According to an official statement, the seed round funds will be used to finance regional expansion across Southeast Asia, with multiple partnerships currently in the works.
Tagged as Malaysia’s first car shopping portal connecting car buyers to dealers, along with providing car-related news, it was founded by Eric Cheng and Jiun Ee Tioh in Q1 2015. Both co-founders had previously worked at online advertising firm Innity,
Commenting on the investment, Cheng said In a statement to e27: “We were bootstrapped from the beginning, so keeping the cost low has been really a challenge for us. Our savings were used for the initial cash injection and to build the first version of the website. That helped us carry through the first few months. With this funding, we will expand the team to help us grow market share.”
To date, Carsome claims to serve 150,000 potential car buyers per month and to have developed business partnerships with 100 dealers in Malaysia. The venture allows Malaysian car buyers in Malaysia to compare prices from up to five models and find various dealers in the country. Carsome also claims to be growing at 25 percent month-on-month.
Its platform provides a data analytics component that enables users to research and evaluate both the make and model, along with a quotation. From From here, users can then request offers in the form of separate quotations from dealers. This helps buyers find the best prices upfront, with pre-negotiated quotations.
Cheng claims that Carsome is seeing significant sales volume, with cars valued at an average of US$16,600 each and a total of US$142,200 worth of cars being solid on the platform to date.
Carsome’s business model operates on the basis of transactions, with dealers being charged per sale rather than for listing. This is beneficial to dealers, due to saving on marketing costs. The conversion rate of leads to actual sales is around 20 percent, according to Cheng.
Additionally, Carsome advertises a selling platform in which a trained inspector can provide a valuation of the car, with Carsome facilitating the sale if the price is agreeable to purchasers. Altogether, this brings greater transparency to car trading, benefiting consumers with the information and dealers with a platform that is both transparent and allows for targeted selling.
500 Startups managing partner Khailee Ng said, “The Carsome team is the first to introduce a globally successful business model in the Southeast Asia market. They are introducing a working business model that is successful and proven by Beepi in the US, Carwow in the UK, and Truecar, a public-traded company in the US with a market cap of US$563 million.”