CARS24: How It Helps Users Sell Used Cars in Less Than a Day
CARS24 Success Story
Authors: Rishabh Rathi, Manisha Mishra
Published: Oct 31, 2023 — 13 min read
Company Profile
CARS24 – How It Helps Users Sell Used Cars in Less Than a Day?
Selling a car used to be a tedious task before the advent of online portals. One such portal, endorsed by former Indian cricket team captain Mahendra Singh Dhoni, is CARS24.
Founded by Vikram Chopra, Mehul Agrawal, Gajendra Jangid, and Ruchit Agarwal, CARS24 is an e-commerce platform focused on online car buying and selling. It aims to simplify and streamline the process of buying and selling cars.
CARS24 is now a unicorn used car company. On November 24, 2020, the company entered the Unicorn Club by raising $200 million in Series A financing, led by DST Global, with a post-money valuation of $1 billion. The current valuation of CARS24 is $3.3 billion.
Read on to learn more about CARS24, its founders, business model, revenue, competitors, funding, growth, and more.
CARS24 – Company Highlights
| Startup Name | CARS24 |
|---|---|
| Headquarter | Gurgaon, India |
| Sector | Automotive |
| Founders | Gajendra Jangid, Mehul Agrawal, Ruchit Agarwal, Vikram Chopra |
| Founded | August 2015 |
| Parent Organization | Global Car Group |
| Website | www.cars24.com |
CARS24 – About and How it Works
CARS24 is an innovative e-commerce platform for pre-owned vehicles, including cars and bikes. It offers a wide range of certified vehicles and provides smooth, convenient home delivery services with just a click of a button.
For sellers, CARS24 guarantees the best price for their cars within an hour. With an AI-enabled pricing system, CARS24 can accurately display the market price and appraisal value of the vehicle.
As an ISO 9001:2015 certified company, CARS24 is one of the fastest-growing used car marketplaces in India. It was the first company in the used-car industry to implement a ‘transaction-led’ approach to selling cars. Sellers can privately sell their cars in less than two hours and receive instant payment. On the other hand, CARS24 has thousands of used car businesses that buy these cars online via mobile auctions.
CARS24 operates in over 15 cities across the country and sells to over 100 cities in India. Its unique C2B model has helped it leapfrog the existing C2C and B2C models.
The company has over 155 branches in more than 35 cities in India and also has an offline presence through brick-and-mortar stores. It is disrupting the pre-owned car industry by providing a quick, easy, and hassle-free customer experience.
CARS24 also received an NBFC license from the Reserve Bank of India (RBI) for its new entity, CARS24 Financial Services. This allows the company to facilitate vehicle loans for customers and finance channel partners. Customers are eligible for credit based on the car value they are buying, with an average loan ticket size of INR 2.5 lakh – INR 3 lakh.
CARS24 – Industry
The used car market in India was valued at $27 billion in 2020 and is projected to reach around $50 billion by 2026. The industry has a CAGR of 15% between 2021 and 2026 and was relatively unaffected by the COVID-19 pandemic.
CARS24 – Founders/Owners and Team
Vikram Chopra – CEO and Co-Founder of CARS24. He holds a BTech and MTech in Engineering from the Indian Institute of Technology, Bombay, and an MBA in Finance from the University of Pennsylvania. He is a former Co-Founder of FabFurnish and Investment Analyst at Sequoia Capital.
Mehul Agrawal – Co-Founder and COO of CARS24. He holds an MBA from IIM Calcutta and has worked with BCG. Previously, he started an online furniture company called FabFurnish.
Gajendra Jangid – Co-Founder and CMO of CARS24. He holds a BTech and MTech in Engineering from the Indian Institute of Technology, Bombay, and previously worked with Schlumberger.
Ruchit Agarwal – Co-Founder and Chief Financial Officer of CARS24. He graduated from Cornell University and was a Vice President at Bank of America Merrill Lynch before co-founding CARS24.
CARS24 has more than 150 branches across 35 cities in India and is backed by a team of over 700 employees as of 2020.
CARS24 – Startup Story
The founders discovered that the used cars industry was chaotic and lacked standard procedures and technological advancements. They decided to develop a technology to address these issues and simplify the process of buying and selling used cars online.
CARS24 – Mission and Vision
Mission: “Our mission is to revolutionize the way used cars are bought and sold across the world.”
Vision: To create an efficient and reliable way for car owners to sell used cars at a reasonable price.
CARS24 – Name, Tagline and Logo
The name CARS24 likely reflects their idea of emerging as a 24/7 car buying and selling platform.
CARS24 – Business Model and Revenue Model
CARS24 operates on a customer-to-business (C2B) model. It buys cars from individuals and sells them to dealers, charging a commission of 4-5% per transaction. The sale of pre-owned cars is the largest revenue driver, followed by financing services and commissions. The company also earns non-operating revenues from financial assets.
CARS24 – Growth and Revenue
CARS24 is the market leader in the online used car space with over 90% market share, having completed over 400,000 transactions to date.
Mega Refurbishment Labs: CARS24 plans to launch refurbishment facilities called ‘Mega Refurbishment Labs’ (MRLs) across 35 acres in top Indian metro cities.
Financials: In FY23, CARS24’s operating revenue was Rs 5,535 crore, with total expenses of Rs 6,058 crore and a loss of Rs 468 crore.
CARS24 – Products and Services
R&D Center: CARS24 opened its second research and development facility in Bengaluru, Karnataka, on October 6, 2023.
eChallan Service: Launched on September 6, 2023, this service allows private vehicle owners to monitor and clear outstanding challans via the CARS24 website and mobile app.
Pilot Program: Launched in March 2024 in Gurgaon, this program allows users to hire drivers for various types of journeys.
CARS24 – Challenges
CARS24 faces competition from newcomers and established players in the market. Ensuring an adequate supply of used cars is also a challenge.
Shutdown of Supply-Focused Vertical: On December 10, 2021, CARS24 shut down its supply-side business in 82 cities, focusing only on the top 100 cities.
Layoffs: In May 2022, CARS24 laid off around 600 employees to automate operations and cut costs.
High-Level Exits: In July 2022, several top-level executives left the company.
CARS24 – Competitors
CARS24 faces competition from companies such as CarDekho, Droom, Quikr Auto, Olx, CarTrade, and NDTV Auto.
CARS24 – Funding and Investors
CARS24 has raised around $1.52 billion to date. It entered the unicorn club on November 24, 2020, by raising $200 million in Series A financing led by DST Global. The company raised $400 million in a Series G round led by Alpha Wave Global on December 20, 2021.
Funding Rounds:
| Date | Stage | Amount | Investor |
|---|---|---|---|
| December 20, 2021 | Series G | $400 Million | Alpha Wave Global |
| November 30, 2021 | Debt Financing | $20 Million | Commercial Bank of Dubai |
| September 20, 2021 | Equity and debt | $450 Million | Softbank, Tencent, DST Global |
| September 10, 2021 | Series F | $258.6 Million | DST Asia, Alpha Wave Incubation, Moore Strategic Partners, Tencent Holdings |
| June 30, 2021 | Debt Round | $1.36 Million | Trifecta Capital |
| November 24, 2020 | Series E | $200 Million | DST Global |
| November 6, 2019 | Venture Round | $42.2 Million | Global Car Group |
| October 17, 2019 | Series D | $100 Million | KCK Global, Unbound |
| June 7, 2018 | Series C | $50 Million | KCK, Kingsway Capital, MPGI, Sequoia Capital India |
| January 2018 | Seed Round | – | – |
In August 2018, Mahendra Singh Dhoni invested an undisclosed amount in CARS24 as part of a Series D round,