Mecho Autotech Raises $2.15m Seed For Vehicle Maintenance, Repair Services
A Nigerian vehicle repair and maintenance startup, Mecho Autotech, has announced the completion of a $2.15 million seed investment.
Future Africa, Hoaq Capital, Cathexis Ventures, V8 Capital, Silver Squid and Tekedia Capital participated in the round.
The round was oversubscribed by over 300% and is the largest investment to date for a vehicle maintenance startup in sub-Saharan Africa.
Mecho Autotech will use the capital to expand its multi-channel service capacity, engineering team, and marketing budget for B2C acquisition.
The Company operates a digital platform that connects B2B and B2C customers with in-house and third-party mechanics.
Mecho’s in-house capacity consists of workshops, known as Mecho Shops and Mecho Mobile operations.
To date, the Company has onboarded over 7,000 third-party mechanics to the platform with workshop and mobile operations.
To address the large and difficult task of servicing corporate fleets, Mecho has built three Mecho Shops across Lagos and will continue to expand this capacity.
Since its launch in April 2021, the Company’s B2B customers include some of Nigeria’s largest corporate fleets including Uber partner Moove, Tolaram Group, and UAC Group with several other notable SLAs in progress.
In addition to the growing B2B revenue base, Mecho has expanded into service for B2C customers with the launch of its B2C app in January.
The company aims to grow in B2C via a subscription service model and individual service requests with a target of 25,000 customers this year.
Moreover, Mecho is developing a spare parts value chain that has already served over 100 third-party mechanics and several large ticket inventory purchases for B2B customers.
Nigeria has over 12 million registered vehicles, and owners spend an average of $650 per year on maintenance and repairs.
Approximately 90 per cent of Nigeria’s car market consists of used vehicles with only 5 per cent of car sales financed.
Despite the sheer number of used cars on Nigeria’s roads which require check-ups to prevent breakdowns, regular vehicle maintenance is uncommon.
Existing service providers, the majority of whom are not formally trained and lack sufficient tools and equipment, are often inefficient and provide inconsistent service quality.
This year, many people will aspire to be better, build larger, earn more and grow bigger.
For us, we are on a mission to keep your wheels rolling.
That’s our new resolution.
— Mecho Autotech (@mecho_autotech) February 8, 2022
Founder/CEO of Mecho Autotech, Olusegun Owoade, said: “When you consider the state of Nigeria’s used cars and our roads, car maintenance isn’t optional. We want to automate high-quality vehicle repair and maintenance for Nigerians by making it easy, convenient, and affordable. We aspire to build a maintenance culture in Nigeria and beyond to keep roads and people safe.”
Future Africa, Founder and General Partner, Iyinoluwa Aboyeji, said: “At Future Africa, our thesis is to back founders solving hard problems in large markets. With over 12 million cars on our roads and more on the way, leveraging technology to bring order to vehicle maintenance and repair is overdue.
“We are delighted to work with the Mecho Autotech team as they brilliantly execute on building out the vehicle repair value chain across Africa and create new and decent highly skilled auto repair jobs.”