On-demand peer-to-peer car sharing network Car Next Door is opening up its latest capital raise to users of the platform, raising up to $1.5 million through crowd-sourced equity funding platform Equitise.
The move has been a long-term plan of Car Next Door co-founder and chief executive Will Davies, who said unlocking equity for its members would help drive more enthusiasm and engagement with the start-up.
“Since we started our users have been really keen and passionate about what we’re doing and keen to invest and get involved,” he said.
“It’s a good way to get them more engaged and it will help with retention and word-of-mouth.”
Car Next Door, which lets users find a car in their neighbourhood to hire from a minimum of $25 per day, was founded in 2013 and now has 50,000 users and 1300 cars listed on the platform.
It will raise a minimum of $500,000 from sophisticated investors using Equitise, as part of a $4-5 million Series B round.
The company has already raised $2.3 million of its latest round from existing investors such as Caltex and Trevor Folsom’s Investible, which have doubled down.
Mr Davies said if this first foray into crowdfunding went well, the company would look to do another raise which would be open to the public once the legislation permitting private companies to partake in crowd-sourced equity funding passes the Senate.
“The big thing for us will be retail investors. We want people to be able to invest a few thousand dollars,” he said.
The start-up currently operates in Sydney, Melbourne and Brisbane and plans to expand to the Gold Coast, Canberra, Perth and Adelaide in the next few months.
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