CycleOne Financial will expand its breadth of offerings to include new motorcycle financing, after the startup expands its leasing limit — the amount it approves consumers for — beyond $12,000, President Logan Riley told Powersports Finance.
Orlando, Fla.-based CycleOne Financial is a subprime lessor that leases all pre-owned motorcycles included in the NADA Guide. Lease amounts can be up to $12,000, and lease terms range from two to four years.
Many — if not all — new vehicles cost more than $12,000, Riley said, so CycleOne cannot begin financing new motorcycles until it increases its leasing limit. To do that, the company will shift more into the prime credit band — where consumers typically have higher incomes and better credit history — to limit risk exposure for the higher-volume leases, Riley explained.
“New units are expensive, and most people in the subprime space are not going to get qualified for new units,” Riley said. CycleOne, by specializing in subprime leasing, is in a market where financing pre-owned vehicles makes the most sense, he added, but as the company shifts more into the prime space, the startup will open its doors to new motorcycle financing.
CycleOne launched in April 2015, and has raised $4 million in seed funding to-date. CycleOne has funded 600 leases since its launch, and currently makes leases for 15 dealerships in the Orlando and Tampa Bay areas.
Separately, the startup is developing a dealer portal, which it plans to launch within the next six to 10 months after raising sufficient capital through its Series A funding round.