Companies

Droom aims to list on the NASDAQ in H2 of 2022

Sangeetha Chengappa Bengaluru | Updated on March 24, 2021

In talks to raise over $100 million in a pre-IPO round

Freshly minted Unicorn start-up Droom plans to list on the NASDAQ in 2022 and is in the market to raise a pre-IPO round of $100 million, a top executive told BusinessLine.

Founded in November 2014 by Sandeep Aggarwal, who also founded ShopClues in 2011, Droom is an AI driven online marketplace for buying and selling used and new automobiles. In calendar year, 2019 Droom clocked $1.2 billion in GMV and $32 million in net revenue, however, in CY 2020, its GMV nosedived sharply to $600 million and net revenue to $17 million due to Covid-related business disruption.

“In April/May/June 2020, our business came down to zero with the 4-month national lockdown. For the next 4-5 months the supply side of automobiles was greatly disturbed. Recovery started in July and from December our business grew higher than pre-Covid levels. We are currently at an annual run rate of $1.5 billion in GMV and will achieve north of $2billion in GMV and north of $65m million in net revenue in CY 2021,” said Sandeep Aggarwal, founder and CEO, Droom.

“We sold around 3000-4000 vehicles/month pre-Covid, and now we sell 7,500-10,000 vehicles/month. The pandemic has accelerated digital adoption of automobiles and the shift is more pronounced among used cars and two-wheelers as opposed to new ones” he said.

The Average Order Value on Droom is ₹5.5 lakhs for cars, ₹40,000 for scooters, ₹60,000 for motorcycles, ₹26 lakh for luxury cars and ₹4-5 lakh for superbikes. Droom charges the seller 3 per cent of the transaction value of the vehicles sold on its platform as commission.

The start-up has raised $125 million in six rounds of funding since its inception. Additionally, it raised another undisclosed round of funding in the midst of the pandemic in October 2020 at a $1billion valuation, sources told BusinessLine. Droom’s key investors include Beenos, Lightbox, Beenext, Digital Garage, Integrated Asset Management, Toyota Tsusho Corporation and office of Joe Hirao (founder of ZigExn)

“We are planning to list Droom on the NASDAQ in the second half of 2022. On an opportunistic basis, we will raise over $100 million in a pre-IPO fund raise and are already in talks with investors for the same,” said Aggarwal, who refused to divulge financial details of the company’s October fundraise or its post-money valuation.

Since its inception, Droom has seen 1.2 billion visits on its website/app, has sold 3,25,000 automobiles, provided 1.4 million services including pricing, inspection, history, loan, insurance, roadside assistance and extended warranty. “Close to 1 million vehicles, worth $15 billion are listed on Droom by dealers and customers and we are available in 1090 cities pan India,” claims Aggarwal. Droom competes with CarDekho, Cars24, Spinny and CarTrade.

Published on March 24, 2021

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