Carsome Group Inc announced today the successful conclusion of its most recent funding round, bringing its liquidity position to around USD200 million (RM924.9 million). The fundraising round witnessed widespread participation from existing investors, including 65 Equity Partners, Seatown Private Capital Master Fund, Qatar Investment Authority, Gobi Partners, and Asia Partners.
Additionally, a new investor, EvolutionX Debt Capital, a growth-stage debt financing platform specialising in technology companies in Asia, provided a long-term debt facility.
Carsome in a press release said they have experienced impressive growth in 2022, with its revenue surging by 250% to reach USD1.5 billion (RM6.93 billion).
Notably, the newly established regional retail line, Carsome Certified, accounted for 35% of the total revenue. In Q1 2023, Carsome achieved an important milestone by attaining operational profitability, driven by a substantial increase in trade margin, which doubled compared to the same period last year.
Transaction margins accounted for more than 80% of the trade margin, indicating significant potential for ancillary revenue. Carsome has been actively focusing on expanding its ecosystem offerings, including Financing, Insurance, and Aftersales, to further capitalise on this potential.
One of Carsome’s aftersales offerings, the Carsome Service Centers (CSC), has experienced remarkable growth since its launch at the end of last year, with monthly growth exceeding 100%. The CSC network is expected to achieve nationwide coverage in Malaysia by the end of Q3 2023 according to the company.
Our comfortable liquidity position and strong backing from both existing and new investors place us on solid footing to deliver the world’s first integrated car ownership ecosystem, going beyond just buying and selling cars to include ancillary services across the whole ownership lifecycle.
Carsome’s Co-Founder and Group CEO, Eric Cheng
We are delighted to have our new investor EvolutionX joining us at this stage of our growth.
Profitability is just one of the milestones in our long-term capital planning, and we will continue to invite the right partners who can add strategic value at different stages of our growth.
Carsome’s Group President and CFO, Juliet Zhu
Despite being a local company, they did not receive interest from government-linked companies (GLCs) or sovereign wealth funds. The company allegedly reached out to deputy finance minister Steven Sim previously, expressing their hope that the Ministry of Finance (MoF) could strongly recommend the country’s sovereign wealth funds, government-linked investment companies (GLICs), and GLCs to participate in an upcoming external fundraising round worth USD10 million (RM46.2 million).
The company clarified that their communication with the ministry was not an appeal for a bailout, dismissing such market speculation. In their letter to Sim, they highlighted the overshadowed involvement of GLICs compared to foreign investors in their investments in the company.
Malaysian government-linked investors accounted for less than 10% of Carsome’s “cap table” (capitalisation table, referring to the ownership breakdown).
