Online used car marketplace Cars24 has raised $450 Mn in its latest funding round led by DST Global, Falcon Edge and SoftBank Vision Fund. The funding round also witnessed the participation of Tencent, along with existing investors Moore Strategic Ventures and Exor Seeds, said a company statement.
The latest capital raise has nearly doubled the Gurugram-based used car marketplace’s valuation to $1.84 Bn. The funding comprises a $340 Mn Series F equity round, along with $110 Mn debt from multiple financial institutions.
It plans to utilise the capital to expand its operations in the UAE and Australia. It also plans to build its cars, bikes and financing business in India, along with investing in technology.
According to Cars24, it has already sold over 1,000 cars in the UAE since the launch of its operations in April this year. Cars24 announced its launch in Australia last week.
Commenting on the development, Vikram Chopra, co-founder and CEO of Cars24 said: “Over the last six years, we have been working continuously towards fulfilling the dreams of many Indians to own a car by transforming the customer’s journey — ‘the CARS24 way’ — that is hassle-free, safe and transparent. With this investment, we will continue to penetrate the existing car, bikes and financing business in India while venturing into new overseas geographies this year.”
Rahul Mehta, Managing Partner at DST Global was of the view that Cars24 is at the forefront of transforming the way consumers buy and sell cars by providing a unique end-to-end digital shopping and transaction experience.
Founded in 2015 by Vikram Chopra, Gajendra Jangid, Ruchit Agarwal and Mehul Agrawal, Cars24 offers a platform for car owners to sell their used cars at the best price. A consumer can book an appointment with any of the Cars24 branches, visit the branch and sell a car in a single visit.
The platform also offers to purchase a pre-used car from the site. Cars24 has also forayed into selling used two-wheelers. In this segment, the company competes against CredR, OLX, Quikr, among others. Earlier last year, the startup reached unicorn status after raising $200 Mn in a Series E round led by DST Global.
The automobile marketplace is also gearing for an initial public offering (IPO) within the next two years. The startup competes with CarTrade, Droom, Spinny, among others. Further, CarTrade, another auto marketplace platform, was listed on the stock exchanges last month.
As per a report by Mahindra First Choice Wheels, India’s used car market is estimated to be in the range of 6.7 Mn – 7.2 Mn units per year by 2022. The organised channel market share for pre-owned cars grew from 10% to 18% between FY11 and FY19.