Electric car subscription service tech startup Onto raises $60 million to expand into Europe
Electric vehicle (EV) subscription service startup Onto has raised $60 million in equity in a Series C funding round to expand into Europe, starting with Germany. The round was led by the financial services company Legal & General.
Existing investors including Alfvén & Didrikson, Accelerated Digital Ventures, Cerebrum Tech Limited, and the family office of Jim O’Neill participated in the round. The latest round brings Onto’s total funding to date to over $330 million in equity and debt.
It’s a challenging time for the electric car industry with the semiconductor chip shortage, but despite that, Onto grew more than 500% last year. Onto’s focus on usership over ownership, offering subscribers choices and flexibility, has proven popular with electric car veterans, novices, and the EV curious.
The UK-based startup’s monthly all-inclusive electric car subscription service has disrupted the electric vehicle ownership model nationwide. 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.
Onto was founded in 2017 by CEO Rob Jolly and Dannan O’Meachair and provides an accessible, flexible, and easy way for motorists to join the EV revolution. In the last five years, Onto’s new and innovative all-inclusive car subscription service has proved a hit with consumers – enabling many to move away from the traditional internal combustion engine. Since 2018, Onto has expanded rapidly, partnering with new charging and electric car providers as more EVs become available to suit all budgets. Onto currently offers 18 models, with subscriptions starting from £489 per month.
The shift from gas to electric has continued at an accelerated. According to the Society of Motor Manufacturers and Traders, registrations of plug-in hybrid and all-electric vehicles are now about 10.7% of the overall market share in the U.K. in 2020, up from 6.6% in 2019.
A recent EY Consumer Index study also showed that 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.
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 also 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 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.
Jolly said: “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.
Wian Pieterse, Managing Director, Fintech at Legal & General, said, “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.”