Online used car retailer Spinny has raised $43.7 million ( ₹315 crore) in its Series B round led by Infosys chairman Nandan Nilekani’s venture capital fund, Fundamentum Partnership, which invests in mid-stage technology companies in India.
The round also saw the participation of new investors, including US’s venture capital firm General Catalyst Partners and Korean financial services conglomerate KB Financial Group, besides existing investors Accel, SAIF Partners and Alteria Capital, which came in as co-investors, the company said on Monday.
“With the increase in disposable income levels and evolving consumer demand, we want to be the market leader in the organized used car market segment, and provide our customers a completely trustworthy and hassle-free buying experience,” said Niraj Singh, co-founder and chief executive officer, Spinny.
Founded in 2015 by Singh, Mohit Gupta and Ramanshu Mahuar, Spinny is an online-to-offline pre-owned car sale platform, which allows customers to discover cars online on Spinny’s website and make the final purchase offline at a Spinny Car Hub.
The company is present in Delhi, Noida, Gurugram and Bengaluru, and has sold close to 10,000 cars. It plans to use the funds to invest in technology, strengthen business teams, enhance customer experience and expand to newer cities.
Last April, Spinny had raised a seed round from Blume Ventures and Simile Ventures. Most recently, it had closed its Series A round of $13.2 million co-led by SAIF Partners and Accel. It had also raised ₹20 crore in venture debt from Alteria Capital.
Founded in 2017 by Nilekani and former Helion Ventures partner Sanjeev Aggarwal, Fundamentum Partnership started with an initial corpus of $100 million, extendable to $200 million.
Fundamentum Partnership invests in consumer technology businesses, with an average investment size of $10-25 million in firms that have attained the product market fit, have an initial momentum and are looking to scale up.
“I like full-stack businesses that are building competitive differentiation as they scale. The Fundamentum team was impressed with the Spinny team’s ability to use technology to solve for operational friction in the business, and thereby build a sustainable advantage. This fits into Fundamentum’s thesis of backing long-term-oriented entrepreneurs to solve complex business problems using technology, and who aspire to build a company at scale and to last,” said Nilekani, also the chairman of Fundamentum.
Once the acquisition is complete, Ashish Kumar, a partner at Fundamentum, will join the Spinny board.
The development comes amid online car retailing startups, particularly in the used car segment, seeing higher investor interest, as local car sales have been falling due to an economic slump, coupled with supply chain challenges due to the coronavirus outbreak.
Data released by top carmakers in India, including Maruti Suzuki India Ltd, Hyundai Motor India Ltd, Mahindra and Mahindra Ltd (M&M) and Tata Motors Ltd, showed total sales of 197,080 vehicles last month, down 12% from 224,241 units sold a year-earlier, according to a Mint report on 1 March.
