After receiving significant backing from a $28 million seed round in 2021, digital used car platform Carma has today announced it completed a fresh $75 million Series A funding round led by General Catalyst Partners and Tiger Global.
Boosted by the current demand for secondhand cars in Australia, Sydney-based Carma will use the investment to expand its presence along the eastern seaboard by setting up operations in Melbourne and Brisbane.
The end-to-end digital used car platform offers pre-owned vehicles with integrated financing delivered straight to the customer’s home, assuring the quality of the vehicles through an in-house inspection and reconditioning process.
“We are extremely proud of what we have built at Carma. We have a world-class team, an industry-leading used car reconditioning facility in Sydney, and a bespoke customer-centric platform, all supporting our end-to-end digital purchase process,” Carma co-founder and CEO Lachlan MacGregor said.
“This investment will allow us to accelerate our expansion interstate and continue to develop our platform, transforming the way Australians buy cars. To know that some of the most high-profile international investors with experience in this space have identified Carma as the player to back in Australia is incredibly gratifying.”
Founded in 2021, the Carma website launched last year after the co-founders spent months in stealth mode in preparation for the launch, and is currently only available for Sydney customers. Aside from accelerating its expansion, the Series A round will help Carma grow its team and car inventory.
Joining early Afterpay (ASX: SQ2) investor Tiger Global, who provided the entire initial seed capital to Carma, is fellow lead investor General Catalyst.
The US venture capital firm is a global proponent of the online used car business model and has been an early backer of Vroom (US), Cazoo (UK) and Spinny (India) and an investor in Kavak (South America). It has also previously invested in Australian businesses Canva, BigCommerce and Buildkite.
As part of the investment, General Catalyst managing director Adam Valkin will take a seat on the board of Carma.
“Online used car buying platforms are fundamentally improving the customer experience associated with buying and selling cars globally. We are confident that Carma will have a similar impact in Australia,” Valkin said.
Other investors include Entrée Capital, Avenir Growth, and Australian backers Five V Capital and Terrace Tower Group.
"Success comes down to the team and ability to execute. We have known Lachlan for many years, and we are excited about the business that he and Yos are building. There's an opportunity to build a clear category leader in this market,” Five V partner Adrian Mackenzie said.
Carma co-founder and chief commercial officer Yosuke Hall is delighted with the positive feedback Carma has received from its customers to date.
“It’s clear that Australians are excited by the prospect of an easier and faster way to buy high-quality used cars from a trusted source,” he said.
“Carma remains committed to becoming the recognised leader in Australian used cars – not only by providing a superior user experience but also as an employer of choice in the automotive industry.
“We know that success will come down to quality operations, seamless last-mile logistics, and unrivalled customer service. We’re thrilled to have the backing to continue executing on our vision.”
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