Nokia Growth Partners is putting its $100 million Connected Car Fund to work, backing Zubie Inc. in what executives say is the first in a series of bets on the buzzy space.

The wireless giant's venture arm led an $8 million round in the vehicle diagnostic startup, with global automotive parts supplier Magna International Inc.MG.T -0.22% and existing investors also participating.

The deal comes at a key time for Nokia NOK1V.HE +1.58% Growth Partners and represents the latest vote of confidence in the tiny Charleston, S.C.-based startup.

Like competitor Automatic Labs Inc., Zubie makes a hardware dongle and provides associated apps that deliver real-time feedback on a vehicle and the driver. The dongle plugs into a car's steering column and aggregates data about system functions, like fuel and oil levels, before suggesting a tune-up or other action.

Zubie also provides feedback on driving habits and makes suggestions, such as braking more gradually, to increase safety and lower costs.

Unlike Google's Android Auto–its recently unveiled system for car dashboard displays–-and other connected car initiatives, Zubie is not focused on music, voice control or other consumer apps.

For Nokia Growth Partners, which had worked with the company for about a year in conjunction with Nokia's vehicle mapping and navigation group HERE, Zubie provides "a great entry point" to introduce other services.

"We did a thorough review of the space before investing," said Nokia Growth Managing Partner Paul Asel, who joins the Zubie board. "Connectivity is really a platform for services."

Mr. Asel said no other investments have been made from the $100 million Connected Car Fund, which Nokia debuted in May, but he said others are planned.

Along with the Connected Car Fund, he said, Nokia Growth Partners is still investing from a $250 million Fund III it raised in 2013. With Nokia as the group's sole LP, the firm invests for strategic as well as financial reasons.

For Zubie, the investment will allow it to continue improving its product and double its headcount to 40 by the end of the month.

Spun out of Best Buy Co. in 2012, Zubie previously raised a $10 million Series A round from Castrol innoVentures, Comporium and OpenAir Equity Partners. When it closed the round eight months ago at a valuation just south of $35 million, Zubie told VentureWire it was in the process of lining up a series of partnerships.

Zubie Chief Executive Tim Kelly declined to provide an update, but a spokeswoman for the company confirmed the partners were all Fortune 500 companies in the telecommunications, dealership and insurance carrier sectors. The same spokeswoman said those partnerships will be finalized by the end of the 2014

Existing investors Castrol innoVentures, Comporium and OpenAir Equity Partners also participated in the new Series B round.

During the past six months or so, Nokia Growth Partners has made 11 new investments and had three exits, including Alibaba Group Holding Ltd.'s $3.8 billion purchase of mobile browser UCWeb and the IPO of mobile ad tech company Rocket Fuel Inc.

Valuation of the Series B round was not disclosed.