Cars24 gets $11 million funding to move swiftly in the Unicorn race
Cars24, the Gurugram-based online marketplace for used cars, bagged a whopping funding of $11 million from its Singapore-based parent entity in March, according to RoC filing with Ministry of Corporate Affairs (MCA). Subsequently, the post funding valuation now stands at $665.94 million (Rs 4,602.33 crore). The company received the final part of the $50 million funding, precisely Rs 331.09 crore in October last year.
Let’s go back to the july of 2018 when the fundraising of $50 million by cars24, from Sequoia Capital and existing investors, was reported. At that time Cars24 was standing at a valuation of estimated $250 million. Now, in a very short span of time, that valuation looks like a long lost history. In less than 6 months the company more than doubled its valuation and in the next 3 months, it grew further by 21.6 %, increasing the valuation growth by 2.6 times in less than 9 months. With these figures, Cars24 is proving itself as the fastest growing horse in the unicorn race.
The Silent Performer
In the Mahabharata of used car market in India, Cars24 is continuously approaching a step forward in its approach to break the chakravyuh of the mythical tag of Unicorn. All the eyes were always set on the company’s indirect competitor Droom and nobody ever talked about Cars24.
Currently there is no news on the Droom front and Cars24 is breaking all the hurdles to kiss the good fortune.
Despite having a long array of competitors like CarDekho, CarTrade and others, this pace of growth by the Mehul Agrawal and Vikram Chopra founded company becomes surprising.
Taking New Roads
“Without continual growth and progress, such words as improvement, achievement, and success have no meaning” – Benjamin Franklin
As part of the expansion plans to have 1000 branches in 100 cities by 2020, Cars24 has recently opened its first Kerala outlet in Kochi. Pre-owned cars business is about 1.4 times the new cars business in terms of volume, furthermore the average ownership of cars in Kochi has also fallen from seven years to 3.5 years, which shows the huge potential in the area. As per Gajendra Jangid, co-founder and Vice President, Cars24:
“There are also plans to open four more outlets in Kerala in Thiruvananthapuram, Thrissur and Kozhikode shortly. The company plans to open 300 branches in 50 cities by the end of this year across the country”
The company is also diversifying into financial business, as it had applied for an NBFC (non-banking finance company) licence to start lending from its own books. The company will use the funds to focus on the used-car segment of the market and build a strong foundation in transaction services, including insurance and financing.
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