Car workshop and auto spare parts platform, GoMechanic, on Wednesday said it has raised $42 million as a part of its Series C funding led by Tiger Global Management.
Existing investors Sequoia Capital India, Orios Venture Partners and Chiratae Ventures also participated in the fundraise.
Mint had earlier reported that Tiger Global was in talks to invest up to $100 million in GoMechanic, at a likely valuation of around $500 million.
With its fourth institutional fundraise, GoMechanic plans to use the proceeds to expand further into tier-2 and -3 geographies. It also plans to ramp up its hiring for the technology team and launch operations in international markets.
The fundraise includes a $5 million buyback of employee stock ownership plan (ESOP) of the early employees of GoMechanic.
“We are thrilled to welcome Tiger Global as our partner at the cusp of our next phase of growth. The current fundraise is further validation of the hard work put in by the GoMechanic team. We will continue to invest in expanding our operations and spare parts supply chain in India while also exploring global opportunities,” said the founders of GoMechanic in a statement.
GoMechanic will take its presence from the current 35 cities to more than 100 cities in India and triple the technology team.
“Since Sequoia Capital India first partnered with GoMechanic in 2018, the company has had a strong growth trajectory. It has expanded geographically to several cities and made a deep foray into spares which is a $7 billion opportunity with large profit pools. The team has also deployed tech across the value chain exceptionally well. This additional growth capital will enable the company to grow faster and tap into newer opportunities,” said Abhishek Mohan, principal, Sequoia India.
Prior to this round, GoMechanic had raised a total of $21 million from Sequoia Capital India, Orios Venture Partners and Chiratae Ventures. Earlier in 2020, Pawan Munjal, Chairman, MD & CEO, Hero Motocorp invested an undisclosed amount in the company.
“We continue to be excited about the vision GoMechanic team has set for themselves. India is the fifth-largest auto market globally. As it has happened in other industries, digitization and changing consumer trends will have an impact on the way products and services are consumed in this sector. Delivering personalized experiences to the end consumer while standardizing the processes on the supply side through technology will enable GoMechanic to become the breakout brand,” said Ranjith Menon, executive director of Chiratae Ventures.
Currently, GoMechanic has over 600 car repair workshops across 35 cities in India, including Delhi-NCR, Hyderabad, Mumbai, Pune, Bengaluru, Chennai, and Kolkata. It services more than 2 million cars annually and is targeting 10 million customers by 2021.
