INSUBCONTINENT EXCLUSIVE:
The long-term future of transportation might see less people owning cars, but today a lot of private vehicles are still on the road, and now
a startup that’s building a multi-faceted marketplace to help fix them has raised some funding
Caroobi, a Berlin company that connects individuals with mechanics, and mechanics with parts suppliers, has picked up $20 million, money
that it plans to use to expand its business into new markets — it’s active today only in Germany, Austria and Switzerland, and is just
starting to open for business in the UK — and its platform to cover a wider range of services.The Series B round was led by NGP Capital,
formerly known as Nokia Growth Partners, a fund backed by the Finnish telecoms giant
This is part of its “smart mobility” investment strategy.“We are looking for promising companies in the mobility sector globally and
believe that the integrated model across the value chain that Caroobi is building has huge potential
The team is great and we are looking forward to supporting the company’s international expansion and building a global category winner,”
said Walter Masalin, Partner at NGP Capital, in a statement.Other investors in this round include Target Global, BMW iVentures, DN Capital
and Cherry Ventures.The BMW investment is financial, co-founder and MD of Caroobi Mark Michl said in an interview, with no strategic plans
Although BMW an iconically German company, the iVentures arm is actually in the Bay Area; Caroobi, in fact, is iVentures’ first investment
in BMW’s home country.Caroobi is not disclosing its valuation but I understand that it is now over $100 million
The company is not yet profitable, by design, and has raised around $30 million to date.The amount of this investment is notable when you
consider the size of it versus the potential of Caroobi’s business today
The company says that in its current German footprint, for example, it works with only 750 mechanics today, but with a total addressable
market of around 35,000 mechanics
It’s currently servicing some 2,000 cars per month and growing 100 percent month-over-month.“The market potential is huge, and we
currently have well below only one percent of it,” Michl said.As Michl and his co-founder Nico Weiler explain it, Caroobi is providing a
platform to fill what is effectively a gap in the legacy automotive market.In many countries, one of the most common routes for repairing a
car, or getting it serviced, is to use an independent garage or mechanic
But these days, as much of the process of finding and contacting tradespeople has moved online, much of the mechanic world has not come
along.You may find some recommendations on services like Yelp, and even some targeted directories that help direct referrals for independent
mechanics to quote for work, such as WhoCanFixMyCar in the UK, or even services that come to you on-demand, such as YourMechanic in the
US.But what’s largely lacking is a platform that not only helps match up car owners with mechanics and their garages, but also provides
those customers with transparent price lists and helps to manage not just bookings, but payments and potentially disputes (and soon, service
On top of that, the Caroobi platform offers services to the mechanics themselves.“There are two customers we are addressing,” said Michl
“One is consumers, who often may not know if mechanics are offering them fair quality and price
We are getting around that by offering services directly to customers,” he said
“Two is the mechanic.”Mechanics services come in two parts, Weiler said
The first is the customer-facing side, Caroobi is giving mechanics are more efficient way of interfacing with customers, with accounting and
billing software that links up with Caroobi’s back-end, and scheduling tools to book in appointments
Weiler said that Caroobi’s customer referrals typically account for 50 percent – 60 percent of all mechanics’ jobs once they join.The
second is the supplier-facing side, which is a newer area of business for Caroobi
Mechanics typically work with either a small group of distributors, or more likely one or two purchasing groups, which gives the mechanics
less flexibilty in what they can order, the general supply levels, and how much everything costs
Caroobi currently sources parts from over 100 distributors and manufacturers, giving those mechanics a better selection and likely more
competitive pricing.“For mechanics, the parts acquisition process has always been intransparent and inefficient
By sourcing our parts directly from manufacturers we are establishing a lean, efficient process in the market, which becomes more cost
effective for our customers and partner mechanics.” Michl said.Caroobi is not disclosing what this works out to in terms of actual prices,
or what kind of a cut Caroobi gets from it
Michl does say that the company takes a small percentage for every kind of transaction, and that these often work out to be competitive or
even cheaper than what the mechanic might have charged, were he working directly.
