Social Auto Transport, a platform dually based in Richmond and Charlotte that helps automotive companies move vehicles more efficiently, closed on a $1.5 million seed round today.
The round was led by Overline, an Atlanta-based seed-stage venture capital firm, with additional investments from Automotive Ventures, Estes Express Lines and Kevin Nolan, founder of Nolan Transportation Group and OTR Capital. Since its founding, Social Auto Transport has raised more than $2.7 million, said co-founder Nick Mottas.
Mottas said the $1.5 million will be used to help the company continue to scale. Beginning today, Social Auto Transport officially launched operations in Philadelphia with plans to expand to Atlanta, Washington, D.C. and three other cities over the next six months.
"We're talking to some national partners and dealership groups, and we're looking at Nashville, Dallas, Houston and Phoenix as potential locations," he said. "Our goal is 30 markets over the next couple of years."
Mottas and longtime friend and colleague Rob Newton founded the startup in Richmond in 2018 and expanded operations to Charlotte just one year later.
The pair met working in the IT department at a well-known trucking company, and several years later, when Mottas left for a job at a large-scale used car retailer, he recruited Newton to join him there.
While working for that company, the pair began to brainstorm a better way to move vehicles, Mottas said.
"(Newton) and I set out to solve the problem of how to move a car quickly and still be economical," he said.
In early 2018, after securing a $900,000 investment, Mottas and Newton left their jobs to run the company full time.
The startup is a gig economy platform that facilitates moving cars for automotive dealers, repair shops, fleets and retail agencies. Mottas said the idea was to build a marketplace that provides these companies with a reliable short-haul service for when they need to move inventory, make operational moves and provide concierge pickup and delivery services to their customers.
Social Auto Transport found a home as one of Startup Virginia's first tenants, and, as a result, Mottas and Newton were introduced to the founder of transportation startup CarLotz, Michael Bor.
"(Bor) quickly said yes to working with us, and we moved our first car on July 31, 2018," he said. "By the end of the year, we owned all of CarLotz's vehicle moves in the Richmond region."
From there, the platform took off. Mottas said with paid drivers on board, they pitched the concept to their former employer. By March 2019, Social Auto Transport was moving all of its vehicles in the Richmond region, too.
Mottas said when they were ready to scale that fall, Charlotte was on the short list for expansion for several reasons. Currently, Social Auto Transport has about 20 drivers in both Charlotte and Richmond.
"We were looking for a market larger than Richmond ... Charlotte is on the bottom end of a large market, but really, it was the proximity to Richmond that attracted us, and it's a great car city," he said. "The largest fleet company in the U.S. was our first (in Charlotte). That showed we had the chops to pull national accounts."
The company also secured a partnership with ride-share platform Lyft. Through the partnership, Social Auto Transport's app will automatically send out an alert if one of its drivers needs a ride post-drop off.
"When our driver swipes in our app that they've arrived at the delivery location, it kicks off a work flow and arranges a ride through Lyft to take the driver wherever they need to go next," Mottas said.