Online marketplace for the sale and purchase of second-hand cars ‘Cars24’ has raised funds amounting to $50 million (Rs 340 crore). The latest funding round was led by Sequoia Capital.
The other existing investors that participated in the funding round were Cayman Islands-based Kingsway FCI Fund and Toronto-based KCK Global. After this round, the market valuation of the company is expected to reach around $250 million.
The Gurugram based firm is planning to use these funds for the purpose of boosting up its expansion plans. Cars24 is based on an asset-heavy customer-to-business (C2B) model, in which it purchases used cars from individuals and dealers and sells them to other dealerships.
Since its establishment in 2015, the company has sold around 1,00,000 cars.
The founders of the company are Vikram Chopra and Mehul Agrawal who have been working hard for the company’s growth and expansion. The average transactions that the company records are 3,500-4,000 per month, with an average price of about Rs 2,00,000-3,00,000 per vehicle sold.
Prior to this funding round, Cars24 had raised about $50 million from global investors, and it recorded about Rs 417 crore in gross sales in FY17, while losses stood at Rs 76.3 crore. And, the financials for fiscal 2018 are yet to be filed.
The company competes with CarDekho, CarTrade, Droom as also Quikr Auto and Olx in the online auto marketplace space. Several firms, including CarDekho and CarTrade, have turned their focus towards the second-hand car business, which is yet to be fully tapped in India and one that remains largely unorganized.
Cars24 seems to increase its existence and growth in all aspects and give a fight to the predominant companies in this segment.