- In the midst of closing another funding round
- Hopes to offer financial services in the near future
AFTER recording a strong 2016, automotive portal Carsome is all optimistic that its momentum can continue, as the company is looking to introduce new services and entering new markets.
"2017 will be an exciting year for us. We are looking at launching new products and to enter new markets. We may also announce a major deal," said cofounder and chief executive officer Eric Cheng in an interview with Digital News Asia recently.
Currently, Cheng said that the company is in talks with potential investors and will share the details once the new funding round is finalised.
"We are in the midst of closing one (funding round) and will be announcing very soon once we finalised," said Cheng, without revealing further details about the negotiation.
The year 2016 was a year of many positives for Carsome. In March, it closed a US$2 million Series A funding round. The round was led by IdeaRiverRun (IRR), with participation from IMJ Investment Partners and 500 Startups. [Disclosure: In November 2014, IRR also invested approximately US$300,000 in DNA]
It was also the year where it expanded its car selling platform to new markets. Its platform is now operating in four countries, namely Malaysia, Indonesia, Thailand and Singapore.
"We have also built a sophisticated, complex mobile and web platform to digitalise the process of used car selling with a real time car auction system.
"More than 2,000 cars have been sold in 2016, and that is 10x growth from 2015," said Cheng (pic left).
"More importantly, we are already profitable in each transaction which makes us a sustainable business in the long term."
The year also saw the company on-boarded 1,000 used car dealers into its network. "This is not an easy achievement, considering the old-fashioned and change-adverse industry," Cheng said.
There were also a few challenges for Carsome in 2016 -- including creating the inspection methodology.
"Part of our service is also to offer quality inspection service to consumers, which would then be presented to dealers as a report for bidding during the online car auction so they could offer their best price with confident.
"Creating the inspection methodology took us a few months as well as implementing it at scale and creating repeatability in inspection quality was a huge challenge," said Cheng.
To overcome the challenge, the company invested its resources into hiring experienced inspectors who would embrace Carsome's technological solutions to the offline used car market.
"That helped us speed up the used car distribution while maintaining high quality inspection," he revealed.
Plans for 2017
Carsome, unlike most other automotive portals, do not put much emphasis on having a lot of listings. In fact, the company has zero listings on its sites and its main focus would be on how many cars were sold and bought through its platform.
Instead of listings, Carsome provides 'car-selling services'. It allows sellers to access information on car valuations with full transparency and sell their cars to the startup within a day. It also assures car dealers a constant first-class supply of thoroughly inspected cars
At the same time, it also give car buyers the best offers in town by providing up to five upfront offers, while providing dealers with genuine leads. This is done via its proprietary real-time pricing algorithm.
In the near future, the company plans to introduce new products to the customers and to expand to new markets.
"We have plans to go into offering financial products to our customers. For now, this is all we can reveal and we will be able to reveal more when the time comes.
"Also, the used car market in South East Asia is enormous and is certainly ready for disruption. Car auction represent less than 5% of used car sales in the region versus more than 75% in mature markets like Japan and the US. We intend to bring our services to more location within the countries we operate in.
"We are also looking to partner with car brands to offer our services to their customers with trade-in request as a value-added service," explained Cheng.
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