Carzami, an online retailer for quality used cars and vehicle financing has closed an undisclosed pre-seed round led by Contact Financial Holding, together with a scalable inventory financing facility, which it plans to use to transform Egypt's used car market targeting $30 million in revenue by 2024.
With this strategic investment from Contact, Egypt’s largest non-bank financial services provider, Carzami is positioned to launch its innovative model for a digital car dealership while being able to offer crucial vehicle financing and insurance options.
Co-founded in 2022 by Hussein Hosny and Adham Hosny; 2 seasoned entrepreneurs in the automotive space, the mobility fintech company aims to fix the Egyptian used car market by providing consumers with an online platform offering certified and reconditioned used cars with 360-degree virtual tours and inspection reports. Customers can order any car they like to be delivered to their doorstep to test drive, and then purchase with financing and insurance options.
Egypt is home to one of Africa's largest vehicle fleets, with over 6 million cars (80% are passenger cars) on its roads. According to this finding by Ken Research, most are used cars; their ratio to new vehicles is 3:1. But the used cars market isn't only enormous in Egypt; it is in almost every country with a large population globally.
Recently, Cairo-based Sylndr secured a $12.6 million pre-seed—arguably the largest of its kind in MENA and sub-Saharan Africa—to enable financing and make the cars much more affordable to people. In May 2022, Nigeria's Autochek acquired Morroco's KIFAL Auto to drive its expansion into North Africa to play in the MENA market.
In a statement shared with Benjamindada.com, the Carzami Founders, Hussein Hosny & Adham Hosny said that "we aim to change the way people buy and sell used cars by providing a seamless one-stop-shop platform that offers online buying, selling, and high-quality financing options. Our experience is all about trust and transparency, allowing consumers to overcome the hassle of traditional dealerships."
Both Hussein and Adham boast extensive experience in the automotive space. The duo co-founded Sa3ar; Egypt’s first data pricing engine for used cars, in partnership with Synapse Analytics, which is now also a partner in Carzami. With additional team experience from BMW, Mercedes, and Porsche, Carzami is gearing to be an industry leader for car needs and requirements across the region
Related Article: Vehicle financing in Africa amidst the Russia-Ukraine war
With the funding, Carzami seeks to continue growing its inventory. Along with that, Carzami is looking to expand its fleet of delivery hauliers, enhance its operational technology, build a productive team, and build a modern reconditioning facility. Importantly, the company will utilize the funding in optimizing its organizational efficiency and building on the existing functions, such as vehicle financing.
Carzami hopes to gain an advantageous edge over its competitors by providing exceptional services and building on its consumer trust. This will be achieved by premiering the 30-day Carzami Protection Program and a 7-day “Test to Own” service where potential buyers can try out a vehicle for 7 days/200km to reach a conclusion. Ultimately, they can get a full refund or trade in with another. Here, Carzami aims to ensure that consumers get value for their money. Carzami seeks to become a pioneer in the used car industry by offering consumers top-of-the-line services.
Hazem Moussa, Chairman of Contact Financial Holding, stated that "Our faith in digitizing the automotive market in Egypt has been with us from our early years, we launched contactcars.com in 2002 as the first car marketplace and community for both new and used cars. In addition, Contact pioneered financing of used cars over 10 years ago, now we believe we can support Carzami in its quest to re-invent the used car purchase experience".