By Navneeta Jha 
As people become increasingly concerned about the environment and what we as humans are doing to dirty it, a growing number of individuals are looking for ways to live more sustainably. Grover, a company that has built a business around one aspect of this—enticing people to buy and eventually discard less consumer electronics like phones, monitors, and electric scooters by offering them attractive subscriptions to use their stock of new or used gadgets—has announced a large round of funding to expand its business.
The Berlin-based firm has raised $330 million in total, with $110 million in equity and $220 million in debt, which it intends to use to expand its device stock as it prepares for further user growth.
Co-Investor Partners, Korelya Capital, LG, Mirae Asset Group, and previous backers Viola Fintech, Assurant, and Coparion are heading the equity portion of the Series C, with previous backers Viola Fintech, Assurant, and Coparion also participating. The debt is provided by Fasanara Capital. The debt-to-equity ratio is common for a firm growing a leasing business, and it’s the same strategy Grover used to fund $71 million for its Series B round a year ago.
Grover is valued at over $1 billion, according to the corporation.
Grover has been steadily growing in recent years, according to CEO and founder Michael Cassau, who noted that the company’s footprint, which includes Germany, Austria, the Netherlands, Spain, and the United States, has grown at a consistent rate.
Grover has more than doubled its memberships and revenue in the last year, with half a million things accessible for subscription, 2 million registered users, and 250,000 active consumers (some of whom are subscribing to use more than one gadget). This expansion has been fueled by a number of market dynamics.
The first is a push for more sustainability and a new appreciation for the so-called “circular economy” approach, spurred not only by heightened awareness of environmental issues but also by a shift toward mutual support during COVID-19, when many people were communicating (sometimes for the first time) with those living nearby, sharing resources to get through the pandemic’s difficulties. Those resources were occasionally put to use in the production of commodities that were passed down or sold.
A second trend, a tightening in the global economy, which has driven consumers to contemplate spending less on some discretionary items, has accelerated this collective shift.
In an interview with TechCrunch, Cassau said, “We see ourselves as simplifying access to a chunk of your budget.”
And the idea of spreading out the cost of a commodity that has been used but is still in good condition appears to be more enticing now than it was previously.
“Even second and third-year products are in high demand,” Cassau remarked. “Some people want the newest products, especially new phones, yet a large number of people are content with an iPhone 11 or even an iPhone 8.”
You can see that in the secondary market as well, “he added, alluding to companies like Back Market (which raised a large round at a large value earlier this year) where customers can buy refurbished products. And it’s a trend that’s spreading to other industries, with Vinted (a Lithuanian used-clothing marketplace) currently valued at $4.5 billion. “It’s a massive industry that has even surpassed primary in some places.” Back Market, according to Cassau, is a major rival in the area.
On average, a product has four owners throughout the course of “many years,” but some itemsare outliers, with a GoPro camera in its stock, it said, circulated 27 times.
However, certain goods are outliers, with a GoPro camera in its stock being circulated 27 times, according to the company.
Grover started with — and still has — consumers as its primary customers, but it’s also seeing a growing interest in B2B, where some consumers are now subscribing to items they can use in their businesses, and businesses are starting to engage with Grover to purchase multiple devices to equip their teams, offices, temporary staff, and in general as part of a larger effort to reduce overheads and fixed costs.
Cassau described to me the startup’s “embedded finance” products, which are financial services it delivers alongside its subscription company, which Grover has taken over.
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