Why “Pre-Owned Goods Marketplace For Vehicles” Has Started Witnessing Launch Of More Startups Topped With Investor Interests?

Buying used vehicles and other products is no more a reason to be looked down upon. With the advent of various online portals for used vehicles, electronic gadgets, the sector has started witnessing large amount of customer attraction.

The market that was said to be dominated by the two giants Olx and Quikr, has now started witnessing new players that are targeting a particularly category. And thus posing a great competition to the above mentioned companies in their particular area.

Used vehicles, which is said to be the most popular category in this segment has witnessed a number of startups that have emerged in the past few months.

If we go by numbers, according to a recent study done by Google India and Mahindra First Choice Wheels Ltd online searches for used cars alone has seen an increase of 20 times in the last six years, which indicates a compounded annual growth rate of 54%.

The annual used-car demand in the Indian market is around 1.4 Mn cars. Tapping this market, players like Carwale, Mahindrafirstchoice, Catrade among others have been trying to dominate the market in the used car sale segment.

A three month old Mumbai-based startup, Truebil is yet another startup trying its luck in the pre-owned good segment with a focus on cars. The startup has very recently grabbed $500K in its first round of funding led by Kae Capital and angel investor Anupam Mittal, Founder and CEO of People Group.

“The time has come for solving consumer problems end-to-end and that’s what Truebil does. From verification to the actual car sale, Truebil does everything and guarantees that the car will be sold,” tells Anupam Mittal.

Founded in March 2015 by a team of seven entrepreneurs Suraj Kalwani (CEO), Ravi Chirania, Shubh Bansal, Rakesh Raman , Ritesh Pandey, Shanu Vivek  and Himanshu Singhal, Truebil provides a one stop solution for buying and selling of used automobiles by offering free inspection and valuation, quick sell guarantee, free vehicle buying consulting, smooth paper transfer, loan assistance and insurance support.

Prior to Truebil, the founders had stints at startups like Housing, Fab and Fusion Charts.

Shubh Bansal said that in his own experience, it took him around one month of hustling to finalise a used-car deal but today with Truebil, he claims to have finalised deals in about 7 days for his customers.

Some Numbers

• The startup is witnessing a 15% growth every week
• More than 1000 verified cars registered on its platform
• Did INR 3.12 Cr. GMV
• Sold more than 156 cars till date

Commenting on the funds raised, Shubh Bansal, Co-Founder & Chief of Marketing & Growth, Truebil said, “The fundamental problems in buying a pre-owned car are the delayed processes and the hassle. With Truebil’s unique model, we are confident of bringing about a revolution in the used car market in the country and making the buying process a gratifying experience for the consumers. We have received encouraging response from the users since the website’s launch in Mumbai.”

The startup plans to use the fresh funding for innovating on the products side to give them a seamless experience. It has marked its pan-Mumbai presence, with a team of 50 individuals and in-house auto engineers.

Online selling of old goods has increased by more than three times last year and a recent study shows that the total value of used goods stocked in urban India is worth INR 56,200 Cr. at present.

“Market for pre-owned goods already exists in the form of Ebay and now Olx and Quikr but that is more of a niche market. The real value lies in pre-owned cars and homes due to their ticket sizes,” said Anupam Mittal.

The startups dealing particularly in the sale of pre-owned cars includes Carwale, Cartrade, MahindraFirstChoice, Carnation , Droom and  Zigwheels.

Cartrade.com

It is an online automotive market for buyers and sellers of new and used vehicles.It organises car auctions across more than 80 cities with a participation of over 1200 dealers.

Based in: Mumbai

Products & Services: Compare Cars, Buy/Sell Used and New Cars, User/Expert Reviews

Founders: Vinay Sanghi

Founded In: 2006

Funding: $30.2 Mn in 1 Round from Tiger Global Management, Canaan Partners and Warburg Pincus.

MahindraFirstChoice.com

It is a multi-brand second-hand car sales venture operating through a hybrid offline-online model.

Based: Mumbai
Products & Services: Car Servicing and Maintenance, Four wheeler Spare Parts, Buy/Sell Used Cars

Founders: Anand Mahindra, Rajeev Dubey and Dr. Nagendra Palle

Founded in: 2008

Funding: Raised $10 Mn from hedge fund Valiant.

Carnation.com

Carnation provides complete solutions for almost all brands of cars, starting from quick servicing, mechanical repairs, body repairs, accessories, insurance, car exchange and even doorstep service through a chain of workshop on wheels.

Based: Noida

Products & Services: Online Car Sales, Car Insurance and Car Servicing

Founders: Jagdish Khattar and Kunal Khattar

Founded in: 2008

Carwale.com

CarWale offers a consumer-focused site that includes content and tools for exhaustive research, pricing and marketplace information.

Based: Mumbai

Products & Services:  Video Car Reviews, Car Research, Expert Reviews, On-Road Price, Used Car Listing

Founders: Mohit Dubey, Tufail Khan and  Gaurav Verma

Founded in: 2005

Funding: Undisclosed amount in Seed funding and $7Mn in Series A 

Zigwheels

ZigWheels.com is an exhaustive auto portal cutting across cars & bikes.

Based: Gurgaon

Products & Services: Compare Cars, Buy/Sell new and used cars, Car Insurance,Maintenance Calculator, Car Deals and Find Dealers

Founders: Vijesh Sharma

Founded in: 2008

Droom

Airbnb meets Craiglist for the automobile industry

Based: Gurgaon

Products & Services: Used and New automobile buying/selling, cars, bikes and mobile marketplace

Founders: Sandeep Aggarwal

Founded in: April,2014

Funding: N/A

Just yesterday, another startup operating in the pre-owned goods sale, CredR got funded by GrowthStory. The four month old Mumbai-based startup is enabling the ecommerce of pre-owned two-wheelers bundled up with features like test rides at the home of the buyer, a 6-month warranty, one year roadside assistance and fair pricing system.

With the availability of better ticket sizes and margins in the vehicle category particularly cars, this segment has now started seeing emergence of new players, and the funding activities. But this also increases the competition among the current players and obviously the early movers in the classified segment i.e Olx and Quikr too pose a great threat to the growth of these startups.