Knowledge

Author: MacDonald Gomo

Category:

Date: 30 April 2020

Verdant Capital advises Planet42 on its ongoing capital raising programme. Planet42 (formerly ‘CarGet’) is the fastest-growing provider of Rent-to-Buy vehicle finance in South Africa

Following the successful closing of a 2.3-million-euro equity capital raise, Planet42 is seeking local and hard currency debt funding from specialist investors for the expansion of its second-hand vehicle long-term rental portfolio. Planet42 democratizes access to mobility by serving the financially excluded portion of the population – the people ignored by banks and other traditional financiers.

The founding team of Planet42 has extensive experience in alternative vehicle finance and private equity in Africa. The CEO was previously a Country Manager in Mogo Finance while the CFO was the Head of African Investments for Trigon Capital.

The customers of Planet42 are not eligible for bank financing due to overly strict lending criteria. Planet42 manages credit risk by screening customers with an automated scoring algorithm and securing its assets (title deed, tracking technology, comprehensive and mechanical insurance).

South Africa has 11 million passenger cars but the funding for older second-hand vehicles is limited and very fragmented. Planet42 intends to grow its portfolio of second-hand passenger cars to 100,000 over the next four years in South Africa and expand to other large markets where lower- and middle-income groups struggle with access to financing.

In excess of 1,800 cars have been provided to clients since inception, having significant social impact by providing access to mobility to people ignored by traditional financiers. The company has a revenue run rate of USD 4 million for 2020 and about 5,000 customer applications are processed monthly.

Source: Company

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