Spiffy poised to expand on-demand car-servicing business after raising $22M
Spiffy, the on-demand car-servicing startup, has raised $22 million in a Series B round from investors, the company said Tuesday.
The financing was led by Tribeca Venture Partners, a New York-based venture capital firm, and included several industry partners, such as the investment arms of both the tire maker Goodyear and the oil company Shell. Local investors Bull City Venture Partners also invested in the company.
Founded in 2014 by former ChannelAdvisor CEO Scot Wingo, Spiffy initially focused on providing mobile car washes to customers in the Triangle, mainly at the region’s numerous office parks.
But the Durham-based company has since expanded into dozens of markets and added services like oil and tire changes and some maintenance work. Previously, the company had only done tire changes and rotations in the Raleigh area, but it will expand that service to all of its markets following the latest injection of capital.
Spiffy’s main customers are rental companies and corporate fleets, which make up around 80% of the company’s business, Wingo said.
In an interview, Wingo said the new money will be used to expand Spiffy into more markets and hire workers. Wingo said the company currently has around 400 mobile technicians and is hoping to add another 200 in the next year.
The company said it does around 2,000 daily services in 36 markets, such as Charlotte, Dallas and Los Angeles. Spiffy declined to reveal its valuation or its revenue numbers.
Much of its recent expansion has been fueled by acquiring several competitors. In 2019, Spiffy acquired the Florida-based Your Location Lubrication, in a deal that more than doubled its size. And earlier this year, Spiffy bought a company called Pit Crew, giving it a foot hold in three markets in Tennessee.
Wingo said Spiffy is also inking several franchise agreements as another way to expand across the U.S. Going forward, it will likely use franchise agreements to expand into markets with fewer than a million residents, like it has in Greenville, S.C.; Charleston, S.C.; and Wilmington, Wingo said.
Rebounding after pandemic
The expansion comes after Spiffy’s business initially contracted during the pandemic. With offices emptied and few rental cars being used, demand for its services plummeted. The company raised money via a convertible note last year to help it weather some of the decline.
But business has rebounded.
“Growth has started to accelerate again, and it has surpassed where we were before the pandemic,” he said.
In fact, the pandemic is now directing some positive trends its way, Wingo said.
Both rental and corporate fleet partners are keeping cars longer because of shortages in vehicle manufacturing. That is leading more maintenance on their current stock of cars, Wingo said.
Additionally, many firms are also trying to cut down costs and contracting work to Spiffy rather than employ their own maintenance teams, Wingo added.
“It’s a bit of a perfect storm of events that are creating a surge in demand,” he said.
This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate
This story was originally published October 26, 2021 at 7:00 AM.
