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Octane Announces Key Milestones in Advance of Continued Market Expansion

Octane (Octane Lending Inc.) announced a series of growth milestones it achieved in 2021 on its journey to provide the quickest and most trusted lending experience for powersports, outdoor power equipment and other passion purchases.

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Octane had a banner year in 2021. The company, through its lender Roadrunner Financial Inc., almost doubled loan fundings and grew fundings in its online direct-to-consumer channel by over 400%. Octane enrolled more than 440 dealers, increasing its dealer partners, to over 4,000. The company also signed five new original equipment manufacturer (OEM) partnerships, the largest being Polaris Inc. As a result, beginning this month, Polaris customers and dealers are now able to take advantage of Octane’s fast and easy digital lending experience to finance Polaris Sportsman, RANGER, RZR, and GENERAL off-road vehicles, Polaris snowmobiles, Indian Motorcycle and Slingshot vehicles.

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Building on its enormous success in streamlining the buying experience for powersports enthusiasts, Octane expanded its operational markets and began financing pontoons manufactured by BRP Inc., thereby enabling instant financing for the new 2022 Sea-Doo Switch in addition to Can-AM, Sea-Doo and Ski-Doo vehicles. Additionally, in the first half of 2022, Octane intends to enter into the trailer and tractor spaces, two key markets that can benefit from tech-driven purchasing and lending solutions.

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Due to the success of its business model, Octane attracted significant interest from investor partners. The company completed its Series D funding round at a valuation of over $900 million. Octane closed two securitizations collateralized by its fixed-rate installment powersports loans, including its largest securitization transaction to-date of $340 million, with senior tranche ratings of AA by Standard & Poor’s (S&P)1 and Kroll Bond Rating Agency (KBRA)2. The company also completed sales of residual certificates from its OCTL 2019-1, 2020-1 and 2021-2 deals, a testament to its strong performance both at the asset level and overall. Octane closed the year GAAP net income profitable and expects to continue the strong momentum in 2022.

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Over the past year, Octane ramped up hiring, growing its headcount by 80% from 263 to nearly 500, and expects to continue its rapid growth in 2022. As a remote-first company, Octane attracts talent throughout the country while growing its presence in its geographical hubs, including its newest office in Dallas and its headquarters in New York. Octane also appointed 24 key senior level hires across engineering, finance, marketing, product, risk and sales, and it added a business development team to help drive business momentum. Murali Vajjiravel, an ex-Amazon, ex-Microsoft executive joined Octane as chief technology officer in June 2021 and has led the growth of the technology team, doubling its size in just three months.

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The company launched a suite of new products to increase the speed and ease of financing a passion purchase. The first, Octane Prequal, is an ecommerce tool that enables OEMs and dealers to instantly prequalify customers directly on their websites. Since Octane Prequal uses a soft pull, it helps customers understand their buying power without impacting their credit score. The tool also speeds up the closing process by enabling customers to upload documents in advance. Octane Prequal is available for OEM and dealer partners and in select markets on Cycle World, one of Octane’s editorial brands.

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Octane also launched Safe Check, which partners with a leading consumer credit reporting company to allow dealers to view a customer’s bureau credit report without impacting their credit at no cost to the dealer; expanded coverage for front end accessories; and introduced Back-End Advance, which helps consumers feel secure in their purchases by allowing them to finance related products, like gap protection, extended service contracts, or tire and wheel coverage.

To help mitigate industry inventory challenges, Octane launched a 60-day approval program that empowers consumers to apply for financing before their desired vehicle is in stock. The company also redesigned its used program, which includes Harley-Davidson motorcycles, golf carts and other vehicles, to take advantage of the growing demand for pre-owned vehicles.

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In 2021, Octane achieved an all-time high approval rate, enabling even more consumers to finance passion purchases, while seeing its annualized net losses outperform its already record low rates realized in 2020. The company also made its lending journey even faster by creating an easier, more targeted process for handling customer verification, insurance and documentation requirements. At the same time, Octane streamlined its dealer onboarding policy and process.

“This past year, we reached countless milestones by using technology to simplify the buying journey for passion purchases,” said Jason Guss, CEO of Octane. “Thank you to the entire Octane team, as well as our OEM, dealer and investor partners, for helping us to achieve such extraordinary success. We will build on this momentum in 2022 and bring our quick and simple lending experience to even more consumers, dealers, OEMs and markets as we continue to connect people with their passions and fuel our customers’ lifestyles.”

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To learn more about Octane, visit www.octane.co.

1The full analysis for S&P’s ratings, including any updates, which you should review and understand, is available on standardandpoors.com and can be accessed here (2021-1) and here (2021-2).

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2KBRA’s ratings are subject to all of the terms and conditions set forth in the related report and KBRA’s website, which you should review and understand, and can be accessed here (2021-1) and here (2021-2).

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