Greek flexible vehicle leasing startup instacar is raising €55 million in capital as it accelerates its expansion into new markets and transforms into an app that will provide everything related to a car, from leasing to maintenance, tire changes, washing or even parking.

“55 million euros includes AMC and loans,” Antonis Samothrakis, who co-founded instacar with Antonis Zois in 2018, explains to K. “The funding round was led by Autohellas and Greek fund Ellikonos 2 SCA SICAR, which invested in companies such as Rodoula, Minerva and others. The round also included Olympia Group and Velocity.Partners, who together with Autohellas previously invested in instacar.

The company has developed a platform for flexible leasing of vehicles, i.e. electric bikes, cars, minibuses, etc., which an individual or legal entity can rent for a period of 1 to 24 months. “This process is without the commitment and down payment of traditional leasing, while a monthly rental consumer can use a modern car and own it in a few clicks.”

Mr. Samothrakis advocates for the flexibility offered by a specific vehicle leasing model. “Instacar allows you to rent a car for any period with the option of a replacement or even a purchase.” He believes flexibility is driving more and more businesses and consumers to adopt these models, even in times of economic uncertainty like the one we’re experiencing today.

With the €55 million funding, the company is expected to increase the fleet of vehicles in its portfolio and aims to exceed 5,000 vehicles in 2023. At the same time, following the example of its investors, it is considering entering countries such as Romania and Portugal. “At the moment we have selected Greek strategic investors. Foreign funds that I have contacted from time to time have asked us for rapid and uncontrolled growth, which I do not want at the stage the company is at. Sustained steps are needed to be able to support our expansion into other countries.”

Instacar, like other companies, borrows capital to develop its model, providing the cars themselves as collateral. But with interest rates rising and the value of money rising, the viability of such models is questionable. “Instacar lending is carried out on preferential terms and comes from systemic banks, European and Greek. In addition, interest rates are at a reasonable level, also thanks to our investors, as the presence of Autohellas and the Olympia Group in our share capital provides security for our creditors.” Mr. Samothrakis notes that the company does not intend to raise rents in the next period due to wider economic volatility in the market.

By 2023, the fleet of vehicles in its portfolio is expected to increase to 5,000 vehicles.

The company buys 90% of the vehicles in its portfolio, most of them new, and leases the rest from import companies and dealers. At the same time, in order not to “get lost” in the event of a fall in the value of cars in the future, the company retains a deposit for them in the amount of their resale value. “Every year we grow by 100%, our turnover reached 7 million euros last year and we have a team of 65 people. We have over 3,000 clients, most of which are small and medium-sized enterprises in all industries.”

Since 2019, when Instacar first launched its service, the competition in the flexible vehicle leasing industry has started to intensify, which doesn’t bother him. “We are one of the most established players in the market and we are constantly improving our technology to stand out from the competition,” says Mr. Samothrakis, explaining how instacar is evolving into a provider of all car-related services. “We’re building a one-stop app that lets you rent a car, book a garage appointment, find parking, and more, even if the car wasn’t rented through instacar.”

“We had difficulty obtaining loans to support our business model, as there were no organizations in Greece that could provide companies like us with the amounts needed for our development. There were only banks and individuals,” he says of the difficulties the company has faced in recent years.

“The second difficulty was the delays in the delivery of new cars and the shortage in the market during the pandemic, which eventually turned into an opportunity for us. While we really couldn’t get a lot of cars and grow the company faster, the fact that we were offering delivery-ready cars at this time to those who needed to relocate ended up being to our advantage.” These issues also helped spark the idea for the instacar.

“When I was on a well-known ordering platform, I tried to get our first cars on lease, but the leasing companies did not serve us then, because the company had huge turnovers, but there were losses. Finally, after much effort, we managed to get something, but by issuing huge advances,” he notes. These difficulties, as well as his acquaintance with Mr. Zois, who ran a car rental company in Mykonos, contributed to the establishment of the company. “I put everything aside and thought that this should become a business,” he concludes.