Used automotive market Vehicles24 raised $200 million in its newest funding spherical at a valuation of greater than $1 billion, the primary Indian startup within the automotive sector to attain unicorn standing, as a raging pandemic prompted customers to shift in the direction of private mobility.
The Series E funding was led by billionaire Yuri Milner’s DST Global fund. Existing buyers together with Exor Seeds, Unbound and Moore Strategic Ventures participated within the spherical.
The elevated demand for used vehicles has been propelled by the worry of utilizing public transport amid an unabated rise in coronavirus infections in prime cities. Startups akin to Gurugram-based Vehicles24 provide customers a better and trusted method to purchase and promote used vehicles.
The capital can be used to bolster Vehicles24’s new traces of enterprise akin to pre-owned two-wheelers, buyer financing and car servicing.
“People who did not have cars are looking to own a car due to safety issues while many others want to upgrade from two-wheelers. There is a surge in traffic on the website, and monthly transactions have surpassed pre-covid levels,” mentioned Vikram Chopra, co-founder and chief govt of Vehicles24.
The recent funds can even be used to rent folks, construct the model and improve market share from 4% to double digits, Chopra mentioned in an interview.
After seeing a pointy decline in enterprise throughout the lockdown, Chopra mentioned the corporate has seen a strong restoration. The pandemic augmented the urge for food of the trade with a rise in inquiries for pre-owned automobiles, he added.
Chopra mentioned the corporate’s focus can be on the used two-wheeler class that was launched throughout the unlock part with Vehicles24 Moto and the financing enterprise.
The firm acquired a non-banking monetary firm licence final yr for its lending enterprise, Vehicles24 Financial Services, with an intention to offer immediate entry to credit score. “The market for used cars and bikes in India is a huge $50 billion opportunity, and we are the best set to ride on these tailwinds.”
While new automotive gross sales slowed down throughout the lockdown, the pre-owned automotive market has continued to develop over the previous few months and is now bigger than the brand new automotive market. In 2018-19, whereas new automotive gross sales had been recorded at 3.6 million models, Four million used vehicles had been purchased and bought, based on a report on India’s pre-owned automotive market by IndianBlueBook, a used automotive pricing information by Mahindra First Choice Wheels.
“Cars24 has pioneered a significantly differentiated experience for the customer and dealer by deeply leveraging data and technology at each step, resulting in world-class operational efficiency and market leadership in the segment,” mentioned Rahul Mehta, managing accomplice at DST Global.
A slowdown in new automotive gross sales might imply the demand is shifting in the direction of the pre-owned market, car trade executives mentioned. In reality, many individuals have changed their previous vehicles with pre-owned vehicles as a substitute of shopping for new ones.
Vehicles24 has benefited from this pattern, with annual transactions on its web site exceeding 200,000 models, topping pre-covid ranges. To meet the demand, Vehicles24 has expanded its presence from 155 shops in 35 cities to 230 shops until September.
Vehicles24 is the eighth Indian startup to change into a unicorn this yr. The others are Pine Labs, FirstCry, Nykaa, Unacademy, Zerodha, Razorpay and Postman.
Vehicles24 drives into unicorn club