Electric vehicle leasing company Onto has fallen into administration, following a drop in EV residual value and failing to secure additional funding from its shareholders.
Founded in 2017 by Rob Jolly and Dannan O’Meachair, Warwick-based Onto offered an electric car monthly subscription service to customers. The business had grown to have more than 7,000 EVs in its fleet by the start of 2023 and introduced more than 20,000 people to electric cars through the subscription.
The firm has struggled with the challenging economic climate with administrators citing “interest rates and the squeeze on disposable income” as major factors leading to the company’s demise.
The news comes after Onto secured more than £340m from investors to help its mission of pushing electric car adoption. It was also recognised by Deloitte as the fourth fastest-growing UK tech business in its Fast 50 list last year.
Legal & General invested £22.5m this year, after leading a Series C funding round in July 2022, which raised £45m in equity. At the time, L&G said Onto was “an ambitious company with a talented management team that will play a vital role in accelerating the transition to electric vehicles”.
$175m was generated in a combined equity and debt Series B funding round led by Alfvén & Didrikson on the equity raise, and asset manager Pollen Street Capital providing a senior-secured asset-backed debt facility in July 2021.
And in January, Onto raised a new credit funding line of £100m from global investment group CDPQ and Pollen Street, to expand its UK fleet with the latest electric car models.
Teneo Financial Advisory has been appointed as administrators for the holding company, as well as its subsidiaries. The administrators say they will maintain business operations with minimal disruption to customers, as they explore strategic options for the business
Gavin Maher, joint administrator said:
“Onto has suffered from the steep fall in electric vehicle residual value in the first half of 2023, rising interest rates and the squeeze on disposable income and was unable to secure additional funding from its shareholders.
“After entering administration, Onto will continue to serve existing customers as the administrators explore strategic options.”
