Cars24, the online used car marketplace, has joined the unicorn club with a Series E round worth $200 million led by DST Global. In the latest round, current backers Exor Seeds, Moore Strategic Projects, and Unbound also participated.
Cars24 will join Razorpay, Unacademy, Zerodha, Postman, Nykaa, FirstCry, and Pine Labs, which became India’s unicorn in 2020, among others. Importantly, it has been the first company to evaluate more than $1 billion from the used car space.
This is a 2X leap in the value of Cars24 in one year. Last year in October, the Gurugram-based firm raked in $100 million in the Series D round led by Unbound and KCK Global. To develop new market verticals and improve its product and technology capabilities, the net proceeds will be used.
Cars24 has an asset-heavy model, which purchases the car on behalf of dealers, co-founded by Vikram Chopra and Mehul Agrawal. Cars24 is going to double down on bikes, according to Chopra, a new category that started several months ago.
Already, Cars24 claims to have handled over 3,000 two-wheelers so far. Chopra also claims that the transaction volume of the company has exceeded its pre-Covid volumes by more than 20 percent, and with over 15,000 cars transacted each month, month-on-month sales stand at around $50 million.
For its financing business with two-hour disbursals, the company received an NBFC license last year. Cars24 announced earlier this month that it is offering its employees the ESOP cash-out scheme worth Rs 35 crore.
The post-Covid growth claim is a good sign for the five-year-old company that fired over 300 individuals in 2019. The company had also received a legal notice for alleged defaults in payments from a clutch of landlords and had to shut down different stores in the NCR region.
During the outbreak of Covid-19, companies in the used car section were going through tough times. Although Cars24 did not see any layoffs during the period, the founders of the company announced that they would forgo their salaries and introduced a voluntary pay cut for staff that would be invested as the company’s ESOPs.