China's Chezhibao, Tiantian Paiche secure funding

Chezhibao, which is also known as Mychebao, raised RMB800 million ($125 million) in a Series D round led by Green Harbor Investment, a growth capital-focused private equity firm established by a former Yunfeng Capital executive. Existing investors PAG Asia Capital, Addor Capital, and Gobi Partners re-upped.

The company differs from many of its peers in the used car auction space by focusing on the C2B market, a segment in which it claims to be the largest player nationally. Chezhibao has a presence in 50 cities, claiming to serve tens of thousands of contracted used car retailers. Its auto experts appraise vehicles before listing them online, allowing buyers to make direct offers to owners. Transactions are completed online with Chezhibao providing after-sales services.

According to Le Huang, the company’s founder and CEO, sales volume and revenue both increased 400% year-on-year in 2017. He plans to use the latest funding to build out Chezhibao’s infrastructure and open more offline service centers. The company also plans to grow its auto financing business, which has already extended more than RMB10 billion in credit through its bank partners and made loans to 100,000 used car dealers.

Zidi Liu, Green Harbor’s founding partner, said in a statement that Chezhibao has created a closed-loop commercial ecosystem for the used car industry, with its data assets alone having huge potential in areas such as financial services, retail, and logistics. “Its unique business model and high operational efficiency mean it can take full advantage of development opportunities brought on by the rapid growth of the used car market,” she added.

Meanwhile, TTP issued a convertible bond worth $100 million in cash to Autohome, a Chinese online marketplace for new cars. The US-listed player has the right to purchase an additional bond for $65 million within the next three years. TTP focuses on the B2C market, connecting used car buyers with dealers through a technology platform intended to increase choice, reduce costs, and minimize intermediation.

Autohome is expanding into the used car space and was attracted by TTP’s network of offline service centers that covers 40 cities. "Autohome is building an ecosystem through organic growth and investments, and TTP plays an important role in such an ecosystem. The two companies have strong strategic alignment, and their businesses complement each other,” Autohome CFO Jun Zou said in a statement.

Chezhibao received $10 million in Series A funding from Gobi and Nanjing Venture Capital in 2014 and a RMB300 million Series B led by JD Capital and Addor the following year. In 2017, the company closed a $100 million initial Series C led by PAG and then an extension of RMB500 million. TTP closed its Series C round in October of last year, having received $180 million from the likes of Pagoda Investment and Hanfor Capital Management.

The latest investments come a week after private equity-backed Uxin Group filed for a US IPO, which should make it the first sizeable used car trading platform to go public. There have also been substantial funding rounds for the likes of Souche and Guazi, with both Alibaba Group and Tencent Holdings making their affiliations known.

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• Topics
• Greater China
• Expansion
• Technology
• China
• TMT
• automobiles
• PAG
• Gobi Partners
• Pagoda Investment
• Growth capital
• Green Harbor Investment