Santa Monica, California-based car-as-a-service company Fair announced it has raised $385 million in Series B funding led by SoftBank. Exponential Ventures, Munich Re Venture’s ERGO Fund, G Squared, and CreditEase also participated in this round.
The Fair app makes it possible to handle the end-to-end process of buying a car on a user’s mobile device. Fair users simply scan their license and input banking information (or credit card) to shop for pre-owned cars with all-in monthly payments they can afford. And they can sign for the one that they want with their finger, pick up the keys, and drive it for as long as they want with no debt, long-term commitments, or physical paper.
Here is a video of how it works:
“We’re in the midst of a transformational shift as consumers choose access to services over ownership,” said Fair CEO and founder Scott Painter in a statement. “This financing signals that Fair will be a critical and enduring component of this transition in mobility as we replace the decades-old, debt-based system of car-buying with a payments platform that’s simple, affordable and flexible.”
Ever since Fair launched in August 2017, Fair provided cars for over 20,000 users through 3,000 dealer partners in 26 markets across the U.S. With this round of funding, Fair is planning to scale its consumer platform and partnership with Uber globally.
“Fair provides a simple and affordable way for people to get access to a car for personal use, ridesharing or carsharing,” added SoftBank Investment Advisers senior investor and investment adviser to the SoftBank Vision Fund Lydia Jett. “This investment will enable Fair to provide cars on a global scale, and help reduce the barriers to mobility. We believe it unlocks tremendous value for customers, and will create new partnership opportunities across the transportation industry more broadly.”
Like its consumer business, Fair essentially provides an alternative to a loan or lease for Uber drivers. This is useful for Uber drivers who find the traditional car-buying process to be inflexible or unaffordable.
Fair launched a partnership with Uber in February 2018 as potential rideshare drivers can access Fair from within the Uber app to select the vehicle they want, drive it on a weekly basis, and walk away whenever they want.
Back in April, Uber sold its Xchange Leasing portfolio business to Fair. It is believed that Xchange’s book value for the 30,000 vehicles was around $400 million, according to a TechCrunch report. SoftBank — which is also an investor in Uber — was impressed by the way Fair was able to turnaround Uber’s leasing business.
“The simplicity and flexibility of Fair’s model will unlock new levels of opportunity for drivers who want to earn money with Uber,” explained Uber chief product officer Manik Gupta. “We are excited to expand our partnership with Fair and help more people around the world access opportunities to work and earn on their own schedule.”