- Paris-based startup will enter new markets, including London
- Nokia venture arm, Cathay private equity, lead investment
Drivy, a French startup that lets people hire out their cars in much the same way Airbnb runs a market for houses, said Thursday it raised 31 million euros ($35 million) to fund its continued expansion across Europe.
Already operating in France, Germany and Spain with 36,000 cars on its system, Drivy will use the new money to expand into many more European cities, including London, Paulin Dementhon, Drivy’s chief executive officer and founder, said in an interview. The company plans to open in three additional markets in 2016. Dementhon said Italy, the Netherlands, Portugal and Poland are interesting.
Drivy struck an insurance deal with Allianz SE to offer protection for drivers who use its service, covering them for civil liability and bodily injury, as well as the owner of the car for damage. The cost of this contract is built into the rental price.
Dementhon said Drivy would also be looking to offer more vans and small trucks for rent over its platform. "The market for commercial van rental is almost as big as the market for cars," he said. Although Drivy initially targeted individuals looking to earn extra cash from their personal cars, Dementhon said the platform has begun to attract entrepreneurs and small businesses that are using it to make money renting fleets of vehicles.
Dementhon said the average rental length on the platform is currently about three days. Drivy is seeing more demand for day-long and even half-day rentals, he said, and the startup has been trying to find ways to make the rental process as instantaneous as possible.
To that end, the company is aiming to install its Drivy Open system -- a piece of hardware installed into a car’s door locking mechanism that allows customers to unlock a vehicle with an app -- more widely. Introduced in December 2015, only 300 cars in Paris and Berlin currently feature this system.
Major automotive players are exploring similar ambitions. Bayerische Motoren Werke AG’s Mini brand plans to build similar devices into its latest cars to let owners to rent them.
Cathay Innovation, the venture-focused arm of Paris-based private equity firm Cathay Capital, and Nokia Growth Partners, the venture arm of the Finnish telecom company, led the latest investment in Drivy. Bpifrance Ecotechnologies Fund, Via-ID and Index Ventures, which invested in the company previously, also participated in this round. The startup has now raised a total of 47 million euros in four investment rounds.