Kyte Secures $200 Million Asset-Backed Financing Facility From Goldman Sachs and Ares Management to Grow Fleet Amid Unprecedented Transformation of the Transportation Industry

Rhea-AI Summary

Kyte, a car-on-demand service, has secured a $200 million asset-backed credit financing from Goldman Sachs and Ares Global Management to enhance fleet growth and margin expansion. This funding aims to support Kyte's vision of creating the largest electrified, autonomous fleet platform. As customer expectations evolve, Kyte is facilitating a shift from traditional car ownership to on-demand access, positioning itself for global expansion amid a transformative transportation industry. This investment will enable the integration of new vehicle models and support the transition towards electric fleets.

Positive

• Secured $200 million asset-backed financing to enhance fleet growth.
• Aims to become the largest electrified, autonomous fleet platform.
• Supports transition towards a tech-driven, customer-centric transportation solution.

Negative

• None.

Funding will aid the leading car-on-demand company in monumental city expansion as they become the largest electrified, autonomous fleet platform to serve the global trip economy

SAN FRANCISCO, March 24, 2022 /PRNewswire/ -- Kyte, the company pioneering cars delivered to you on-demand, today announced the closing of an asset-backed credit financing of up to $200 million from Goldman Sachs ("Goldman") and the Ares Global Management ("Ares") Alternative Credit Team to accelerate the company's fleet growth and margin expansion. Kyte and its financing providers will create a more robust trip economy that services a more demanding customer with a shared vision of an electrified, autonomous future.

"We are building a real business with real assets in the real world. To get this right, we needed a debt capital provider that shares our ambitious vision and can put real money behind it. The credit facility from Goldman and Ares will catalyze our growth as we build towards the future of transportation," said Ludwig Schoenack, Co-Founder of Kyte. "The problem Kyte is solving is giving access to cars to people that live in cities. These cars are a core element that we wanted to get right, and we're committed to being a leader in customer-centricity and technology-powered operational excellence." 

In recent years, customer expectations have drastically increased, as more convenient on-demand options have replaced brick and mortar incumbents in the grocery, restaurant, and FMCG spaces. Building on the same set of hypotheses, Kyte is creating a more accessible solution for people to get cars on-demand and bridging the massive gap between elevated consumer expectations and frustrating existing experiences. An end-to-end product, Kyte is redefining transportation by delivering and retrieving cars, bypassing the inconveniences of car ownership, car leasing, and the familiar hassles of traditional car rental. This paradigm shift eliminates the need to own a car to experience the benefits of individual vehicle travel.

The next ten years will bring about a dramatic shift in vehicle sales towards electric fleets. Government investments will also trend in this direction, with the US DOT putting $5 billion into EV charging networks. Taking things one step further, autonomous technology will begin to move to the forefront and, once widely available, will create even more efficient and convenient options. As a result, Kyte will regularly integrate new vehicle models into its fleet, and this funding ensures the capital to evolve with the industry while expanding upon its tech-forward product offering.

 "We are excited to support Kyte in its next phase of growth," said Felix Zhang, Managing Director in Ares Alternative Credit. "With a shared vision for the future of the transportation industry, this capital solution demonstrates Ares' focus on innovative businesses that are disrupting traditional business models."

Paving the way for a new understanding of mobility, Kyte has its eyes set on global expansion that not only delivers, but surpasses steep consumer expectations, through electric, shared, connected – and eventually, autonomous transportation.  

About Kyte
Kyte aims to give people better access to fewer cars and replace car ownership by offering access to cars on demand. The company's intentional approach increases vehicle utilization and takes cars off the road for a more sustainable future while saving customers time and money.

Through the Kyte mobile app on iOS, Android, or website, customers can book a car for a day, multiple days, multiple weeks, months, or however long they want. To begin, customers choose a time and location for their vehicle delivery. Then, the company dispatches a delivery driver — known as a "Kyte Surfer" — to deliver a clean, sanitized car at the time requested. When the vehicle is ready to be returned, a Kyte Surfer retrieves the car from the customer at the location and time they can flexibly choose.

Currently operational in over a dozen cities, Kyte was founded in 2019 by Nikolaus Volk, Ludwig Schoenack, and Francesco Wiedemann, and is headquartered in San Francisco, CA, with offices in Munich, Germany, and satellites across the globe. For more information about Kyte, visit their website, and for career opportunities, please visit their career page.

About Ares Management Corporation
Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager offering clients complementary primary and secondary investment solutions across the credit, private equity, real estate and infrastructure asset classes. We seek to provide flexible capital to support businesses and create value for our stakeholders and within our communities. By collaborating across our investment groups, we aim to generate consistent and attractive investment returns throughout market cycles. As of December 31, 2021, Ares Management Corporation's global platform had approximately $306 billion of assets under management, with approximately 2,100 employees operating across North America, Europe, Asia Pacific and the Middle East. For more information, please visit www.aresmgmt.com.

About Ares Alternative Credit
Ares' Alternative Credit strategy focuses on lending to and investing in assets that generate contractual cash flows and fills gaps in the capital markets between credit, private equity and real estate. Ares Alternative Credit targets investments across the capital structure in specialty finance, lender finance, loan portfolios, equipment leasing, structured products, net lease, cash flow streams (royalties, licensing, management fees), and other asset-focused investments. Co-Headed by Keith Ashton and Joel Holsinger, Ares Alternative Credit leverages a broadly skilled and cohesive team of approximately 50 investment professionals as of December 31, 2021. Aligning Ares' investment activities with its societal impact, Ares and Alternative Credit portfolio managers have committed to donating a portion of carried interest from certain Alternative Credit funds to global health and education charities.

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SOURCE Kyte

FAQ

What is Kyte's recent funding announcement?

Kyte announced a $200 million asset-backed credit financing from Goldman Sachs and Ares Global Management to expand its fleet.

How will the funding impact Kyte's business?

The funding will accelerate Kyte's fleet growth and margin expansion, supporting its vision of becoming a leader in electrified and autonomous transportation.

What is the significance of Ares' involvement in Kyte's funding?

Ares Global Management's involvement signifies a strong partnership aimed at supporting innovative businesses disrupting traditional models in the transportation industry.

When was the funding for Kyte announced?

The funding was announced on March 24, 2022.

What is Kyte's approach to car ownership?

Kyte aims to replace traditional car ownership by providing on-demand car access, eliminating the need for ownership.