Technology-enabled car care service startup GoMechanic, a servicing and spare parts company for used cars, said on June 23 that it had raised $42 million in Series C funding led by Tiger Global Management with existing investors Sequoia Capital India, Orios Venture Partners, and Chiratae Ventures investing as well.
It is the series C round of institutional funding for GoMechanic. The proceeds of this funding round will go into accelerate GoMechanic’s growth and expansion in Tier2 and Tier3 cities in India, ramping up the technology team and launching operations in the international markets. The fundraising also includes a $5 million buyback of ESOPs of the early employees of GoMechanic.
GoMechanic will expand its business from the current 35 cities to 100 plus cities in India and triple the technology team size from the current 60. It currently services over two million cars a year and is targeting 10 million customers by 2021. Founded by Kushal Karwa, Amit Bhasin, Rishabh Karwa, and Nitin Rana in 2016, GoMechanic promises doorstep pickup and drop, tracking your car service in real-time trying to digitize a fundamentally offline industry.
“We will use the funding towards expanding our operations and spare parts supply chain in India while also exploring global opportunities. We intend to make India the innovation hub in auto aftermarket technology and services similar to how it has become a manufacturing hub for a lot of global auto players,” the founders said in a joint statement.
“Since Sequoia Capital India first partnered with GoMechanic in 2018, the company has had a robust growth trajectory. This additional growth capital will enable the company to grow faster and tap into newer opportunities,” said Abhishek Mohan, Principal at Sequoia India.
Used car segment witnessing a significant change
Digitizing the car buying and maintenance experience has been a big theme for investors in the last few years. beSUCCESS reported on June 17, Tiger Global is in talks to lead a $100 million round in used car retailer Spinny, valuing it at $800 million.
“The servicing and repairing of cars have been using the same model since World War II, alongside an exorbitantly priced system of spare parts and accessories. We believe that car ownership should be a joy, and in GoMechanic, we found a team that shared that vision. We invested with them at seed and every round after and are delighted to see the heights they have taken the space to,” said Rehan Yar Khan, managing partner at Orios Venture Partners.