Y Combinator-backed Mecho Autotech has raised a $2.15 million in a seed round targeted at scaling connection of car owners to quality vehicle repair and maintenance providers.
The fund, which Mecho Autotech asserts to be oversubscribed by more than 300%, will enable the company to expand its multi-channel service capacity, engineering team, and marketing budget for B2C acquisition.
Investors in the seed round included Future Africa, HoaQ Capital, Cathexis Ventures, V8 Capital, Silver Squid and Tekedia Capital.
Founded by Olusegun Owoade and Ayoola Akinkunmi, Mecho Autotech has created a network of vetted in-house and third-party mechanics with the customer affordability (of businesses and retail customers) in mind.
The company has created a network of vetted technicians across 35 states in Nigeria to tackle the poor vehicle maintenance culture in the country. Added to this is the creation of an insurance plan that has an annual maintenance plan embedded, more or less substituting the after-sales package – automated maintenance plans for new cars – people with brand new vehicles typically get.
So far, Mecho Autotech has onboarded over 7,000 third-party mechanics across three workshops in Lagos servicing B2B customers: Shuttlers, Moove, Tolaram Group and Kobo. It charges about 15% commission fees –10% from service charges and 5% from spare parts charges.
The company 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.
Part of the seed money would go into expanding this capacity. It will also help scale Mecho Autotech’s mobile application, which it launched for its B2C customers last month. The two-year-old startup said it aims to reach 25,000 customers this year and charge them a monthly, quarterly or annual subscription fee.