London-based private equity company Smedvig Capital has invested GBP6.4 million in Streetcar the UK’s largest pay-as-you-go car club.
London-based private equity company Smedvig Capital has invested GBP6.4 million in Streetcar the UK’s largest pay-as-you-go car club. The new capital will be used to finance Streetcar’s aggressive growth plans, substantially increasing the number of locations and the size of the fleet whilst ensuring it maintains its very high levels of customer service.
Streetcar is the UK market leader in this rapidly growing concept providing a highly flexible, convenient and cost-effective alternative to car ownership. Club members book a car online or over the phone as little as 30 minutes ahead of time and use remotely activated smartcards to unlock the vehicle, which is typically within three minutes walk. At the end of the journey the car is returned to a dedicated Streetcar parking space and a travel log is automatically sent to Streetcar. Cars start from £4.95 per hour with the first 30 miles of petrol free. The cars are available 24/7 for rent by the hour, day, week or month.
Pay-as-you-go car clubs are increasing in popularity across major cities in Europe and the US, as they bring a number of environmental, socio-economic and financial benefits, including:
- reducing the number of cars on the road and consequently cutting carbon dioxide emissions
- reducing the need for private ownership of cars and the financial outlay that entails
- tackling other issues like labour market mobility
Streetcar currently operates in London (where it is market leader with an 85% market share), Southampton and Brighton. The company has more than 10,000 members, a figure which has tripled in each of the last two years and continues to grow at the same rate.
‘The reasons we invested in Streetcar are clear,’ says Johnny Hewett, Chief Executive of Smedvig. ‘It is the UK market leader with a strong brand, a proven management team and exceptionally high levels of member satisfaction. We are not surprised that take up for its service has been so rapid and we believe this trend is set to continue.
‘In addition to the very considerable convenience and economic benefits it provides to its members, it provides obvious environmental and congestion benefits at a time when we are all increasingly aware of the need to act on those issues.’
Andrew Valentine, co-founder of Streetcar added: ‘With membership growing so rapidly, there was a clear opportunity for an ambitious expansion plan. With Smedvig’s involvement we can now put this in place and make Streetcar available to a far wider market whilst further enhancing rather than compromising the customer experience. We are confident we can build on the success we have already achieved and are looking forward to having Johnny and Rob on board.’
This is Semdvig’s third investment in the transport management arena. Other current portfolio companies in this sector cover vehicle leasing, fleet management, vehicle security and traffic information.
