SoftBank’s Vision Fund has invested $561 million in Auto1.
On Monday, Auto1, a German used-car dealing platform stated that having received an investment of $561 million (460 million euro) from Japan’s SoftBank, the pressure to tap revenues through an initial public offering (IPO) for its pan-European growth plans, has eased significantly.
The SoftBank Group, invested the sum through its Vision Fund, valued Auto1 at 2.9 billion euros and supports the auto trader’s international designs.
Berlin-based Auto1 stated, the amount invested by SoftBank was roughly the amount it hoped to raise through a stock market flotation.
“That’s why we aren’t considering going to the market for now,” said Hakan Koc, co-founder of Auto1.
The Financial Times was the first to report the investment by SoftBank’s Vision Fund.
Founded in 2012, Auto1 buys cars using its vehicle pricing database to calculate an offer within minutes after which it sells the vehicles to one of its 35,000 dealerships for a commission.
Virtually unknown to consumers, except through its used car buying arm Wir Kaufen dein Auto (We Buy Your Car) in Germany and similar names elsewhere, Auto1, operates in Portugal, Finland, as well as in 30 other countries, other than Britain.
Founded by Berlin entrepreneur Christian Bertermann, Auto1 came into existence when he faced trouble selling two old cars owned by his grandmother. Bertermannalong with Koc, who previously worked at Rocket Internet-backed firms Zalando and Home24, founded Auto1.
Competitors include Emil Frey AG, vehicle distributors from Switzerland and AVAG Holding SE, from Germany; U.S. based car rental giants Carmax and Mannheim are also its competitors.
Auto1 stated it sells more than 40,000 cars per month. In 2016, Auto had revenues that totaled 1.5 billion euros.
Following the new funding from SoftBank, Auto1 has raised more than $1 billion in outside financing.
Akshay Naheta, a partner at SoftBank Investment Advisers, will now join Auto1’s supervisory board.