Australian mobility software provider Loopit has successfully closed a $3.95 million pre-Series A funding round for its expansion across the US market.
This investment bolsters Loopit’s role as a key technology enabler, empowering OEMs, dealerships, and rental companies to seamlessly transition to flexible car access models, including car subscriptions and micro leasing, it says.
The latest funding includes contributions from existing investors Upswell, Common Sense Ventures and Luxem, along with new participants a major AVIS licensee AeroCorp, and RAC venture capital arm BetterLabs.
The capital injection will enhance Loopit’s capabilities to widen its US market presence and sets the stage for a Series A round later in 2024, says Loopit.
Loopit co-founder Michael Higgins highlights the shift towards more affordable subscription services driven by economies of scale and increasing confidence from automakers.
He refers to the French government’s subsidised flexible EV leasing program, which saw its yearly targets double in just six weeks, as an indication of strong market demand.
Higgins notes the business model’s success indicates that affordability and access, not technology, will play crucial roles in mainstream EV adoption.
“Car subscription is already financially attractive for consumers, particularly consumers who prioritise flexibility,” Higgins says.
“As automakers refine their pricing models, we anticipate further reduction in costs.”
Higgins says changing consumer preferences, especially among younger demographics, are driving expansion of the car-as-a-service market.
He says the cost of subscribing is currently comparable to car ownership when considering maintenance, depreciation, and other expenses.
However, Higgins foresees subscriptions becoming the more economical choice for most people as prices continue to fall.
“The automotive industry is undergoing rapid innovations with electric and autonomous vehicles,” he says.
“The next significant breakthrough will be in transforming the car ownership experience, especially as vehicles increasingly incorporate advanced technology.”
Loopit provides flexible and robust mobility management software to automakers, dealerships, fleet and rental providers including Porsche, Subaru, Polestar and SIXT.
