 31, 2022, 10:15 am