Sydney-based vehicle parking solutions startup Divvy has secured an AU$2.5 million (US$1.7 million) Series B investment from unnamed investors in Australia and Hong Kong.
The transaction brings total equity financing raised to $3.7 million. Prior financing includes a $1.7 million Series A preceded by a seed round in excess of $200,000 in 2013.
The Divvy app gives drivers access to commercial buildings by releasing a code that can be entered into a touchscreen when drivers approach the buildings’ car parks. Using Divvy’s app, which functions as a digital market place for parking spaces, users can access a partnered car park, via entering a code provided by the app.
Currently, Divvy’s business models revolves around renting out under-utilised spaces in commercial buildings in the Australian cities of Sydney, Melbourne and Brisbane by the hour, charging between A$4-A$10 per hour of parking. This is less than the rates charged by Wilson Parking.
According to the Divvy, it plans to deploy the capital to expand its parking networks in central business districts (CBDs) across Australia, following a successful pilot project in Sydney. It is also targeting expansion in Asian markets, with a focus on China. In addition, it has appointed Australian businessmen Steven Vamos and Peter Gammell to its Advisory Board.
In May 2014, it added former Microsoft executive James Simpson as its CTO and director. Commenting on the investment, Nicholas Austin, CEO and founder of Divvy, said, “We are now looking to capitalise on a number of opportunities that will scale Divvy globally, and maintain momentum and market share in the local commercial property market.
Divvy has made these strategic additions in the aftermath of securing partnerships with commercial property groups such as DEXUS Property Group, Knight Frank and GPT Group, who are parking asset owners and managers that see collaboration with Divvy as contributing to improved revenues.
Austin explained: “We’re currently eyeing Asia for international expansion, particularly China, where car ownership is expected to grow by roughly 10 per cent per year and congestion issues continue to plague major cities. Divvy Parking has been in partnership discussions with a number of large players in the Asian commercial property market and we’re excited about what 2016 has in store for us.”
Seeking to replicate the success of its strategy in Hong Kong, as Divvy scales it will need to adapt to local market and transport challenges across various cities in China. This includes understanding the needs of commercial property owners, managers and the overall transport system, and building solutions to suit their needs.