Online automobile marketplace Droom Technology Pvt Ltd on Wednesday said it is raising $200 million (Rs 1,486 crore) in a pre-IPO funding round at a valuation of $1.2 billion, making it the latest startup to achieve the unicorn status.
The funds are being raised from new investors including 57 Stars and Seven Train Ventures as well as existing investors, said Droom in a statement.
The first leg of the round has been closed, Droom added.
Recently, Zomato became the first homegrown tech unicorn to list on the Indian bourses.
Soon fintech firms Paytm and Mobikwik as well as Droom's competitor CarTrade will follow suit as they have filed draft papers with market regulator for the initial public offering (IPO).
Sandeep Aggarwal, founder and CEO, Droom, said that the company expects automobile buying and selling to shift online rapidly in a post pandemic world.
The company expects online penetration for automobile buying and selling to rise to 7% in 2025, up from 0.7% at present.
Aggarwal, who also co-founded e-commerce portal ShopClues, set up Droom in 2014. The company says it has built out an entire ecosystem around used automobiles.
Droom’s current annual run-rate is $1.7 billion for gross merchandise value (GMV) and $54 million for net revenue.
It remains on track to touch a GMV of $2 billion and a net revenue of over $65 million in 2021, it said.
The company is also nearing profitability, it added.
Gene Pohren, managing director, 57 Stars, said globally it is seeing automobile buying and selling shifting online.
"We think Sandeep and his team have built an impressive digital ecosystem that can revolutionize the automobile buying and selling experience," added Pohren.
US-based 57 Stars is an asset manager focused on alternative investing strategies globally, with nearly $4 billion raised and managed.
Prior to this funding, Droom had raised $30 million (around Rs 220 crore) in its Series E funding round in October 2018.
The Series E investment was led by the family office of Japanese investor Joe Hirao, who is the founder of ZIGExN.
In the same year in May, the company raised another $30 million (around Rs 204 crore) in its Series D round, which was led by Toyota Tsusho Corporation and existing investor Digital Garage of Japan.
Toyota Tsusho is the trading arm of the Toyota Group.
Droom has also made acquisitions in the past years. Last year, it acquired Delhi-based augmented reality (AR) startup Visiolab Ideas to enhance its customer experience. In 2019, acquired non-banking financial company Xeraphin Finvest Pvt. Ltd to strengthen its consumer and dealer lending arm, Droom Credit.
Droom is the latest startup to enter the famed unicorn club of startups with a valuation of at least $1 billion.
India has churned out unicorns at a record pace this year despite the raging pandemic.
Just last week, BlackBuck achieved the unicorn status after Series E funding round led by Tribe Capital and other investors.
Fintech firm Cred, epharmacy PharmEasy, social networking platform ShareChat, marketplace for construction materials Infra.Market, industrial goods marketplace Moglix and messaging app Gupshup were among other startups that joined the elite club of unicorns this year.