Online car-seller Canada Drives Ltd. is fuelling its national expansion plans with a strategic partnership that will provide the Vancouver company with $40 million in equity capital.
Goeasy Ltd. (TSX:GSY) will become a minority stakeholder for the vehicle sales platform after putting up the cash to be paid out in four installments.
The Ontario-based company is best known as a consumer lender but the Canada Drives deal, announced Monday, will see it become the platform’s preferred non-bank financing provider.
Canada Drives got its start helping consumers secure financing for auto purchases before launching its online sales platform in 2020. Customers can browse through an inventory of used cars, and then purchase a vehicle delivered in a trailer within a day of the sale.
Last year it raised $100 million in a funding round led by Honor Ventures as it sought to expand its operations beyond B.C. and Ontario.
It has since launched services in Alberta and Saskatchewan, and Canada Drives is now eyeing other provinces following the $40-million deal with Goeasy.
Canada Drives is not the only Vancouver company making moves this month in the realm of online auto sales.
Autozen Technology Ltd. announced last week it closed a seed round totalling more than $5 million for its platform that targets both drivers and dealers. The round was led by Vanedge Capital with participation from Anges Québec.
Users looking to sell can plug in their vehicle’s make, model and year, and Autozen responds with a range of prices for how much the automobile will likely fetch from dealers looking to acquire vehicles. The platform is free for consumers to use, while Autozen charges a commission to dealers for every vehicle sold.
The company previously raised $4.2 million in early 2021 and now plans to expand beyond the Vancouver market and into Toronto, Calgary, Edmonton and Seattle.
