CarTrade.com raises $30M from Warburg Pincus, Canaan & Tiger Global

Mumbai-based CarTrade.com, an online auto classifieds platform owned and operated by MXC Solutions Pvt Ltd, has raised Rs 185 crore ($30.2 million) in funding led by private equity firm Warburg Pincus, with participation from existing investors Canaan Partners and Tiger Global.

Warburg Pincus put in Rs 130 crore ($22 million) as part of the transaction and got around 23 per cent effective stake, valuing the venture at around $100 million.

The funds will be used to diversify the company's offerings for end consumers and dealers. It will enable CarTrade to expand its offerings across online and mobile platforms, fuel the platform's growth in the online auto industry, and strengthen its marketing efforts.

Back in 2011, MXC Solutions had raised $13 million in its third round of funding led by venture capital firm Tiger Global Management, with participation from existing investor Canaan Partners. The money was for another vertical of the firm which offers an online vehicle auction platform CarTradeExchange.com (earlier MotorExchange.in). In December 2010, it raised an undisclosed amount in Series B funding from Canaan Partners and Epiphany Ventures.

Before that, the company had raised an undisclosed amount in Series A round of funding from Canaan Partners besides other investors including Austin Ligon, founder and CEO of US-based CarMax, in December 2009.

"The funds raised shall be employed to further expand our services to help us offer our consumers and dealers a seamless online experience. We also plan to focus significantly on the mobile space and provide products and services, which in many cases will be the first of its kind," said Vinay Sanghi, founder and CEO, CarTrade.

Nitin Nayar, MD, Warburg Pincus India Pvt Ltd, added, "We see tremendous potential in the Indian automobile market. CarTrade has shown strong growth momentum in the last couple of years. Warburg Pincus is excited to partner with a talented team to build on its position and to accelerate its growth plans."

CarTrade.com is an online auto marketplace in India that provides buyers and sellers a structured platform for buying and selling new and used vehicles. For used car buyers, the platform offers a selection of over a lakh listings, price information and car certification. For new car buyers, there are a host of features such as reviews, on-road prices, car comparisons and latest news, etc.

All this information, along with a host of research tools, price index information and a growing dealer network is also available on the site.

The company is promoted by Sanghi, a former CEO of Mahindra First Choice. Rajan Mehra, MD at Nirvana Venture Advisors and former country head of eBay, India is also a founder-director in CarTrade. Its investors include Canaan Partners, Epiphany Overseas Ventures and Tiger Global, apart from Warburg Pincus.

For Warburg Pincus this is the second such investment in consumer internet business. It had earlier backed Quikr, a horizontal classifieds venture.

This is its second addition to its India portfolio after buying a stake in Laurus Labs besides putting in more money in some existing investees such as AU Financiers and Quikr.

In another transaction in the same space, CarDekho.com, an auto portal owned and operated by Jaipur-based multi-vertical consumer internet company Girnar Software Pvt Ltd, acquired Naspers Group-owned Gaadi.com, another automobile site, for an undisclosed sum.

(Edited by Joby Puthuparampil Johnson)