MotoRefi has raised an additional $ 45 million in a round led by Goldman Sachs just five months after investors poured $ 10 million into the fintech startup to help boost its auto refinancing business.
The startup has developed an automatic refinancing platform that handles the entire loan process, including finding the best rates, paying off the old lender, and changing the title of the vehicle. MotoRefi says using its platform saves consumers an average of $ 100 per month on car payments, a goal achieved in part because it works directly with lending institutions. The company’s refinancing tools had been growing steadily until the COVID-19 pandemic shifted into high gear. CEO Kevin Bennett said MotoRefi is on track to issue $ 1 billion in loans by the end of the year, a five-fold increase from the same period last year.
Bennett said the short delay between rounds was due to investor confidence in his metrics, which have continued to grow at a rapid pace, and the backbone economy around the company.
“We frankly had no plans to relaunch yet, but they (Goldman Sachs) were comfortable given the relationship we have built and the track record and success of the company, to anticipate the turn and move forward. that schedule, ”Bennett said.
MotoRefi’s platform is available in 46 states and Washington DC and is expected to be available in all 50 by the end of the year. The startup has stepped up its recruitments to help support this growth. By the first quarter of 2021, it had more than doubled its workforce to 187 employees compared to the same period last year. Its workforce now stands at 250 employees. The company hired several senior executives, opened a new head office and partnered with SoFi. Jade Mandel, vice president of venture capital and growth equity at Goldman Sach, has joined MotoRefi’s board of directors.
And Bennett sees plenty of room to grow as consumers seek ways to rebalance their debts. The auto refinancing market in the United States is $ 40 billion. However, the overall auto loan debt is $ 1.3 trillion. With 40 million car loans created each year, MotoRefi is promised a constant flow of new potential customers.
The new capital injection, which included investor IA Capital as well as funders Moderne Ventures, Complice, Link Ventures, Motley Fool Ventures and CMFG Ventures, will be used to continue to develop its products and services and hire more people. MotoRefi has raised $ 60 million since its inception in 2016.
Bennett believes the company is now in a position of self-sufficiency.
“Fortunately, we’ve gone beyond the world where we raise capital and then raise more as we run out of capital,” he said. “I think we have a great, sustainable business and so in a sense the trail is endless and we’re building a great profitable business. This doesn’t mean that we will never increase again, but it will be based on strategic considerations, rather than necessity. “