Carsome, a used car e-commerce in Malaysia, will succeed in unicorn prestige after obtaining iCar Asia, making it the first in Malaysia.
As of July 13, 2021, Carsome becomes the first Malaysia-based generation unicorn after obtaining 19. 9% of iCar Asia Ltd (iCar) indexed in Australia from the Catcha Group.
Disclaimer: As Grab (then MyTeksi) was founded in Malaysia, there have been discussions over whether the name of the “first Malaysian unicorn” belongs to Grab, which is now based in Singapore. However, the point of this piece is not to debate who owns the name, but rather to revisit Carsome’s achievements.
Carsome will then offer to acquire the remaining 80. 1% of iCar from existing shareholders, a total transaction estimated at more than $200 million.
In return, Catcha Group will be a shareholder in Carsome, raising the startup’s valuation to more than a billion dollars.
During its 6 years of operation, Vulcan Post has documented the key elements of Carsome’s adventure since 2015. This new progression marks another step in the Malaysian startup’s belt, and we believe it’s suitable to look back on the course of their adventure.
Carsome was introduced in February 2015 with the goal of placing an exclusive booth to note and compare the more productive costs of other cars from other dealerships.
It has worked intensively with resellers so that its users can exclusively enjoy the benefits, and its efforts have paid off.
In the four months since its creation, it had already helped users save a cumulative total of RM500,000 on all transactions. At the time, co-founders Eric Cheng and Jiun Ee said Carsome users can save up to RM3,000 on retail value consistent with the car.
In its first fundraiser in August 2015, it raised USD 350,000 from 500 startups and IdeaRiverRun (IRR), and announced that it had already formed partnerships with one hundred distributors in Klang Valley, Johor and Penang.
But it didn’t take long for Carsome to switch to a segment that needed more help. In just over a year, Carsome took a turn and entered the used car market.
His main business now is to offer consumers a smooth delight when he came here to promote his used cars to dealers across the country, through a transparent bidding system.
Eric told Vulcan Post in 2016, “The advent of our proprietary pricing knowledge based on genuine transactions has been the key to the company’s growth. Used car costs vary widely and the market price of used cars is difficult to assess.
To succeed over this, the site set up an online scoring service for cars and provided 162-point auto inspections, which it said was the first and only to do so at the time.
Thanks to those services, users can simply put their favorite cars in their auction system. From there, more than two hundred dealers in Malaysia would get the most productive value for the car.
Since the beginning of 2016, Eric has stated that they have experienced an exponential expansion in their revenues and have a compound monthly expansion rate of 62%.
Dictionary duration: The compound expansion rate per month (MDRC) is the average month-to-month expansion over a longer period, from 6 to 18 months. A MGR of 20% is already considered exponential.
They also served an average of 200,000 users who bought and sold cars on the site and had surpassed 1,000 cars marketed annually. To date, Carsome Singapore had also started operations.
Carsome’s expansion was also supported through a US$2 million Series A circular directed through IRR, with the participation of IMG Investment Partners and 500 startups.
In June 2017, Carsome raised US$6 million in funding as a component of a Series A2 circular directed through Gobi Partners. Its monthly income has increased 12. 5-fold since its last circular in 2016.
At the same time, its annualized gross sales amounted to US$30 million, to date it had multi-regional presence in four markets: Malaysia, Singapore, Thailand and Indonesia, in total they worked with more than 500 distributors.
In March 2018, Carsome announced a Series B financing that raised US$19 million from a combination of global investors in Europe, China, the United States, Japan and Singapore.
The cycle was developed through Burda Principal Investments, with the participation of Gobi Partners, InnoVen Capital and Lumia Capital.
After the investment round, Eric had raised the option of an INITIAL PUBLIC OFFERING in the next 3-5 years, but concluded that they would be the first to develop the company.
Carsome also said it would introduce new vertical products such as financing and guarantees to gain advantages from auto dealers and customers.
Later, in a round of the B2 series, it grossed $8 million, and by the end of the year, it had crossed the mark of 10,000 cars sold annually.
Carsome created Carsome Capital in 2019, which provides recommendations and responses in terms of studies and request for financing, insurance and the like for the acquisition and sale of motor vehicles.
In the same year, he announced a partnership with Funding Societies Malaysia, the largest P2P investment platform in SEA. Together, they funded dealers, which helped local car dealers acquire used motor vehicles.
As a result of this collaboration, approximately 1,600 car dealers would have benefited from a total investment amount of US$200 million.
At the end of 2019, it raised US$50 million which included a mix of equity and debts from new and existing investors, which at the time exceeded 40,000 cars sold annually.
With CIMB Bank, Carsome co-developed a stock financing solution for used car dealerships, with the goal of reducing processing time and minimizing physical site documentation.
In May 2020, Carsome also introduced its 55. 5 million ringgit brokerage alliance program, which provided a short-term stimulus in the form of bonuses and lines of credit to help used car brokers rebuild their operations and finances after the MCO.
A little later, in August 2020, the startup officially unveiled its B2C along with the opening of its flagship store, the Carsome Experience Center in KL.
This is where users can simply check the used cars they are interested in on the site, after making a reservation online. If users were satisfied with their choice, then they can simply make a purchase with Carsome to manage financing, transfer of ownership, and even loan programs. as needed.
In November 2020, Carsome landed its 100,000th used distributor and, a month later, announced that it had raised a round of $30 million.
It was in January 2021 that Carsome officially announced the status quo of its first technical establishment in Malaysia, the Carsome Academy.
Its aim is to provide malaysian youth with guaranteed technical education and career opportunities. The establishment is an intermediate system Sistem Latihan Dual Nasional (SLDN) accredited through the Skills Development Department of the Ministry of Human Resources.
Students will take 30% of the theoretical courses at the academy before taking 70% commercial (1,840 hours) at any Carsome inspection centre in Malaysia. After graduation, the student is also guaranteed a homework assignment at Carsome.
The one-year course costs RM8,000 and is fully refundable in case of a successful placement and permanence of a graduate with Carsome. Student loans can also be obtained for academics who wish to continue their studies there.
7 months after 2021, Carsome has taken a leap forward with the acquisition of iCar, bringing it to unicorn status, the combined entity will now take over the US$55 billion virtual automotive area in SEA, as explained through Patrick Grove, CEO of Catcha Group. .
Based on Carsome’s track record, it is transparent that the startup’s expansion can be attributed to that of its team in researching and resolving non-unusual disorders in the used car segment.
They temporarily met an underserved segment and continually proposed answers at other levels, their perceived overall value.
Now, the resolution to win iCar Asia cements Carsome as a player to face in the industry that already has others like Belimobilgue, Cardekho, Carmudi and, of course, its rival Carro, to name a few.
Carro had officially achieved unicorn prestige just a month ago after a $360 million Serie C round. Today, as used motor vehicle e-commerce transactions are accentuated in the region, Carsome is still in an intense race with Carro for market dominance.
Meanwhile, Carousell is also making progress with its site’s automotive vertical, however, Carsome is disrupted by the festival and is aiming for $1 billion in profits by 2021 following the acquisition.
Near the acquisition, Eric concluded, “This is the first step toward consolidation to shape the largest virtual automotive organization in terms of revenue, user base, largest live directory, and end-to-end execution capability in the region. “
Image presented: Eric Cheng and Jiun Ee, co-founders of Carsome