Used-car marketplace website Cars24 has raised USD 100 million in its Series D funding led by Unbound, a London-based investment firm, and Toronto-based KCK Global, which is an existing investor. The duo has put in an estimated USD 25 million each.
Others participating in the round include the New York-based investment firm Moore Strategic Ventures; Sequoia India; Partners Fund; Apoletto Asia which is associated with Russian billionaire Yuri Milner’s DST Global, among others.
The new funding will be used to expand to new markets, develop technology and also start consumer lending as a few months ago it received a non-banking financial company (NBFC) license from the Reserve Bank of India (RBI).
The firm is currently operating in 50 cities, and looking to expand to 75 by year-end and 200 by the end of 2020. It will “begin pilot services in Delhi, Mumbai, and Bangalore and scale up to other cities gradually, through a new entity Cars24 Financial Services,” said Jangid, co-founder and chief marketing officer.
Agrawal, the firm’s chief operating officer, sees “a long tail in India when it comes to expansion.” The top 75 cities only contributed around 65% to our action, according to him.
The procedure for selling a car has been simplified by the Gurgaon-based startup, wherein car owners post their requirements, go through a vehicular inspection at any of its 170 branches across India, and then sell their four-wheeler through Car24’s in-house tech-enabled auction platform to businesses dealing in pre-owned vehicles. The payment to the sellers is done almost immediately.
Cars24 said it currently conducts 13,500 transactions monthly, with the average value per transaction being USD 4916. It hopes to pump up the figure to one million annually by the end of 2021.
The company currently has 10,000 channel partners from more than 230 cities across India, which it’s keen to double within the next two years. Jangid, told local paper Mint, “The number of used cars we sold in September, is higher than the total number of new passenger vehicles sold in India, that month, by several leading car manufacturers, outside the top three.”
India’s used car market is estimated at about USD 30 billion, and sees about 5 million transactions annually.