Singapore-based online car marketplace, Carro, has announced today it raised a US$5.3 million Series A led by Venturra Capital — a venture firm backed by the Indonesian conglomerate Lippo Group.
Other participating investors were Singtel Innov8, Coffee Ventures and Golden Gate Ventures from Singapore, Indonesia’s Alpha JWC and Skystar Ventures along with GMO Ventures from Japan.
More firms engaged in the round but were not publically disclosed.
Carro CEO Aaron Tan told e27 the company hopes to expand beyond Singapore and have a presence in Malaysia, Indonesia and Thailand by the end of 2016.
“We have not officially launched in any of the countries yet, [we are] mostly in private beta but are already actively recruiting, signing partnerships, etcetera, in these countries,” he said.
Launched in November 2015 by five car enthusiasts and former IDA National Infocomm Scholars, Carro is an algorithm-based marketplace where people can buy and sell used cars.
The company makes revenue through collecting commissions from partnerships with financial institutions like banks and insurance companies. It also charges a S$250 (US$183) fee if a car gets sold via the Carro platform.
Carro believes it stands apart because of its tech-based business strategy. The team emphasises data analytics, visualisation, machine learning and product management. Also, the management team contributes directly to the development of product; which has lead to Carro releasing an additional three services over the past six months.
Since February, the company built a fair-price evaluation tool called graph.sg and an accessories retail website called Carro Accessories. And today, the company is launching Carro Workshop — a mobile app which recommends the best autobody shop for the user based on the car’s specific need and factors like location, pricing and reputation.
Tan said the biggest challenge in starting Carro was educating people that it is not only possible, but probably better, to break away from the system of approaching a dealership when trying to sell a car.
“Most people are stuck in the mindset of having to sell to a dealer because they deem it as the only way, or a hassle-free way to do so; however much they hate the experience of visiting a dealership. This change in mindset has been fairly tough to change, we are chipping that away slowly each day,” Tan said.
At the end of the day, this challenge was also what Tan pointed towards when asked, “what a good year would look like”.
“More than just what we are going to achieve numbers-wise, it is all about making sure that consumers are aware of this alternative and more importantly, in a good year, saving millions for our buyers and sellers,” he said.
In a market in which education is the major hurdle, it appears Carro’s strategy is to focus on customer service to ‘slowly chip away’.
The company pitches its transparent listings, test drive options, help with the financials and a 114 data-point inspection that potential buyers/sellers can utilise. Carro also takes an active role in facilitating all the transactions.
Carro claims to be growing 30 per cent month-on-month since its launch and says it is on target to achieve a a gross merchandise run-rate of S$100 million (US$73.5 million) by the end of the year.
In November 2015, the startup raised a S$1 million (US$735,000) seed round and, at the time, expressed a desire to promote brand awareness.
Photo courtesy of Carro