Droom, the Gurugram-based online automobile marketplace has secured INR 220 crores (about $30 million) in series E round of funding led by the family office of Japan-based investor Joe Hirao. Another Japanese family fund also participated in the round. The names of some investors have not been disclosed by the company.
Droom will utilize the capital to strengthen its various services on the platform and improve Droom Credit, the credit arm of Droom that offers loans for cars and bikes. Doom also plans to buy ESOPs from more than 60 employees worth around INR 50 crores. The startup will complete the buyback process till Diwali this year. While Droom is looking to expand its presence to 100 cities in India, it is ready to launch operations overseas, starting with Thailand and Malaysia, by the end of this year.
Founded by Sandeep Aggarwal and Rishab Malik, the startup provides a marketplace to enable users to buy and sell old and new vehicles. Droom offers four different marketplace formats which include Business to Business, Business to Consumer, Consumer to Consumer and Consumer to Business. Through the platform, it offers a wide range of products across categories like Bicycle, Car, Motorcycle, Electric Vehicles, Scooter, and Loan & Insurance.
“We have been on a fantastic growth trajectory, which is reflected in the confidence of our investors. We have an annualised gross merchandise value (GMV) run rate of $750 million and are doing $20 million annual revenue run rate,” said Droom founder and CEO Sandeep Aggarwal.
Droom is expected to become profitable by the third quarter of 2019. The company is trying its best to keep expenses under check. Also, the startup is looking to double is GMV to$1.4 billion by the end of this year and further expand to $3.5 billion by next year. The profitability plans align with the plans to go for Initial Public Offering in 2020.
According to a report by IBEF, the automobile industry in India is the fourth largest in the world with sales growing at CAGR of 9.5%. Last year, 4.02 million units of vehicles (excluding two-wheelers) were sold in India. The industry has attracted Foreign Direct Investment (FDI) worth US$ 19.29 billion during the period April 2000 to June 2018, according to data released by Department of Industrial Policy and Promotion (DIPP).
Droom last raised $30 million in series D funding round led by Toyota Tsusho, along with participation from Digital Garage and Ellison Investments in March 2018. Other players in the automobile marketplace domain include CarDekho, Truebil, CarTrade, Cars24, and CarWale, among others.