Online used car marketplace Cars24 has entered the club of unicorns with a $200 million worth Series E round led by DST Global. Existing backer Exor Seeds, Moore Strategic Ventures and Unbound also participated in the latest round.
Cars24 will join the likes of Razorpay, Unacademy, Zerodha, Postman, Nykaa, FirstCry and Pine Labs which became unicorn from India in 2020. Importantly, it has become the first firm from the used car space to be valued over $1 billion.
This is 2X jump in Cars24’s valuation in a year. The Gurugram-based firm had raked in $100 million in Series D round led by Unbound and KCK Global in October, last year. The fresh proceeds will be deployed towards building new business verticals and strengthening its product and technology capabilities.
Co-founded by Vikram Chopra and Mehul Agrawal, Cars24 has an asset-heavy model, which buys the car on behalf of dealers. According to Chopra, Cars24 is going to double down on bikes, a new category started several months ago.
Cars24 already claims to have transacted over 3,000 two-wheelers until now. Chopra further claims that the company’s transaction volume has surpassed its pre-Covid volumes by more than 20% and the month-on-month sales stand at around $50 million with over 15,000 cars transacted every month.
The company had received an NBFC license last year for its financing business with two-hour disbursals. Earlier this month, Cars24 announced that it’s offering ESOPs cash-out scheme worth Rs 35 crore to its employees.
The claim of growth post-Covid is a good sign for the five-year-old company which had fired over 300 people in 2019. The company had also received a legal notice from a clutch of landlords for alleged defaults of payments and had to shut down various stores in the NCR region.
Companies in the used car segment were going through tough times during Covid-19 outbreak. While Cars24 didn’t see any layoff during the period, the company’s founders announced to forgo their salaries and introduced a voluntary pay cut for employees that would be invested as ESOPs of the firm.