Source: Mint
According to three people familiar with the development, Cars24, a pre-owned vehicle e-commerce platform, has conducted redundancy among 200-250 employees in its restructuring plan this month.
“Cars24 has laid off around 250 employees this month across its product and technology verticals,” An unnamed source notes, with strategic reassessment and operational efficiency enhancement, this kind of decision is made.
The layoffs happened at a time when competition in the used car marketplace is intensifying. Spinny, one of Cars24’s major competitors, has raised more than $131 million in new funding from Accel’s Leadership fund, which concentrates on global scaling of certain select high-potential companies.
It was added that Cars24, which is backed by SoftBank, gave the affected employees a standard severance package.
In an official statement to Entrackr, Vikram Chopra, co-founder and CEO of Cars24, commented on the development: “This is a tough decision. Over the past few weeks, we’ve had to part ways with around 200 employees across various functions. We are deeply grateful for their contributions. The layoffs are not about performance, but about structure and the bets we placed. We’ve learned that speed without clarity is expensive, and some projects and roles were added prematurely. Moving forward, we need to be more strategic and deliberate with our investments and team-building.”
The company, having raised no fresh external financing in the last three and a half years, had nevertheless closed investment worth USD 450 million in December 2021 from major investors such as SoftBank, Tencent, DST Global, and Falcon Edge’s Alpha Wave, which gave it a valuation of USD 3.3 billion at that time.
The external stakeholder owners of Cars24 by startup data platform TheKredible are DST Global ahead of KCK Limited. Furthermore, Peak XV, Tencent, and Alpha Wave are other prominent investors.
The company has yet to announce its financials for FY25; however, Cars24 saw a revenue increase of 25% year-on-year in FY24-from ₹5,530 crore in FY23 to ₹6,917 crore. Along with the increase in revenue, the company also reported a net loss of ₹498 crore and an adjusted EBITDA loss of ₹318 crore during the same period.
The Cars24 management intends to realign its growth strategy during this restructuring phase along the lines of long-term sustainability and operational clarity.
Disclosure: Bareback Media, the publisher of this report, has recently secured funds from a group of investors. Some of the investors might have a direct or indirect stake in competing businesses or other companies covered in our stories. However, it does not affect the editorial decisions or journalistic integrity.
