Chinese online car trading platform Chehaoduo Group announced on Wednesday that it has raised another $200 million from SoftBank’s $100-billion debut Vision Fund and Sequoia Capital China, in an extended Series D round of financing following the previous $1.5-billion tranche in February 2019.
“The addition of funding has endorsed Chehaoduo’s risk-resistance capacity under the impact of the coronavirus pandemic,” said the company in a WeChat post, adding that it has realized profitability in the fourth quarter of 2019.
Beijing-based Chehaoduo, established in September 2015, was rebranded from “Guazi.com” in October 2017 when the company forayed beyond its major business of online used car trading into the online marketing and sales of new vehicles.
The firm now offers Guazi.com as a sub-brand to deliver used car trading solutions and “Maodou.com” as an online new car marketplace, as well as post-sales automobile services, financing, and insurance solutions in China.
“China has a huge automobile consumption market that is mainly composed of traditional players. The technology platform built by Chehaoduo has brought a positive effect to take auto purchasing online and lift the industry efficiency,” Eric Chen Xun, managing partner of SoftBank Vision Fund, was cited as saying in the post.
Steven Ji Yue, a partner of Sequoia Capital China, commented that the business model of Chehaoduo has been iterated and expanded from the initial second-hand automobile trading segment to offer new cars, as well as automobile after-sales maintenance solutions. These sectors remain largely untouched by the Internet enablers in China and therefore bear more challenges and opportunities.
Sequoia Capital China first invested in the firm’s $204.5-million Series A round in March 2016.
The fresh funds will be used to support the development of Chehaoduo’s after-sales services, as well as to strengthen the business collaboration among the new business and the existing offerings of Guazi.com and Maodou.com to reduce costs and increase revenues.
Chehaoduo announced in October 2018 that it secured $162 million in a Series C+ round in October 2018 at a valuation of $6.6 billion. Five months later, its valuation exceeded $9 billion after SoftBank Vision Fund poured the $1.5 billion into the firm in February 2019.
Previously, the company also garnered $818 million in a Series C round in March 2018 and nearly $600 million in a Series B round across two tranches in 2017, shows the company website.
Its earlier investors include Chinese social and gaming giant Tencent Holdings, Hong Kong-based investment firm DST Global, Chinese investment bank TH Capital, private equity firm Capital Today China, Alibaba co-founder Jack Ma Yun-backed Yunfeng Capital, China’s FountainVest Partners, Beijing-based investment firm IDG Capital, and venture capital company Matrix Partners China.
58.com, which operates China’s largest online classifieds marketplace, is also one of Chehaoduo’s key investors.