New Delhi: Droom, an online automobile store which counts the likes of Japan’s Toyota Group and Lightbox Ventures among its investors, has raised $30 million in Series E funding from the family office of Japanese investor and entrepreneur Joe Hirao.
Another Japan-based family office also participated in the round, although Droom declined to share the name of the investor.
Hirao, an internet entrepreneur, is founder of Japan-based ZIGExN, and has in the past invested in real estate and automobile ventures. Sandeep Agarwal, co-founder and chief executive officer at Droom, said Hirao was in discussions with 20 other Indian ventures and might invest in some of them.
The investment comes after Droom raised $30 million from Toyota Tsusho Corporation, a unit of Japan’s automobile major Toyota Group, and existing investor Digital Garage in May this year. The company has raised $125 million cumulatively in funding till date.
Droom plans to utilize the capital to boost its credit services to buyers and dealers, and inspection and certification services. It also aims at investing heavily in developing its machine learning and artificial intelligence capabilities for its product portfolio.
“The current series E funding gives an immense fillip to us as we aim to simultaneously strengthen and diversify our services such as inspection, Droom credit, C2C and C2B marketplace formats, enable a smooth online transaction and provide more competitive terms and interest rates to customers through Droom credit,” said Agarwal.
The Gurugram-based startup is targeting loan disbursements worth Rs 150 crore in 2018-19 through Droom Credit, the company’s credit offering.
Droom’s platform serves as an online marketplace to buy and sell cars and two-wheelers. Over the past few years, it has branched into other services like fair value calculator, roadside assistance and auto loans.
The company is backed by Ellison Investments, an Asia-based investment manager; Hong Kong-based Integrated Asset Management Asia Ltd; and several independent investors from China and Hong Kong. It also counts Lightbox, Beenext, Beenos and Digital Garage as investors.
On Thursday, Droom also said that it would liquidate employees stock options (ESOPS) worth Rs 50 crore before Diwali this year.
“We will be allowing employees who have stayed for more than three years to liquidate their ESOP’s. We thought it would be a good way to reward our people,” said Agarwal.
Droom has also been eyeing international markets and will be operational in Thailand and Malaysia by the end of this year. The company has allocated $8 million for expanding its international footprint.
In India, Droom has forged a partnership with Swiggy and others for the supply of two-wheelers to its delivery fleet. Droom also has tie-ups with Ubermoto and over 20 other manufacturers, including Triumph and Hero Cycles.
According to Agarwal, the domestic online automobile transaction market is worth about $1 billion and is expected to grow to $20 billion over the next two years. Droom, which competes with the likes of Cars24 and Carwale, claims to hold 75% of the online automobile transaction market and is readying for an initial public offering (IPO) by 2020.
Droom was launched in 2014 by Sandeep Aggarwal, a co-founder of e-commerce firm ShopClues. The firm is registered in Singapore as Droom Pte Ltd.