Carbar has raised $28.9 million in a funding round led by IAG and Seven West Media.
IAG, Australia’s biggest insurer, already has a majority stake in digital car subscription and trading startup Carbar following a $16.8 million raise in 2019.
Founded in Melbourne in 2016 as a virtual car dealership, Carbar now has 80 employees and operates in Victoria, New South Wales and Queensland, having delayed plans to launch nationally in 2020 in the wake of the Covid pandemic.
The fresh cash will be used to broaden Carbar’s marketing, partnership and technology capabilities, as it looks to scale local operations and capitalise growing interest in electric vehicles (EVs).
Co-founder and CEO Des Hang said Carbar has seen a more than 2000% increase in active subscribers since the July 2019 cap raise.
“This round will help us expedite growth in the business and make Carbar a household name. While we are thrilled with our growth to date, we realise that our current round of car subscribers are really early adopters,” he said.
“Given the experience overseas — in less car-obsessed markets — we know that with the right push, this trend of subscription can compete with and rival car ownership. We’ll be leading the charge on this for the entire car subscription industry.
Hang said he believes Carbar will play an instrumental role in the adoption of EVs in Australia.
“The global rise of EVs is an inflection point for the auto industry. We want to be a global brand before this trend is fully realised, and in order to do that we need to further accelerate our growth,” he said.
Seven West Media’s Head of Seven West Ventures, Alan Stuart, said Carbar holds a unique position in the evolving auto industry.
“It’s a compelling consumer offering that, with the right push, has the ability to totally change the way we perceive EVs in Australia,” he said.
“By working closely with Carbar, we aim to accelerate its growth and help more Australians realise the value in car subscriptions and EV technology.”
Hang said 2021 saw the business establish a range of commercial partnerships, with Carbar managing AGL, Aurora and sonnenDrive’s EV subscription programs.
Carbar also established an ABS facility aimed at funding the expansion of its fleet, with a view to increasing its total proportion of EVs from 5% to 25% over the next few years.