Gurugram-based online used car marketplace Cars24 is the latest company to enter India’s unicorn club, after a new round of funding that was announced on Tuesday.
The firm raised $200 million in a growth funding round, led by DST Global, with participation from returning investors Exor Seeds, Moore Strategic Ventures and Unbound, at a valuation of $1 billion.
The company, in a statement, said that it would use the fresh capital to invest in technology and product innovation, as well as enter new business verticals.
“With this investment, we will continue to innovate our product to provide the best experience for all parties -- with sellers getting value for their car and buyers getting to choose from an assortment of automobiles.” Vikram Chopra, co-founder and CEO of Cars24, said.
Chopra and Mehul Agarwal founded the company in 2015, after they sold online furniture store FabFurnish to retail giant Future Group.
In November 2019, Cars24 received $44 million from its parent entity, Singapore-based Global Car Group. A month before that, the company raised $100 million in a growth funding round from Unbound, Moore Strategic Ventures, Sequoia Capital India, Fiat Motors owner Agnelli Family and KCK Global. Cricket player MS Dhoni backed the firm in a Series D round in August 2019, even as the firm raised $50 million in a Series C round in July 2018.
According to a 2019 study by market research firm Mordor Intelligence, the used car market in India, which was worth $24.24 billion in 2019, is likely to grow at a CAGR of 15.12% during the 2020-2025 period.
Cars24, as per the statement, has over 10,000 channel partners registered on its platform and plans to double the number by the end of 2021. It currently operates in over 130 cities in India.
The firm, which claims to have exceeded annual transactions of 2,00,000 units, said it has witnessed a four-fold increase in website engagement compared to pre-Covid levels.
Cars24 leverages vehicle appraisal technology, with AI-enabled pricing algorithms, which it says provides accurate market price for every vehicle, backed by a scaled infrastructure.
“Cars24 has pioneered a significantly differentiated experience for the customer and dealer by deeply leveraging data and technology at each step,” Rahul Mehta, managing partner of lead investor DST Global, said.
The firm, which forayed into the used two-wheelers category in June this year, said it has already transacted over 3,000 vehicles so far. The company also acquired an NBFC license for its financing business last year.