Finn, a Munich-based startup that offers new car subscriptions as an alternative to buying or leasing, has raised a large round of growth funding to expand its tech and reach, including electric vehicles and cloud-based service management. With 25,000 customers in Germany and the U.S., the firm received €100 million ($109-110 million) in a Series C that values it at €600 million post-money ($658 million at current prices).
Sustainability-focused European growth equity company Planet First Partners is heading the deal. Finn aims to have 80% of its vehicle inventory electrified by 2028, up from 40% presently, because of its environmental focus.
“The transition to electric vehicles is one of the major societal shifts taking place globally and is crucial in our move towards a more sustainable economy,” Planet First Partners managing partner Nathan Medlock said. Road travel accounts for one-sixth of global emissions, making electric cars essential to decarbonizing civilization. This round adds him to the board. 
Former backers HV Capital, Korelya Capital, UVC Partners, White Star Capital, and Picus Capital are involved. Finn has raised $250 million in stock and $1 billion in debt on a rolling basis, paying them back depending on vehicle sales.
The automobile subscription business has had a rough ride. High-profile firms like Fair.com raised hundreds of millions before failing and shifting. Onto, a major European player, declared bankruptcy in September 2023. After acquiring two automobile subscription firms as part of its expansion plan, Cazoo shut down the operation in 2023 to avoid bankruptcy.
Though clever, automobile subscriptions are poorly executed. Boston Consulting called it a “passing fancy—a product in search of demand.” That’s led to poor unit economics and unknowns about who will desire subscription vehicles in the future.
Finn’s CEO and co-founder, Maximilian Wühr, believes that his company’s relatively late entry into the market—it was founded in Germany in 2019 and expanded into the U.S., its only other market, in 2022—has given it better insights into what hasn’t worked for others to help it avoid the same mistakes.
The firm offers new automobiles, which make up 97% of its inventory, on 12-month subscriptions (longer than a rental, shorter than the ordinary lease), Wühr noted.
New automobiles are bulk-purchased from OEMs. Users can choose from 350 setups, but they can’t alter them. It has prearranged with auto sellers to purchase back cars after subscriptions.
It sells to individual consumers and corporations that will buy multiple cars for their employees, but it doesn’t enable ride-hailing.
All-in monthly prices include insurance, tax, and technical inspection (but not maintenance) for the cars. Popular versions cost €430–€1,200 per month.
He added that the effort has resulted in yearly recurring sales of €160 million across the two countries, including €150 million in Germany. Finn may not be profitable, but “the core product is profitable,” implying it has worked out unit economics better than some of its competitors.
Finn already uses data analytics to determine what customers want to drive and how much they’re prepared to spend.
Its e-commerce platform is designed for efficiency. The company optimized the car-buying process to avoid the same shopping cart abandonment issues that e-commerce retailers face. Too many obstacles to buying what they want online usually lead to people changing their minds and leaving sites.
He remarked, “You can order the subscription in less than five minutes, and it gets delivered to your doorstep within days.”
Wühr said the company wants to make its app a richer and more “seamless” experience for auto subscribers to switch vehicles, contact customer support, purchase additional services, and more. He said it aims to remove humans from the loop as much as possible to cut support costs in service-based models.
“We want to make sure the companion app works really, really well for subscribers,” he added. “Whenever there is a car issue, you basically won’t need to talk to a human again.”
The corporation is also attempting to capitalize on the linked vehicle revolution, albeit slowly. Although the goal is to have better real-time diagnostics about how much its customers are driving cars and to possibly build services they can use as subscribers, Wühr said that not enough of its fleet has the facilities to manage that, and those that do usually have proprietary systems, in a useful or cost-effective way for Finn to implement it.
Finn’s U.S. growth is newer and smaller, so it will be interesting to see whether it can scale up there as well as in its home market. Wühr noted that in Germany, it has excellent OEM partnerships for car procurement and covers more than 80% of the most popular makes and models (up to 30 brands). He noted that OEM negotiations have been slower to lead to sales in the U.S.
“The U.S. is working really, really well from a consumer perspective, but it is a little bit harder to get to the right OEMs, and since you need more scale, it makes it a harder market to kind of get into,” Wühr said.
