Glasgow motor finance provider uses major funding to drive into used EV market
A Glasgow-based motor finance provider is powering into the used electric vehicle market thanks to a major funding injection.
A £292 million securitisation, listed on the London Stock Exchange, has created the financial firepower for Startline to embark on its next ambitious phase of expansion.
The move has seen the company float around three quarters of its existing debt book under the name Satus - Latin for start - in order to open future funding sources, including a £400m committed facility from banking giant JP Morgan over the next 18 months.
Founded eight years ago, Startline is a specialist in “near-prime”, or nearly new, motor car finance and employs some 160 people at its Skypark headquarters in the city. It works with around half of the UK’s top 50 franchise dealers by turnover as well as 70 per cent of the top 50 independent car retailers.
Chief executive Paul Burgess said: “Our medium term aim is to take around 3 per cent of the entire used motor finance market, up from just over 2 per cent currently, and this exercise is designed to place us on a sound footing to achieve this ambition.
“The securitisation attracted around 20 investors and was significantly oversubscribed, which is something of a rarity and a testament to the quality of business that the team here in Glasgow is writing.
“Notably, we can now move into electric vehicle funding, which was closed to us under our previous funding arrangements, but is clearly a key element in future growth. The business is now in an ideal position to further expand.”
He added: “We have spent 2021 undertaking a number of initiatives designed to support our growth strategy. Importantly in the current market, investment in technology designed to support both dealers and car buyers, who increasingly purchase online, has continued.
“Also, we are keenly aware that retaining and attracting the right people has become more difficult now, and have launched a new training initiative, the Startline Academy, as well as providing mental health support to staff through our relationship with a company called Sanctus and app-based meditation through Calm.
“Additionally, next year, we are embarking on a programme of diversity and inclusion training, working with leading specialists, Vercida.”
The firm said it was embarking on a new scheme to plant a tree for every motor finance deal it writes, as well as other initiatives in the environmental arena.
“This thinking is very much in support of the used car market’s move towards electrification and a general shift towards a net zero future,” Burgess added.
Last month, the firm announced that it was taking on additional staff as used car demand continues to boom, largely due to a shortage of new vehicles amid semiconductor supply issues.
Startline said ten employees were being added to the company’s origination team, based at its SkyPark base, to handle increased levels of business. Like all the firm’s staff, the new recruits will be given the option of a hybrid working model amid ongoing measures to try to control the spread of coronavirus.
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