Six-month-old Russian car service startup CarFix has raised $5 million A round as it prepares to enter the US market.

CarFix is a comprehensive online-to-offline auto repair platform, covering client experience improvement and algorithmic price setting, repair shop capacity management, spare part market optimisation while also providing an end to end online transaction capability.

The investment came from a consortium of Russian and international investors including a Russian IT giant Mail.Ru Group, European venture funds Simile Venture Partners and Kima Ventures and a private European investment fund PT Investments.

“Car service market has been barely touched by IT and internet technology. CarFix is setting up new standards for the car service industry, promoting transparency of the sector and increased financial gain for both car owners and car service companies alike,” said Tatiana Kim, managing partner at Simile Venture Partners.

CarFix says its prices are 20-40% lower than the market average. Since the launch in June over 300 car repair shops have joined the CarFix platform and over 4,000 car owners have become its satisfied customers.

“Investment into the CarFix platform is a unique opportunity to support the development of a service dedicated to creating significant value for families for whom vehicle maintenance and repair represents a substantial family budget expense. It is incredible that this market has not yet been revolutionised by the uberisation trends,” said Pavel Ermolaev, a director at PT Investments.

The startup will use the money on further deployment of the business model in Russia and preparation for international expansion and adaptation of the platform for the North American Market.  It aims to establish its first office in Los Angeles in the next six months.

CarFix sees a lot of similarities between Russian and US car service market as suppressed credit scores of the American sub-middle class consumers largely disenfranchise them from access to affordable auto leasing programs and acceptable auto loans, as well as fair vehicle insurance premiums that are based on driving records rather than credit scores.

“This leads to significant out of pocket cash flow during car purchases and results in great price sensitivity to keeping cars properly maintained and safe. CarFix business model allows the consumer prices to be reduced dramatically while maintaining the margins of CarFix auto shops,” it said.

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