South African startup Planet42, a car subscription platform addressing transport inequality by putting cars in the hands of people who cannot access traditional bank credit, has raised US$100 million in combined equity and debt funding to help it accelerate its expansion.
Launched as CarGet in 2017, Planet42 partners with dealerships across South Africa to offer access to a personal car to its largely underbanked clientele.
The startup uses an automated scoring algorithm to process client applications based on credit bureau, affordability, and alternative data. If the application is approved, Planet42 analyses the customer’s validation documents before purchasing the car from the dealership and renting it to the customer. The asset is secured with tracking technology, as well as comprehensive and mechanical insurance.
Planet42 last raised capital in the form of a US$30 million debt and equity funding round in February 2021, and has now secured a further US$100 million, also made up of both debt and equity investment.
The US$15 million equity round was co-led by Naspers and ARS Holdings, with participation from existing and new shareholders, including Rivonia Road Capital, which also provided a US$75 million credit facility. Private investors contributed a further US$10 million in debt financing. The funds will enable Planet42 to rapidly scale its business and meet its ambition of providing one million cars worldwide.
Since its last funding in 2021, the company has nearly quadrupled the size of its business and purchased well over 5,000 cars in South Africa in the last 12 months alone. Nearly 1,000 dealerships have been added to the Planet42 network. Following the success of the business model in South Africa, the startup recently launched in Mexico, with over 250 cars already delivered to customers.
“Planet42 is committed to breaking down the barriers that South Africans face in accessing cars. The struggle for credit, particularly for car finance, has been an ongoing challenge for millions of people in the country, even a decade ago, when the economy was arguably in better shape, and we understand the significant impact that this has on people’s lives. Essentially, no car equals lower standards of living and, in many cases, no income at all. Our mission is to empower people to create a brighter future for themselves, and we are proud to be a part of their journey towards financial inclusion and success,” said Grant Wing, South Africa managing director and country manager of Planet42.
“I’m thrilled to support Planet42 as they expand worldwide and improve the lives of thousands of individuals who face limited access to private transportation, which can significantly impact their quality of life and opportunities. Planet42’s team has displayed remarkable execution, with a proven innovative, cash-generating, and globally scalable model,” said Andrew Rolfe, general partner at ARS Holdings, who joins Planet42 as a member of its supervisory board.