Eagers takes 17.5% stake in Karmo as deal adds Simplr

Karmo has secured a strategic investment from Eagers Automotive, which will take a 17.5% stake in the car subscription business.

The deal also includes Karmo's acquisition of Simplr, a used-car subscription business founded by Eagers in 2020. The transaction links one of Australia's largest listed automotive retail groups with a specialist operator in the country's vehicle subscription market.

Karmo forecasts annual recurring revenue of AUD $60 million by June 2026 before integrating Simplr, which is expected to add about AUD $4 million. The business says it has grown nearly elevenfold over five years and about fivefold over the past three years.

The investment gives Eagers a direct holding in a part of the automotive market that has drawn interest from consumers and businesses seeking alternatives to car ownership and leasing. Karmo operates across consumer, business and novated subscription segments, with demand continuing to rise as customers look for more flexible vehicle access.

As part of its expansion, Karmo expects to buy more than 7,000 new vehicles and 450 used vehicles in 2026. The addition of Simplr is expected to broaden its reach in used-vehicle subscriptions alongside its existing new-car offering.

Growth plans

Founded in 2019 by Nick Boucher and Sam Zammit, Karmo has built its business around an all-inclusive vehicle subscription model and now employs more than 90 staff.

Boucher described the investment as an important step for both Karmo and the broader subscription segment.

"The investment from Eagers Automotive, along with the existing seed investment from Autoleague, is an exciting opportunity for us to accelerate the momentum already in the business and sector. Our 90-plus staff have built a business with meaningful scale in a category that is continuing to mature across consumer, business and novated markets. Eagers' investment gives us additional automotive infrastructure, fleet access and industry depth as we continue building the platform for flexible vehicle access nationally. We are all very proud of Karmo being one of the only subscription platforms in the world to have a sustainable business model that benefits the dealers, the OEM, Karmo and, most of all, the customer," said Nick Boucher, Chief Executive Officer and Co-Founder of Karmo.

Karmo has also been investing in systems for dealer operations. Its Karmo Connect service is designed to let dealerships offer vehicle subscriptions through their existing finance departments, while Karmo manages operational support, asset risk and ongoing customer management.

That model could have immediate relevance for Eagers, which runs a large dealership network across Australia and New Zealand. By taking an equity position in Karmo and divesting Simplr into the business, the group is combining financial exposure with a commercial relationship tied to dealership distribution and vehicle supply.

Dealer link

Eagers Chief Executive Officer Keith Thornton said the investment reflected the group's view of the market.

"Karmo has built a strong, scalable business with clear market momentum. They have developed real operational capability in a growing category, and we see clear strategic opportunity in supporting the next phase of their expansion," said Keith Thornton.

The transaction also highlights the role of Autoleague, Karmo's major shareholder and an earlier backer of the business. Tony Chong, Chairman of Autoleague, said the latest investment reflected the progress Karmo has made since launch.

"The journey of growth we have supported for Karmo has created immense value, and Autoleague takes great pride in the business it is today. Eagers Automotive's strategic investment serves as a powerful testament to the Karmo team's excellence, the platform's robustness and the substantial future potential available," said Tony Chong.

The structure of the deal suggests a broader shift in how car retailers are assessing recurring-revenue mobility models. Subscription services remain a small part of the wider automotive market, but established dealer groups are testing ways to participate without taking on the full operational burden of running those platforms internally.

For Karmo, backing from Eagers adds a strategic shareholder with deep access to vehicles, dealerships and retail infrastructure at a point when scale and fleet access are likely to matter more. For Eagers, the stake offers exposure to a business that says it has already reached profitability and built a national platform in a category that is still developing.

EM Advisory advised Karmo on the transaction process and strategic investment discussions.