Cars24 secures fresh capital from Softbank, others

Gurugram-based used car marketplace Cars24 Services has roped in SoftBank as an investor in a new funding round that is expected to be in the range of $340-350 million, a person familiar with the development told VCCircle. 

SoftBank alone has brought in $75 million as part of this funding round, the person cited above said on the condition of anonymity. The latest funding has been raised at a valuation of $1.6-1.9 billion, the person added.

Separately, regulatory filings show that Cars24 has pulled in around $259 million from DST Global, Alpha Wave Incubation, Tencent and Moore Strategic Partners. 

Cars24's latest funding comes less than a year after it raised $200 million (Rs 1,480.9 crore) as part of its Series E funding round in November last year. That funding had catapulted the marketplace for used cars to the famed unicorn club that features startups with a valuation of at least $1 billion. 

Read: With $200 mn fresh capital, Cars24 joins the unicorn club

The company's Series E was led by DST Global and the capital was raised at a valuation of over $1 billion. Existing investors of Cars24 including Exor Seeds, Moore Strategic Ventures and Unbound had also participated in this funding round. 

In an interaction with VCCircle last month, Vikram Chopra, CEO and cofounder, Cars24, said the company's business grew almost two-fold since the first wave of covid-19 last year. 

Cars24's new initiatives like entering the used bike category and foraying into international markets such as Australia and the United Arab Emirates also helped shore up the business, he had explained while declining to disclose or comment on its absolute financials.

According to data intelligence platform VCCEdge, Cars24 had clocked Rs 2,998.14 crore in net sales in fiscal 2019-20 compared with Rs 1,654.61 in the previous financial year. In comparison, rival CarTrade, which got listed on the stock exchanges earlier this month, recorded operational revenues of Rs 298.2 crore during the period.

This year, Cars24's rival CarTrade floated its initial public offering (IPO) and listed on the stock exchanges. Droom also said it is raising a pre-IPO round and plans to float an IPO next year.