Carmoola, a UK fintech taking on traditional lenders in the £100 billion direct-to-consumer car finance market, has secured a £15.5 million equity investment.
Investment came from US-based fintech specialists QED Investors; VentureFriends; InMotion Ventures, the investment arm of JLR (Jaguar Land Rover); New York-based investors AlleyCorp; and Kyiv-based u.ventures.
The raise follows an £8.5 million Series A round and a £95 million debt facility, both secured in February last year.
Carmoola, launched its app in March 2022, with an ambition to transform the cumbersome and complex car finance market by providing an app-based mechanism for fast finance approval tailored to an individual’s specific needs.
Aidan Rushby, co-founder and CEO of Carmoola, says: “Carmoola came about because we could see that the used car finance market was broken, but the status quo suited traditional lenders just fine, so nobody was doing anything about it."
The new capital arrives as many existing lenders face the prospect of an FCA probe into the potential mis-selling of car finance, a move that could open the floodgates to compensation claims from millions of drivers.
Says Rushby: “Our goal is to make car financing as user-friendly and hassle-free as possible, and this unrelenting focus has already seen us support the purchase of over £46 million worth of cars. With this new funding, and the support of our investors, we are poised to help even more people buy the car of their dreams.”
With the UK’s used car market growing year on year, and recovering towards pre-pandemic levels, the new funding will be immediately deployed to scale the business to reach and serve more car buyers and drive a pathway to profitability says Rushby.