Cars24, an online marketplace for used cars, secured $400 million in a Series G fundraising round led by return investor Alpha Wave Global (previously known as Falcon Edge Capital) and other existing investors on Monday.
Diverse financial organisations contributed $300 million in stock and $100 million in debt to the round. This is the company’s third funding round in less than a year, and it values the used automobile platform at $3.3 billion, up 83% from the previous round in September 2021.
When it secured $450 million in its Series F round in September, the company was valued at $1.84 billion.
Start-ups like Spinny, CarDekho, and Droom have all been valued at over $1 billion in recent investment rounds, indicating that the pre-owned car retailing industry has witnessed increased investor activity. Along with the investment boom, Mumbai-based CarTrade went public in August with a Rs 2,999-crore IPO that was 20 times oversubscribed.
According to a business statement, the investment will be used to drive the brand’s global expansion in West Asia, Australia, and Southeast Asia, as well as to further reinforce its stronghold in the Indian market.
Cars24 will also continue to improve its technology offering, which includes seven refurbishment laboratories for used vehicles in India and the United Arab Emirates, which is one of Dubai’s largest commercial leasing deals ever.
The start-up, which was founded in 2015, manages the entire customer journey, from vehicle discovery to pricing estimation, financing, and refurbishment. The company claims that demand for their platform has increased in worldwide countries such as Australia, the United Arab Emirates, and Thailand.
The used automobile retailing industry is currently valued at $100 billion globally.
“Cars24 has aggressive plans for 2022 and beyond, and we can’t wait to put this investment to work. Today, we are witnessing greater acceptance amongst customers across the globe for our platform when purchasing their next car. As we continue to build the best infrastructure for the future with an end-to-end digital customer experience, we are confident that this will delight our customers with our high-touch industry experience,” said Vikram Chopra, co-founder & CEO, Cars24, in a statement.
After the pandemic wreaked havoc on the vehicle industry in CY2020, the used car selling market emerged as one of the fastest-growing consumer Internet verticals.
According to a survey published by OLX Auto and Crisil, India’s used automobile marketplace segment will feature more than 70 lakh vehicles by 2025-26, up from 38 lakh in 2020-21. Over the following five years, this represents a CAGR of 12-14 percent.
Due to covid-19’s disruption on consumer purchasing patterns and as digitisation enters more small towns, the pre-owned automobile market is predicted to increase at a rate of 15% in FY22 alone.
