Car-share startup Kyte surfs to $60M Series B
Kyte, a car-share startup, raised $60 million in a Series B round that closed Monday, the company exclusively tells Axios.
Why it matters: Car-share startups have come and gone, and Kyte's goal of integrating EVs into that model only creates more complexity.
Details: Led by InterAlpen Partners, other investors in the round include Valor Equity Partners, Anthemis, Citi Ventures, Hearst Ventures, DN Capital, 1984 Ventures, FJ Labs and Urban Innovation Fund.
- InterAlpen Partners founder Stephen George — who also invested in SpaceX and Tesla — will join Kyte's board as part of the all-equity deal. Kyte co-founder Ludwig Schoenack declined to share the round's valuation.
How it works: Kyte makes software that allows people to order a car for long-term rental via an app. The car is picked up and dropped off at the customer's location and the customer pays per use, though the startup is exploring a membership model for power users, Schoenack says.
- Goldman Sachs underwrote a $200 million asset-backed credit facility that Kyte taps to purchase all the vehicles it rents out.
- Kyte's goal is to entirely electrify its fleet of vehicles, but Schoenack says it is not currently feasible due to larger supply constraints around EVs. He says the company is still "aggressively" pursuing the strategy.
- Schoenack says the company is also evaluating how to build out a charging network as Kyte's EV fleet grows, noting that there is still not enough existing infrastructure, particularly in urban areas, to support broad EV adoption.
The bottom line: Car rental startups have long sold themselves as a lower entry point for new vehicles to OEMs, and Kyte's pitch is no different when it comes to EVs.
- Whether that pans out differently than companies past remains to be seen.