ONLINE car seller Carmudi Philippines Inc. (CPI) announced on Tuesday it has raised a fresh capitalization of $10 million last year.
The amount brings to $45 million the total fund the company said it was able to raise in the last four years. The third round involved funds from HV Holtzbrinck Ventures, Tengelmann Ventures, Asia Pacific Internet Group and some private investors.
CPI Managing Director Juan Gregorio Syquia told the BusinessMirror the company will use the funds to grow its business in markets where it operates.
“This will be used primarily on the focused countries now, which are the Philippines, Indonesia and Sri Lanka,” Syquia said. “But the bulk of it will go to Carmudi Philippines and Indonesia.”
The new investment comes at a crucial time as the company moved headquarters to Asia and has new management taking over.
“As the market in Southeast Asia is evolving extraordinary well, we have moved our headquarters to Jakarta,” CPI CEO for Asia Pranjal Kanwar said. “We want to ensure an unmatched car-buying experience for anyone looking for a new or used car, which is a challenge in today’s highly fragmented automotive market.”
According to him, the capitalization will be used to grow the existing business listings and to build new technology to support newer business verticals, such as auto finance. The latter, Kanwar said, already contributes a large part to the firm’s current revenue.
Across the region, especially in Southeast Asia, the auto-classified industry is experiencing significant growth at present, he added.
Martin Weber, general partner in HV Holtzbrinck Ventures, said they chose to fund CPI as it is already the top car-classifieds site in the Philippines and Indonesia.
“The new round is an affirmation of our confidence in the auto-classified industry and the new management team,” Weber said.
Both markets now have a combined vehicle listings of over 100,000 and 5 million plus monthly users, he added.
Given its huge population, Indonesia’s share is bigger, which is between three to four times than the Philippines, according to Syquia.
“But in terms of listing count and other KPIs [key performance indicators] in [online] traffic, the Philippines is actually doing by ratio very good, as well,” he said. “By traffic, supposedly we should be one-third to one-fourth only, but we’re doing a bit more than one-fourth of traffic in Indonesia month-on-month [basis].”
Without citing the breakdown of the new investment between the Asean markets, Syquia said he expects this additional funding will further bolster their current operations and would develop more programs that would make business plans suited for the local setting.
He said the company is heavily expanding its marketing initiatives while improving the platform to address the Filipino market’s need.
For instance, he cited CPI is developing further the portal to become more Internet-friendly.
“We’re also strengthening our presence in Cebu and Davao. We have offices there. So we want to reach the whole of the Visayas region by our Cebu office and the whole of Mindanao region via Davao,” Syquia said. “We have to do a lot of marketing initiatives in these sub-[regions].”
While CPI currently have partners from all automobile brands in the three key cities where it operates, used car dealerships is not fully developed in their covered areas outside of Luzon.
“For Metro Manila, we pretty much have 80 percent to 90 percent of all used car dealers that are organized. The difference in Cebu and Davao is that, these car dealers are not organized and they’re very small players. So the goal is actually to reach out to them since Carmudi is available for them, as well,” he said.
Part of the plan is to also increase manpower, which the firm aims to grow from 84 employees to “around a hundred by about midyear.”
“With the new capitalization, the goal is to sustain the double-digit percentage growth in terms of revenue, content, listing count and traffic,” Syquia said.
Carmudi was established in 2013 and is currently available in Indonesia, the Philippines and Sri Lanka, offering buyers, sellers and car dealers the ideal platform to find cars, motorcycles and commercial vehicles online.