Secondhand car platform Cars24 has raised whopping $100 Mn from new as well as existing investors. The round was spearheaded by Unbound and KCK Global, with the former being an London based investment firm headed by Shravin Mittal – son of Bharati Airtel’s Chairman Sunil Mittal.
New York headquartered investment firm Moore Strategic Venture (new investor) along with host of existing investors Sequoia Capital, DST Global, Partner Fund and Agnelli Family also pumped capital in the used car platform. The entire financing was apparently done through equity funding.
However, Cars24 didn’t disclose the market valuation it commanded during the latest funding round. It commanded a valuation of $550 Mn during its last funding round. The company is widely touted among the favorites and most likely startup to enter India’s rapidly increasing unicorn club.
Talking to Economic Times, Cars24’s chief operating officer said that the company plans to expand to 75 cities by end of the current year and nearly 200 cities by end of the next year.
The fact that the Gurgaon based company recently received NBFC license from RBI may also play catalyst role in its ambitious expansion plan.
Vikram Chopra, Mehul Agrawal, Gajendra Jangid and Ruchit Agarwal founded the second hand car platform in 2015.
Despite slowdown in auto sales, Used Car market is still booming
Massive drop in auto sales (especially in new cars) has recently been making headlines and is widely considered as undeniable sign of the economic slowdown. However, there has not been an iota of sign of this slowdown on the sale of second hand cars.
A recent data furnished by IndianBlueBook claims that used cars clocked sales of 3 Mn compared by 3.6 Mn units during FY 18-19.
Market experts claim that demand for second hand cars is just as good during the period of economic boom but the demand skyrockets especially during the economic slowdown. If this is indeed the case then this should spell good news for startups like Cars24.
However, the only apparent challenge is that India’s used car market is still dominated by unorganized players and organized players like Cars24 still own a very small pie of the market.