Car subscription service Go, a startup founded about a year ago by Philadelphia-area transplant Michael Beauchamp, just raised $41 million to expand its vehicle offerings and service area.
The startup, which functions as an alternative to car ownership, launched last December and now operates in Pennsylvania, Delaware, New Jersey and Florida. Instead of visiting car lots, saving up for a down payment and thinking about resale value when picking a car, Go allows users to instead pay a monthly subscription fee for a vehicle. For Philly cars, for instance, monthly costs range from $819 for an X5 BMW to $239 for a Toyota Corolla.
There’s no down payment, and a user can end their subscription with 30 days notice. The startup’s inventory includes new cars starting at $230 a month, and it offers an insurance option so that a user doesn’t have to seek out third-party insurance. Go then delivers the car for free within 50 miles of the major airports in its markets.
The model is meant to be more flexible than leasing and car ownership, Beauchamp told Technical.ly, though Go users generally stick to a three-year timeline. (If they don’t, there’s a $495 restocking fee.) He said the startup’s current clients often come from leasing or previously buying new cars and they’re increasingly people who are getting comfortable making a car decision online.
Go’s raise, led by Synterra Capital Management, will allow the company to add to its current five-person team. Beauchamp said the VC firm had a good track record with other automotive-demand companies and it felt like the right fit for their growth plans into Georgia, North Carolina and Texas in upcoming months.
“We created Go to transform and simplify the experience of getting a car,” Beauchamp said. “This partnership with Synterra will accelerate our growth as we expand to meet customer demand in new markets.”
While there’s currently a few distributed team members, Beauchamp said they’ll be focusing hiring in the Philadelphia area, hoping to get to around 30 employees next year. There’s no HQ yet, though the company maintains space in Ardmore coworking space Suburban Square. The founder moved to the region last year as one of the thousands of people who made Philly home after leaving New York. While the area proved to have the demand for this business model, he said, it also feels like a great place to build a business.
Beauchamp is on his third venture, previously running a B2B outdoor advertising business in New York and founding a scooter company in Nashville. This time around, it feels far more exciting, he said.
“It’s a personal problem you are solving,” said Beauchamp, a car enthusiast. “It feels great to be creating a business you want to be a customer of.”