IPO-Bound Zoomcar Raises $92 Mn From SternAegis Ventures; Plans Expansion Across Asia, MENA

Bengaluru-based self-drive car rental startup Zoomcar has raised a new round of funding through the private sale of shares worth $92 Mn to SternAegis Ventures and other international family offices.

The funds raised will be used to finance its growing market share in car rental service in India and select markets across Asia and the MENA (the Middle East and North Africa) region, the company said in a statement.

The startup plans to continue investing in its advanced engineering and data science platform to strengthen its market leadership in global car sharing. It expects to increase investments across IoT, machine learning, and computer vision-related applications. The company also plans to strengthen its enterprise software offerings to original equipment manufacturers (OEMs) and insurance companies.

Founded in 2012 by David Back (who left the company in 2015) and Greg Moran, Zoomcar started as a D2C car rental service. Later, it also introduced a shared subscription model whereby users can rent out their car if it’s sitting idle. Currently, Zoomcar has a fleet of over 10K cars across 45 cities in India.

Apart from car rentals, the startup also provides Industry 4.0-based vehicle monitoring and management systems, asset management cycles for cars, and subscription-based third-party fleet management services.

Zoomcar has, to date, raised more than $290 Mn in funding across multiple rounds. It last raised approx $40 Mn in a venture round led by NKM Capital. Prior to that, Zoomcar raised $30 Mn for its Series D round from Sony Innovation Fund in January 2020.

Inc42 also reported that Zoomcar’s parent company infused $5.5 Mn in the car rental platform in May 2021, while the mobility segment was recovering from the effects of the Covid-19 induced pandemic.

The current fundraise comes shortly after Moran confirmed Zoomcar’s plans for a public listing in the US market. The startup is considering listing in the US by floating a new special purpose acquisition company (SPAC).

A blank-check firm, or a SPAC, is a development stage company with a business plan centred around a merger or acquisition with another company. “There’s a lot of momentum in the public markets for this type of story. We’ve been at it (IPO-Planning stage) now for a long time so it’s only fair to want to bring liquidity into the system for early investors,” Moran had said at the time.

Confirming the plans of public listing post the private fundraise, Moran said, “This successful crossover financing is a milestone for Zoomcar as we enter the next phase of our international growth and position the company to enter the public equity markets.”