The online bidding portal enables customers to sell their vehicles directly to dealers nationwide
Following its successful US$19 mil series B fundraising round, Carsome Sdn Bhd is looking to scale up and widen its foothold in Indonesia and Thailand, which are the region’s largest automotive markets with over 3.6 million used car transactions annually.
Its co-founder and CEO Eric Cheng says the funds would help change the status quo and propel Carsome’s ambition to be the “new default way” of selling used cars in Southeast Asia.
Carsome aims to be the ‘new default way’ to sell used cars in Southeast Asia, says Cheng
“The funds will be utilised immediately to expand our operations in the region and hire key talents to help meet our growth objective. A major portion will be focused in Indonesia and Thailand.
“Furthermore, we will increase our marketing effort to establish Carsome as the ‘new default way’ of selling cars,” he adds.
As part of the expansion, it aims to boost its market share in Southeast Asia by strengthening its brand awareness via more localised marketing content, as well as delivering a superior customer experience for the car-selling process on its platform.
It will also introduce new product verticals such as financing and warranty solutions to empower dealers, as well as make it easier for customers to sell their vehicles on its platform.
Cheng notes the region’s used car industry – one of the largest globally with an estimated value of over US$30 bil annually – is still highly fragmented, inefficient and lacks transparency.
These are the problems that Carsome is seeking to address, by providing a seamless and transparent online used car-selling process that provides users an easier way to sell their cars to dealers nationwide in a fast, fair and free manner.
“We feel Southeast Asia’s burgeoning automotive sector is in the early stages of a digital transformation, and believe there is a tremendous opportunity for Carsome to bridge the offline-to-online space,” says Burda Principal Investments principal Albert Shyy.
The Hubert Burda Media investment arm led the series B round, along with existing investors Gobi Partners, InnoVen Capital and Lumia Capital.
It will provide Carsome with industry expertise to support growth acceleration, particularly in business expansion and development, while the scale-up’s existing investors will continue supporting it strategically to win local markets.
Carsome’s online bidding portal enables customers to sell their vehicles directly to dealers nationwide by facilitating the entire process from inspection to valuation, bidding and payment as well as logistics needs.
Headquartered in Malaysia, Carsome expanded to Indonesia, Thailand and Singapore in 2016. With over 150 employees to cater to its rapid business expansion, it has one of the largest dealer networks with more than 2,500 registered dealers on its platform.
It is looking to an initial public offering within the next three years, either on the Japan Exchange Group or the Australian Securities Exchange where investors are technologically more savvy.
Carsome had a annualised gross revenue of about US$27 mil as of Dec 20, 2016. Its monthly total transactional value has increased by more than fourfold since January 2017, with total car sales facilitated on its platform more than quadrupled in the same period.
Since its inception in 2015, it has registered more than 200,000 bids for cars, with over 70% of the transactions done inter-city.
It is on track to break even by early next year, Cheng says.