INSUBCONTINENT EXCLUSIVE:
Grover, the Berlin-based startup that offers &pay-as-you-go& subscriptions to the latest consumer tech as an alternative to owning products
outright, has raised €37 million in funding.The Series A round is led by Circularity Capital LLP — a VC that specialises in the
so-called &circular economy& — with participation from fintech investor Coparion, Samsung NEXT, and Varengold Bank
Existing investors, including Commerzbank Main Incubator, also followed on.Noteworthy, the funding consists of €12 million in equity and a
new €25 million debt facility
Building an inventory of new tech products to rent is quite capital insensitive, after all.Targeting Germany only, for now (after
and pausing a soft launch in the United States ), Grover wants to be something akin to Netflix for gadgets
It offers individual tech products by monthly, three-monthly or yearly subscription, or via its newly launched &Grover Mix& subscription,
which has a fixed monthly price and lets you switch item at any time.In addition, you are afforded some upside protection, should you wish
to purchase the item after renting it first
You&re given the option to buy products with 30 percent of your subscription payments to date being deducted from the recommended retail
For longer rental periods, Grover will also warn you if you are close to reaching 130 percent of the full purchase price and prompt you to
consider buying it for €1.The startup has also been trialling a B2B product aimed at burgeoning companies, dubbed &Startups get Grover&
This I&m told came about after demand from startups who, for example, want to subscribe to a bunch of MacBooks to give to new employees, and
as an alternative to deploying upfront capital.In a call with Grover founder and CEO Michael Cassau, he told me the new capital will be used
to expand the company market leadership in Germany and re-boot international expansion in a bid to continue a current revenue growth rate of
He said the startup had taken the decision in early 2017 to focus on Germany, temporarily abandoning internationalization, after it had
signed a major partnership with German e-retailer MediaMarkt
It has since also partnered with Saturn, Gravis, Conrad, and Tchibo.This sees Grover become a checkout option, alongside other payment
buttons or financing offers
That way a customer can choose to rent a tech product via their favourite online store powered by Grover
Behind the scenes, Grover actually buys the product from the retailer, having put agreements in place with regards to what products fit the
Grover model and aren''t already overstocked by Grover.Alternatively, in some instances, Grover has a &re-circulation& deal in place so that
a retailer can continue offering Grover as an option even if Grover has enough inventory already, and instead take a share of future
This works particularly well for slightly older products or items that are diminishing in popularity.In addition to growing in Germany and
future international ambitions, Cassau says that the startup plans to invest in the user experience of Grover, suggesting that it has room
This will include developing &new and innovative usage models,& while he also conceded that with further scale the company can get more
customer aligned in terms of the products on offer and its subscription pricing.At some point, if Grover subscription model becomes
compelling enough, it hoped that purchasing many tech products will become so unattractive as to create Netflix-level changes in consumption
Or, at least, that the aim
In my case, that would mean spending far less time recycling things like smartphones and music technology gear on eBay as I tread a
well-trodden and perpetual upgrade path.
