CarBar — an Australia-based subscription car service — has received a $16.8 million AUD ($11.9 million U.S.) cash injection from investors, including Insurance Australia Group (IAG). The capital will be used to fund the company’s national expansion.
The funds give IAG a majority stake in the business, in addition to a spot on its board of directors.
“The partnership is an integrated strategy, with multiple layers to it; primarily helping IAG’s customers’ mobility needs and providing customer value,” he said in a statement.
CarBar was founded in Melbourne in 2016 and expanded to Sydney this June. It initially allowed individuals to purchase used vehicles totally online, before offering subscriptions to cars from as little as $109 to $1,000 per week.
As part of its national expansion, the service is also aiming to convince businesses to replace their corporate car leases with subscriptions. “The people or businesses who have subscribed to cars can buy them outright after trialing them, or new customers can buy them from us, knowing the cars have been well-maintained,” Hang said.
The IAG investment follows a $5.8 million Series A funding round last year.