SANTA MONICA, Calif., Aug. 27, 2019 /PRNewswire/ -- Vehicle subscription app Fair today announced it has closed a $100 million debt facility and an equity investment as it expands its relationship with Ally Financial. The debt facility, provided by Ally Bank to a subsidiary of Fair, is designed to help the fintech startup secure vehicles for entry-level car customers who might not otherwise qualify for a traditional loan or lease.
Ally joins Fair's list of credit providers, which include: Credit Suisse, Goldman Sachs and Silicon Valley Bank. The Ally facility and investment come on the heels of Fair's SoftBank-led $385 million Series B last year, which included investments from Exponential Ventures, Munich Re Venture's ERGO Fund, G Squared, Expanding Capital and CreditEase.
Fair and Ally initiated a strategic alliance in 2018 that includes Fair using Ally's SmartAuction and Clearlane tools to manage vehicle inventory and provide customer access to an alternative to traditional financing channels. Under its pilot program in Southern California and South Florida, Fair is using Clearlane, Ally's digital financing platform, to help consumers who can't otherwise secure traditional financing. Fair is also using Ally's digital wholesale auto auction tool, SmartAuction, to acquire and remarket vehicles.
"Ally is an important strategic partner to Fair, and deepening the relationship represents the type of strategic alliances that are at the cornerstone of building a hyper-growth company like Fair," said Scott Painter, Fair Founder and CEO. "Through this partnership, Ally provides us with a foundational strategic building block and gives us access to an important source of capital to scale our solution and meet the ever-changing needs of the modern car shopper."
Since launching in August 2017, Fair has provided cars for more than 45,000 users in more than 30 markets across the United States. Fair is an app that puts the entire end-to-end process of getting a car on a customer's phone. Qualified users can shop pre-owned cars based on all-in monthly payments they can afford, sign for the one they want with their finger, pick up their keys and drive it for as long as they want—with no long-term commitment, debt or even physical paperwork.
"We're excited about the future of our alliance with Fair and look forward to taking it to the next level with continued investment in its groundbreaking subscription model," said Dinesh Chopra, Ally's Chief Strategy Officer. "Fair is transforming the way consumers get and access pre-owned vehicles, and we are eager to be a growing part of a new flexible, completely digital solution that supports both consumers and dealers."
"This deal is the latest evidence that institutional debt markets are highly receptive to the way Fair is transforming vehicle financing," said Georg Bauer, Fair Co-Founder and Chairman. "It's clear we'll be able to continue to access the capital we need in order to connect dealers and consumers through a fully digital end-to-end experience."
Fair offers a new way to get a car that responds to consumer demand for more freedom. Fair gives customers the flexibility to drive the car they want for as long as they want and lets them walk away any time, eliminating the long-term commitment of traditional financing or leasing. Fair allows you to select your car, miles and view your payments—all in a mobile and paperless end-to-end experience that's simple, transparent and affordable. Fair is headquartered in Santa Monica, California. For more information, please visit www.fair.com and follow on Twitter at @fairtheapp.
About Ally Financial Inc.
Ally Financial Inc. (NYSE: ALLY) is a leading digital financial-services company with $180.4 billion in assets as of June 30, 2019. As a customer-centric company with passionate customer service and innovative financial solutions, we are relentlessly focused on "Doing it Right" and being a trusted financial-services provider to our consumer, commercial, and corporate customers. We are one of the largest full-service automotive-finance operations in the country and offer a wide range of financial services and insurance products to automotive dealerships and consumers. Our award-winning online bank (Ally Bank, Member FDIC and Equal Housing Lender) offers mortgage-lending services and a variety of deposit and other banking products, including savings, money-market, and checking accounts, certificates of deposit (CDs), and individual retirement accounts (IRAs). Additionally, we offer securities-brokerage and investment-advisory services through Ally Invest. Our robust corporate finance business offers capital for equity sponsors and middle-market companies.
For more information and disclosures about Ally, visit https://www.ally.com/#disclosures.