Online automobile e-commerce platform Droom has raised USD 20 million (nearly Rs 130 crore) in latest funding round led by Integrated Asset Management (IAM) and existing investor, Digital Garage. The fifth round of funding also saw participation from other existing institutional investors -- Lightbox, Beenos and Beenext.
Online automobile e-commerce platform Droom has raised USD 20 million (nearly Rs 130 crore) in latest funding round led by Integrated Asset Management (IAM) and existing investor, Digital Garage. The fifth round of funding also saw participation from other existing institutional investors — Lightbox, Beenos and Beenext. “The funds will be used to strengthen the technology platform, tech-focussed acquisitions and strengthen Droom’s brand portfolio,” Droom founder and CEO Sandeep Aggarwal told reporters here.
Droom has so far raised USD 65 million, including from the latest instalment. Aggarwal declined, however, to comment on the valuation of the company. “We still have funds in bank from our last round. However, the excess capital will help drive growth,” he said. Besides, the company also plans to pump in about Rs 225 crore in branding and marketing activities this year.
Last year, Droom raised nearly Rs 200 crore from Beenext and Digital Garage. Prior to that, it had raised seed funding of USD 1.5 million and USD 4 million in May and October 2014, respectively, followed by Series A round of Rs 100 crore in June 2015. Aggarwal said the company expects to clock Rs 175 crore in revenue by March 2018 and start making profits by the middle of the next year.
The company is also looking at listing on Nasdaq by the middle of 2019 and by then, Droom’s GMV will touch about USD 2.5 billion, he added. GMV is a term used in online retailing to indicate the gross merchandise value of products sold through the marketplace over a certain period of time. It is often used as a reference by start-ups to showcase growth potential of the company and therefore, raise funds from investors.
However, investors are now more attentive towards factors like path to profitability and scalable business models rather than just GMV. Acknowledging that the company was “running late” in terms of acquisitions and international expansion, Aggarwal said Droom will look at expanding to countries like Indonesia, Philippines and Malaysia after Diwali.
“India is larger than the South East Asian countries put together. We will look at expanding into other countries, starting with Indonesia after Diwali. However, currently the focus is on expanding the India market,” he added. On acquisitions, Aggarwal said the company has been scouting for startups since last year. “Since last year, we have looked at over 150 companies and have has discussions with about 25 of them. However, nothing has been finalised,” he said.
While Aggarwal did not share the size of the acquisition the company is eyeing, he said it will be an all-cash deal and will be solely to acquire technology solutions.