New Delhi: Online car platform CarDekho on Thursday said it has raised $110 million in a Series C funding round from existing investors Sequoia India, Hillhouse Capital, Alphabet’s growth investment arm Capital G and Axis Bank. The investment values CarDekho at $400-500 million, the company said in an email response.
CarDekho, owned by Girnar Software Pvt. Ltd, had previously raised $75 million over three funding rounds. It counts Tybourne Capital, Ratan Tata, HDFC Bank, Times Internet, Dentsu and Trifecta Capital among its existing investors.
The Rain Maker group acted as the financial adviser to CarDekho for the transaction.
The new investment is significant for a Series C funding round for a business to consumer startup in the automobile segment. Last year, online business to business marketplace Udaan raised $225 million in a Series C round led by DST Global and Lightspeed Venture Partners global fund while robotics startup GreyOrange raised $140 million in a round led by US-based Mithril Capital.
The company plans to utilize the funds to enhance focus on the used-car segment and improve its transaction services including its insurance (InsuranceDekho.com) and financing businesses.
“Our user engine has scaled up tremendously and has enabled us to incubate allied business like insurance and finance business as they are one of the largest opportunities ahead of us. The opportunity lies in extending formal credit and insurance coverage to the new-to-formal economy population and will be continue to be a focus area for us," said Amit Jain, CEO and co-founder, CarDekho.
Launched in 2008, CarDekho serves as an online car search platform for both new and used cars and offers expert reviews and price comparisons. The Jaipur-based company partners with car makers, dealers and financial institutions to facilitate vehicle purchases.
CarDekho works with more than eight auto makers and claims to contribute 15-30% of their combined annual sales. In addition, it has 5,000 dealer partnerships across India directing 42% of retail sales, according to the company.
The company has expanded to South East Asia including markets such as Malaysia, Thailand and Indonesia with Zigwheels.my, Oto.com and CarBay.my. It claims to have become the leading car portal in Indonesia within two years of its launch.
CarDekho is the flagship site of parent company GirnarSoft which also operates auto sites such as Zigwheels.com, BikeDekho.com, Gaadi.com and Powerdrift. It has also introduced college discovery platform CollegeDekho.com, TyreDekho.com and TrucksDekho.com.
Most of GirnarSoft’s revenue comes from advertising on automobile classifieds sites like CarDekho. The parent company has followed an acquisition-led-strategy to grow its business, acquiring three companies in the automobile segment in 2016.
“Since Sequoia India’s initial investment, CarDekho has been executing well, and today has many existing business lines contributing to their growth," said Shailesh Lakhani, managing director, Sequoia Capital India Advisors.
Car Dekho competes with Cars24, Car Trade (MXC Solutions Pvt. Ltd), Droom that raised $30 million from Japanese investor Joe Hirao along with vertical classifieds portal QuikrCars and Olx. Used car marketplace Spinny (Yellow Drive Technologies) is in talks to raise $10-15 million, Mint reported in November.
CarDekho revenues jumped by 40% to ₹ 160 crore in FY 18 from ₹ 114 crore last year. It posted a loss of ₹ 70 crore. “We as a group are looking a growth of the 60% in net revenues for FY19," Jain said in an e-mail response.