Peruvian company Leasy protects $ 17M from debt, equivalent to providing a car loan to LatAm pedestrians – Referus

Leasy, a startup that provides car finance for motorists in Latin America with a subscription model, has secured a $ 2 million equity and a $ 15 million loan.

Gregorio Gilardini and Alejandro Garay, originally from Spain, originally from Spain, met in Peru a few years ago and discovered that they were both interested in using technology to make a difference in society and to help people escape “the snare of poverty.”

They launched Leasy in 2018 with the aim of helping people who would like to earn money as motorists can afford to pay for cars, thus earning an income. Traditional financial institutions charge exorbitant interest rates and require large payments, making it almost impossible for members of low-income people to afford their own cars.

Lima-based Leasy differs, says Gilardini, in that its interest rates are very low and the terms are very flexible. It claims to offer loans “built to the needs of the rider” at competitive prices such as rental market prices. A 5% down payment is also required, compared to the 20% to 30% required by most banks.

“That’s the amount of money most people don’t have,” said Garay. “It’s very lively every day and the drivers are like ghosts in the system.”

So far, Leasy has been arrested without charge lines from Banco de Credito del Peru (BCP) as well Mitsui Auto Finance (MAF) – the founders say they are grateful because the first place in Peru is changing.

Magma Partners led its seed, with other investors including IncaVentures, BuenTrip Ventures, GRAM, Otto Holdings and Nucleus EMV, among others. It is also part of the Endeavor ScaleUp program. The company sought the money because it realized it “needed to measure at a faster pace.”

Surprisingly, Leasy has been profitable – and that means total revenue and EBITDA positive – since its first month of operation, according to Gilardini, it also saw 170% revenue growth in 2021 compared to 2020. That positive financial position was invaluable during the fundraising process, Gilardini said, because it allowed the party to negotiate better terms.

“As we come from an area where VC investment is still a lot to improve, we could not see much of how long the fundraiser would take and we could not run out of money at any time,” he added.

When they first started, they were surprised that so many motorists were hired because they could not get a car subsidy. For many, it was the only way to reach the market for the jobs they wanted to pursue. And when Leasy started renting and secured EuroRenting (a company like Hertz) to be its first driver, they finally considered switching to financing a car with a subscription model.

The business structure is designed to make it easier for riders to finance the car, with the insurance included in the process and the “simple” payment process. Flexible words also remove pressure. For example, if a driver decides he wants to move to another city and no longer needs a car, he can return the car to Leasy without penalty, notes Garay.

Regarding its technology, Gilardini told Referus that it was “truly improved” from the start.

“When we got into this, we knew we needed something to go up,” he said. “We have also realized that we are working in a less risky environment when it comes to debt and we have to prove that we are reducing the risk associated with bankruptcy. This has actually forced all our technology to get to T from the start. ”

Its drivers app is designed to provide full transparency of how their payments are going and when they need to pay.

“It’s like building this ecosystem and connecting with drivers to make them feel like they have support 24/7,” Gilardini explained.

In 2019, Leasy partnered with Uber to find potential drivers to work with and collect data. It chooses who it sponsors, and since it is connected to Uber with its APIs, Leasy is able to check the background and review historical drives and whether they have tickets.

Leasy plans to use the data it collects within a predictive analytical model to estimate when people can happen automatically. On the consumer side, they can provide insight into how well they drive, how much fuel they have and how much they spend on fuel.

“It helps them maintain a good track record and make sure they have all the information they need to do a good job and are at least two steps away from earning money,” he added.

In fact, Garay told Referus that Leasy has so far seen 1% churn, or automatic.

“We are very flexible compared to the bank, and we want him to succeed,” he said. “It says they get in a car accident and can’t work for ten days, we don’t charge them then.”

To date, the startup has signed up for more than 370 loan contracts and has a waiting list of more than 1,500 people. The funds will be used to help the company and help it grow out of its home country of Peru, starting with Mexico and moving to markets such as Colombia and Chile.

Nathan Lustig of Magma Partners believes that Leasy solves the “real problem” of Latin Americans who are trying to achieve what belongs to many of their great assets.

“The car can help bring Latin Americans to the middle class, and the owner of the car can use it to earn 30% more money for their families,” he said. “Traditional financial institutions ignore a large number of Latin Americans.”

The “big” start-up technology, distribution, customer service and clusters combined with a “very strong” economic unit have made it an attractive investment, adds Lustig.

“They follow the pattern of successful founders who started out in neglected Latin American markets such as Peru, Ecuador, Chile and Uruguay who may have had the potential to spread to major Latin American countries,” he said.

Last August, Referus reported on $ 104 million promotion of the Brazilian star Kovi, who has a similar career with Leasy.

The car also works a registration model on the basis that most people in Latin America will work for boarding companies if they are able to use the required vehicle.